Liaison Office in India
A liaison office setup is most appropriate for person resident outside India who wants to extend their head office business in India also or need a marketing office in India. Most foreign companies use this mode to promote their products or services in Indian market.
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Eligibility for opening a Liaison office
A person resident outside India can establish a liaison office in India provided it meets the criteria of profit-making track record during the immediately preceding three financial years in the home country and net worth of not less than USD 50,000 or its equivalent.
Provided that a person resident outside India who is not financially sound and are subsidiaries of other companies may file a Letter of Comfort from their holding company but the holding company satisfies the prescribed criteria of net worth and profit.
A person resident outside India permitted by the Reserve Bank under these Regulations to establish a liaison in India may undertake or carry on any activity specified below:
- Representing the parent company / group companies in India.
- Promoting export / import from / to India.
- Promoting technical/ financial collaborations between parent / group companies and companies in India.
- Acting as a communication channel between the parent company and Indian companies.
List of Documents Required
- Copy of the Certificate of Incorporation; Memorandum of Association (MOA) and Articles of Association (AOA) attested by the Notary Public in the country of registration. [If the Certificate is in a language other than in English, the same must be translated into English and notarized as above and cross verified/attested by the Indian Embassy/ Consulate in the home country]
- Certified copy of the financials for last three years. [If the applicants’ home country laws do mandate auditing of accounts, an Account Statement certified by a CPA or any Registered Accounts Practitioner, disclosing the net worth may be submitted]
- Certified copy of Certificate of net worth & Profits for last 3 (three) years
- Bankers' Report from the applicant’s bank in the host country showing the number of years since when the applicant has had banking relations with that bank.
- Board Resolution of parent company for approval of opening of liaison office in India
- Notarised copy of Board Resolution in favour of Mr/Ms/Miss, local Representative to sign & execute all the documents required for this purpose
- Notarised Identity & Address proofs of the person signing documents on behalf of parent company;
- Notarised Identity & Address proofs of the Authorised Representative;
- Notarised Identity & Address proofs of Directors of the parent company;
- A person resident outside India may establish in India a liaison office for a period of three years. The non-resident entity may apply to the Authorised Dealer Category-I bank for extension of the validity period of approval, and upon receipt of such an application, the Authorised Dealer Category-I bank may extend the validity period of approval for a further period of three years from the date of expiry of the original approval.
- Entities engaged in construction and development sectors and which are Non-Banking Finance Companies are permitted to open a Liaison Office for two years only. No further extension would be considered for liaison offices of these entities. Upon expiry of the validity, the offices shall have to either close or be converted into a Joint Venture / Wholly Owned Subsidiary in conformity with the FDI policy.
A person resident outside India desiring to establish a branch office shall submit an application in Form FNC to an Authorised Dealer Category-I bank.
Every foreign company shall, within 30 days of establishment of its branch office in India submit the Form-FC-1 to ROC.
- RBI approval letter
- Certificate of incorporation
- Company PAN card
- Company TAN number
India Entry Services
|Particulars||Company/LLP||Branch Office||Project Office||Liaison Office|
|Eligibility||No Criteria||Profit track record of 5 FY and net worth of USD 100,000 or more||No Criteria||Profit track record of 3 FY and net worth of USD 50,000 or more|
|Approval||ROC||RBI and ROC||RBI and ROC||RBI and ROC|
|Purpose/Activities||Commercial, trading, or industrial activities in India||Commercial, trading, or industrial activities in India except retail trading & manufacturing||To Execute a particular project in India||Representing, Promotion and communication|
|Sources of Funds||Capital and Profits||Head office and internally generated funds||Head office and internally generated funds||100% from head office|
|Tax Rate||15%-30%||40%||40%||Not Applicable|
|Minimum No. of Director/AR||2||1||1||1|
|Minimum No. of Director resident in India||1||1||1||1|
|Timelines||7-10 Days||3-4 Months||3-4 Months||3-4 Months|
|Know More||Know More||Know More||Know More|