Liaison Office Registration

Good Communication and transparency are the keys of growth of any company and a liaison office is a medium to maintain this between the offices established in foreign and Indian land.

Further, Foreign Exchange Management Act (FEMA) has also defined the Liaison Office as “a place of business to act as a channel of communication between the Principal place of business or Head Office by whatever name called and entities in India but which does not undertake any commercial / trading / industrial activity, directly or indirectly, and maintains itself out of inward remittances received from abroad through normal banking channel”.

Cross-border business practice is only not a trend of modern business practice but a need after globalization. The exploration of new market and in a new economy is a risk and a liaison office is a good option to test, try and minimize the risk.  In India, there are various institutions to guide and establish the liaison office such as RBI (Reserve bank of India) and FEMA, 1999.  Subsequently, there are rules, regulations and procedures to follow for the purpose.

Benefits & Advantages

  • One name one identity across the globe
  • Promotion and facilitation of the parent company business activities
  • Establishment of a better communication channel between head office and parties in India
  • Effective Study of Indian market
  • Tax benefits

Eligibility Criteria

Profit making track record of following:

  1. Preceding three financial years in the home country
  2. Net worth of not less than USD 50,000 or its equivalent

Permitted Activities of a Liaison Company

  • Representing in India the parent company/group companies
  • 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

Requirements

  • Place of Business
  • Bank Account
  • Permanent Account Number (PAN)
  • Tax Deduction Account Number
  • GST Registration

Procedure

STEP 1: Attestation of Parent Company’s Incorporation document by Indian Embassy present in the parent company.

STEP 2: Application of establishment of branch office in Form FNC to a designated AD Category - I bank.

STEP 3: The AD Category-I bank shall forward a copy of the application to the Reserve Bank of India for allotment of Unique Identification Number (UIN).
RBI considers those applications under two categories for permission:

  1. First Category: Where principal business of the foreign entity falls under sectors where 100 percent FDI is permissible, under this category RBI does not need consultation with government.
  2. Second Category: Where principal business of the foreign entity falls under the sectors where 100 percent FDI is not permissible, under this category and also the applications of non-government organizations are considered by the RBI in consultation with the Ministry of Finance, Government of India.

STEP 4:  After receipt of the UIN from the Reserve Bank, the AD Category-I bank shall issue the approval letter to the non-resident entity for establishing BO/LO in India.

STEP 5:  An applicant that has received a permission for setting up of a BO/LO/PO shall inform the designated AD Category I bank as to the date on which the BO/LO/PO has been set up. The AD Category I bank in turn shall inform Reserve Bank accordingly.

STEP 6: Application to Ministry of Corporate Affairs in Form FC-1 to obtain a CIN (Corporate Identity Number).

STEP 7: Registration with police authorities for applicants from Bangladesh, Sri Lanka, Afghanistan, Iran, China, Hong Kong, Macau or Pakistan desirous of opening liaison office in India.

The establishment of liaison office can establish only after approval of from the Department of Banking Regulation (DBR), RBI.

It is generally for three years but in the case of Non-Banking Finance Companies (NBFCs) and those entities engaged in construction and development sectors, for whom the validity period is two years only.

The requisites are as follows:

  1. Permanent Account Number (PAN)
  2. Comply with accounting procedure:

    a. Keeping a Book of accounts

    b. Auditing of company’s annual account

  3. Liaison has to file for an Annual Activity Certificate with the RBI
  4. Liaison has to deposit the annual return and annual balance sheet to Registrar of Companies (RoC).
  5. Notify the following activities to the RoC & RBI:-

    a. Any change related to liaison office

    b. Changes in parent company such as company’s directors or modification in any funding pattern or documents.

  6. Digital Signature Certificate
  7. Place of business
  8. Bank Account
  9. Proper follow up of accounting procedure as guided by Companies Act, 2013

Liaison office needs to obtain prior permission of the RBI through its AD Category – I bank justifying the reason for the additional account.

Yes, it is important to translate the document in English and certify it by company if the documents are in language other than English for the purpose.

Yes, this is the guiding footprints to achieve the goal of opening a liaison office in India.

Yes, it is important to appoint local representative in India.

Company’s representative will appoint local representative.

What's included

  • Drafting of Documents
  • Filing of Form FNC with RBI through AD bank
  • Digital Signature of the Authorised Signatory
  • Filing of Form FC-1 with ROC
  • Registration with Local Police
  • PAN and TAN Registration
  • Consultation with our Experts

Documents Required

  • Letter of Comfort
  • Details of shareholders of Applicant Company
  • Shareholding structures of the company
  • NOC from state police authorities applicable for few countries.
  • Details in respect of Directors/ Key Executives with contact information
  • Audited Balance sheet of the applicant company for the last three years.
  • Company’s incorporation documents attested by Indian Embassy present in the country of parent company
  • Appointment letter of local representative in India appointed by company’s representative.
  • Copy of the Certificate of Incorporation / Registration; Memorandum of Association and Articles of Association attested by the Notary Public in the country of registration.
  • Bankers' Report from the applicant’s banker in the host country / country of registration showing the number of years the applicant has had banking relations with that bank.
  • Power of Attorney in favour of signatory of Form FNC or representative/ manager of liaison office in case the Head of the overseas entity is not signing the Form FNC.

Liaison Office Registration


Foreign companies can enter Indian market by establishing a Liaison Office to set up communications with local government and businesses. Get you Liaison Office Registration now with Filecrat and get free consultation.

₹59,999.00

Onwards

In 15 Working Days

Request For Callback

We'll never share your email with anyone else.

WHY CHOOSE FILECRAT?

EXPERIENCED
TEAM

With 40+ man-years of experience, we have expertise in filing

TRANSPARENT
PRICING

We disclose professional fees separately and provide you with all the government fee receipts

DATA
CONFIDENTIALITY

We ensure to protect your data from unauthorized access out of websites and database.

OVERALL
ACCURACY

Our team follow the sequence of instructions so the output will be consistently accurate.