Project Office Registration
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Project Office Registration
The project office is the method of foreign companies to execute an awarded project in India. It is required for the project office to register with the Reserve Bank of India (RBI) and the Registrar of Companies (ROC). The objective of such establishment is for limited purpose and time-period.
Benefits & Advantages
- Easy execution of project
- Consistency in the development of project
- Progress analysis becomes easy
- Establishment of a better communication channel between head office and clients in India
- Effective Study of Indian market
- The foreign company has secured a contract from an Indian company to execute a project in India
- The said project is funded directly by inward remittance from abroad
- The project has been cleared by an appropriate authority
- The project is funded by a bilateral or multilateral International financing agency
- A company or entity in India awarding the contract has been granted term loan by a public financial institution or a bank in India for the project
- Place of Business and NOC from the owner of the premises
- Bank Account
- Permanent Account Number (PAN) from the Income Tax Authorities
- Tax Deduction Account Number
- GST Registration
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 the application to the Reserve Bank of India
STEP 4: Application to Ministry of Corporate Affairs in Form FC-1 to obtain a CIN (Corporate Identity Number)
STEP 5: Registration with police authorities for applicants from Bangladesh, Sri Lanka, Afghanistan, Iran, China, Hong Kong, Macau or Pakistan desirous of opening project office in India
- 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
- Company’s incorporation documents attested by Indian Embassy present in the country of parent company.
- Structure of the Company.
- Particulars of the authority awarding the projects / contract and other details of the contract.
- Contact details of the Project Office.
- Brief details of the Project
- An undertaking to the effect that the Project Office is eligible to avail of the General Permission under Regulation 5.
- Details in respect of Directors/Key Executives and their declaration.
- Contact details of the authorized person in Home Country.
- Details of shareholders of Applicant Company.
- Shareholding structures of the company.
- Letter of Comfort.
- Copy of the Certificate of Incorporation / Registration; Memorandum of Association and Articles of Association attested by the Notary Public in the country of registration.
- NOC from state police authorities applicable for few countries.
- Audited Balance sheet of the applicant company for the last three years.
- 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.
- Appointment letter of local representative in India appointed by company’s representative.
- 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.
The sole purpose is to executing a specified project in India for a limited period of time.
Project Office can undertake commercial activities related to the particular project whereas the liaison office cannot.
The conditions in which RBI consults government:
- When principal business of concerning company falls in defence or telecom or private security/ information and broadcasting sector.
- If the entity belonging to Pakistan, Bangladesh, Sri Lanka, Iran, Afghanistan, China, Macau and Hong-Kong desires to open project office in Jammu & Kashmir, North Eastern States and Andaman and Nicobar Islands.
When principal business of concerning company falls in defence or telecom or private security/ information and broadcasting sector.
RBI approval will not be required if the concerned contract for which the PO is opened in India has been awarded by the Ministry of Defence or Service Headquarters or Defence Public Sector Undertakings.
Time limit for opening of a project office:
- The office shall be opened within 6 months from the date of approval letter.
- Extension for 6 months may be granted by AD Category-I bank for reasons beyond the control of the person resident outside India.
- Further extension may be granted by RBI only.
It remains valid for the tenure of the project.
The project office can only maintain non-interest bearing current accounts with AD Category –I banks subject to following conditions:
- The PO has been established in India as per the applicable regulations.
- The contract governing the project specifically provides for payment in foreign currency.
- The foreign currency accounts have to be closed at the completion of the project.
- Each PO can open 2 foreign currency accounts, usually one denominated in USD and the other in home currency of the project awardee but both shall be maintained with the same AD Category–I bank.
- They can be used only for payment of project related expenses and receiving foreign currency from the Project Sanctioning Authority and remittances from parent/group company abroad or bilateral / multilateral international financing agencies.
- The responsibility of ensuring that only the approved debits and credits are allowed in the Foreign Currency Account shall rest solely with the branch concerned of the AD. Further, the Accounts shall be subjected to 100 per cent scrutiny by the Concurrent Auditor of the respective AD banks.
Yes, this is the guiding footprints to achieve the goal of opening a liaison office in India.
The compliances of a newly established project office:
- Reporting to the Director General of Police (DGP) of the state concerned where the project office has been established within five working days of the PO becoming functional. The copy of the report in should also be filed with AD Bank by the newly established Project Office.
- Comply with accounting procedure:
• Keeping a Book of accounts
• Auditing of company’s annual account
- File an annual activity certificate with the RBI
- File annual return and annual balance sheet to Registrar of Companies (RoC)
- Notify the following activities to the RoC & RBI: -
• Any change related to project office
• Changes in parent company such as company’s directors or modification in any funding pattern or documents