![]() įor Branch Office - not less than USD 100,000 or its equivalent.įor Liaison Office - not less than USD 50,000 or its equivalent. Track Record For Branch Office - a profit making track record during the immediately preceding five financial years in the home country.įor Liaison Office - a profit making track record during the immediately preceding three financial years in the home country. The following additional criteria are also considered by the Reserve Bank while sanctioning Liaison/Branch Offices of foreign entities: Applications from entities falling under this category and those from Non - Government Organisations / Non - Profit Organisations / Government Bodies / Departments are considered by the Reserve Bank in consultation with the Ministry of Finance, Government of India. Government Route - Where principal business of the foreign entity falls under the sectors where 100 per cent FDI is not permissible under the automatic route. Reserve Bank Route - Where principal business of the foreign entity falls under sectors where 100 per cent Foreign Direct Investment (FDI) is permissible under the automatic route. The applications from such entities in Form FNC (Annex-1) will be considered by Reserve Bank under two routes: GENERAL CRITERIA - LIAISON OFFICE / BRANCH OFFICEĪ body corporate incorporated outside India (including a firm or other association of individuals), desirous of opening a Liaison Office (LO) / Branch Office (BO) in India have to obtain permission from the Reserve Bank under provisions of FEMA 1999. RBI Compliances - Master Circular on Establishment of Liaison / Branch / Project Offices in India by Foreign Entities (RBI/2015-16/54 Master Circular No.7/2015-16)Įstablishment of Branch/Liaison/Project Offices in India by Foreign EntitiesĪ. The project office cannot operate after the completion of the specified project.Everything about Foreign Companies in India RBI will accord approvals specific to the project. The procedure for opening such an office is to apply to the RBI with details of the project to be executed and the details of the project office to be set up. Procedure to Set up a Project Office in India The project office is treated as an extension of the foreign corporation in India and is taxed at the rate applicable to foreign corporations. The foreign corporation which sets up such a project office is required to furnish a prescribed report to the concerned regional office of RBI under whose jurisdiction the project office is set up. The exchange control regulations prescribe certain additional requirements for setting up project office sans its approval. Such offices can not undertake or carry on any activity other than the activity relating and incidental to execution of the project. Pursuant to the setting up of the Project office, the Registrar of Companies needs to be intimated in Form 44, about the setting up of a place of business under Section 592 of the Companies Act, 1956. RBI has also granted general permission to foreign entities to remit the surplus on winding up/completion of projects through Authorised Dealers. A company or entity in India awarding the contract has been granted Term Loan by a Public Financial Institution or a bank for the projec.The project has been cleared by an appropriate authority or. ![]() The project is funded by a Bilateral International Finance Agency or.The project is funded by inward remittance from abroad or.It has secured from an Indian company a contract to execute a project in India and.The RBI has granted a general permission to a foreign entity for setting up a project office in India subject to the following conditions: Foreign companies engaged in turnkey construction or installation normally set up a project office for their operations in India.Ī foreign corporation, which has secured a contract from an Indian company to execute a project in India, is allowed to establish a project office in India without obtaining prior permission from RBI. It is essentially a branch office set up with the limited purpose for executing a specific project. The project office is the ideal method for companies to establish a business presence in India, if the object is to have a presence for a limited period of time. "Project Office" means a place of business to represent the interests of the foreign company executing a project in India but excludes a Liaison Office.
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