25+ YEARS
OF LEGAL EXPERIENCE
Legal counsel for foreign companies establishing Branch, Liaison and Project Offices in India, including regulatory, corporate and compliance requirements.
Foreign companies considering a business presence in India may establish different forms of presence depending on the nature and objectives of their proposed activities. Branch Offices, Liaison Offices and Project Offices serve different purposes and are subject to distinct legal and regulatory requirements.
The appropriate structure depends on factors such as the nature of the proposed activities, the intended duration and scope of operations, applicable foreign exchange regulations and the regulatory framework governing the particular business.
Rajkishore Associates advises foreign companies on evaluating and establishing an appropriate presence in India and on the legal and regulatory requirements associated with each structure.
A Branch Office can provide a foreign company with a presence in India for carrying out activities permitted under the applicable regulatory framework.
Depending on the circumstances and applicable permissions, a Branch Office may undertake activities such as representing the foreign parent, carrying out permitted business activities, providing professional or consultancy services, undertaking research and other activities permitted under the applicable regulations.
The activities of a Branch Office are subject to the conditions applicable to the approval and the prevailing regulatory framework.
A Liaison Office, also known as a Representative Office, is generally intended to act as a communication and representative channel between the foreign parent and parties in India.
A Liaison Office is not permitted to undertake commercial or trading activities or earn income in India. Its activities are generally limited to those permitted under the applicable regulatory framework.
A Liaison Office may therefore be considered where a foreign company wishes to explore the Indian market, establish business contacts and facilitate communication between its overseas operations and potential Indian customers or business partners.
A Project Office may provide a foreign company with a presence in India for undertaking activities connected with a specific project in India, subject to the applicable regulatory requirements and conditions.
The scope of activities of a Project Office is linked to the relevant project, and the office is generally intended to operate in connection with that project rather than as a general business establishment.
The legal and regulatory requirements applicable to a Project Office should be assessed based on the nature of the project, the foreign entity involved and the applicable permissions and regulations.
The choice between a Branch Office, Liaison Office and Project Office depends on the foreign company's objectives and the activities it proposes to undertake in India.
A foreign company may need to consider:
The nature and scope of the proposed business activities and whether commercial or revenue-generating activities are contemplated.
The purpose of the proposed Indian presence and the intended duration and scope of operations.
Applicable foreign exchange regulations, sector-specific laws and other regulatory conditions.
The reporting, filing and other continuing compliance obligations associated with the proposed structure.
A careful assessment at the outset can help ensure that the proposed Indian presence is structured in accordance with the applicable legal and regulatory framework.
The establishment and operation of Branch, Liaison and Project Offices by foreign entities are regulated under India's foreign exchange framework. The applicable requirements should be examined before establishing the proposed office.
Each form of office has a different permitted scope of activities. In particular, a Liaison Office cannot be used to undertake commercial activities or earn income in India.
Depending on the proposed structure and circumstances, regulatory approvals, registrations and filings may be required. The applicable requirements should be assessed before commencing operations.
Once established, the office may be subject to continuing reporting, filing and other compliance requirements. These should be addressed throughout the period of operation.
Additional approvals, licences or regulatory requirements may apply depending on the nature of the business activities proposed to be undertaken in India.
The tax implications should also be considered when selecting the appropriate form of presence in India. Branch Offices of foreign companies are generally subject to the tax rates applicable to foreign companies, which may be higher than rates applicable to an Indian domestic company.
A Branch Office of a foreign company is generally subject to tax in India at the rates applicable to foreign companies. The applicable tax regime should be evaluated together with the regulatory and compliance implications of the proposed structure.
A Liaison Office is not permitted to undertake commercial activities or earn revenue in India. Where the office operates strictly within its permitted activities and does not earn taxable income in India, it would generally not have corporate income tax liability on commercial income in India. The specific tax position should nevertheless be assessed based on the activities actually undertaken and the applicable tax laws.
Rajkishore Associates advises foreign companies on the legal and regulatory aspects of establishing and operating Branch, Liaison and Project Offices in India, including:
Advising on the appropriate form of business presence based on the foreign company's objectives and proposed activities.
Advising on the applicable foreign exchange, corporate and regulatory framework.
Assisting foreign companies with the legal requirements associated with establishing and operating Branch Offices in India.
Advising on the establishment and permitted activities of Liaison Offices in India.
Advising foreign companies on the establishment and operation of Project Offices for projects in India.
Preparing and reviewing documents required for establishing and maintaining the proposed Indian presence.
Advising on continuing statutory, regulatory and reporting requirements.
Advising on the legal and regulatory aspects of closing an office or considering an alternative form of business presence where appropriate.
Establishing a presence in India requires more than selecting an office structure. The proposed activities, regulatory framework and long-term objectives of the foreign company must all be considered.
Rajkishore Associates advises foreign and multinational companies on business formation, corporate structuring, foreign investment, commercial matters and regulatory requirements in India.
The firm's experience enables it to provide practical legal advice to companies seeking to establish, operate or develop their business presence in India.
A Branch Office is an establishment of a foreign company in India permitted to undertake specified activities in accordance with the applicable regulations. A Branch Office may undertake permitted commercial activities in India, subject to the conditions and regulatory framework applicable to such offices.
A Liaison Office acts as a communication and representative office between the foreign company's head office and entities in India. It is not permitted to undertake commercial or trading activities or earn income in India and is required to maintain itself through permitted sources of funding.
A Project Office is an office established in India by a foreign company for carrying out activities connected with a specific project in India. Its activities are generally linked to the execution of the project for which it has been established and are subject to the applicable regulatory requirements.
A Branch Office may undertake specified commercial activities permitted under the applicable regulations, whereas a Liaison Office is primarily established to act as a communication and representative channel and is not permitted to undertake commercial activities or earn income in India.
No. A Liaison Office is not permitted to undertake commercial, trading or industrial activities, directly or indirectly, in India or earn income in India. Its activities are restricted to those permitted under the applicable regulatory framework.
Yes, subject to the eligibility requirements, permitted activities and regulatory conditions applicable to Branch Offices in India. The proposed activities and the foreign company's circumstances should be examined before determining the appropriate route for establishing a Branch Office.
The establishment of a Branch, Liaison or Project Office is regulated under the applicable foreign exchange regulations and RBI framework. Depending on the circumstances, the application is processed through an Authorised Dealer (AD) Category-I bank, and specific regulatory or governmental approvals may also be required.
Following establishment, the foreign company must also complete the applicable registration and compliance requirements under the Companies Act, 2013 and other applicable laws.
The Reserve Bank of India (RBI) regulates the establishment of Branch, Liaison and Project Offices in India. Applications are generally processed through an Authorised Dealer (AD) Category-I bank in accordance with the applicable RBI regulations and guidelines. In cases requiring prior RBI approval, the application is forwarded to the RBI by the Authorised Dealer.
Yes. A Branch, Liaison or Project Office established in India by a foreign company is required to be registered under the Companies Act, 2013. The foreign company is required to file the prescribed documents, including Form FC-1 within 30 days of establishing its place of business in India.
The office must also comply with the applicable periodic filing and other compliance requirements under the Companies Act, 2013.
A Branch Office of a foreign company is generally subject to the tax rates applicable to foreign companies, which may be higher than the rates applicable to an Indian domestic company. The tax implications, together with the applicable regulatory and compliance requirements, should be considered when deciding between a Branch Office and an Indian subsidiary.
Rajkishore Associates advises foreign companies on the legal and regulatory aspects of establishing Branch, Liaison and Project Offices in India. The firm assists with evaluating the appropriate structure, regulatory requirements, applications, registrations, corporate documentation and ongoing compliance requirements.
The firm also provides practical legal guidance on structuring the proposed Indian presence in accordance with the foreign company's business objectives and applicable Indian laws.
Contact Rajkishore Associates to discuss your Branch, Liaison or Project Office requirements in India.
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