Top Business Setup place | Entity Formation

Setup Business in India

Liasion Office

LO or a representative office can be set up by a foreign company after making an application to the Reserve Bank of India. LO acts as a communication channel between the parent company and entity established in India. The main function of a LO is collection of information, promotion of exports/imports and facilitates technical/financial collaborations. It cannot undertake any commercial activity in India directly or indirectly and cannot generate any income in India.

For setting up a LO, the applicant foreign company should be engaged in manufacturing or trading activities with profit in the immediate preceding three financial years and should have a net worth of not less than USD 50,000 in its home country. All the expenses are to be met entirely through inward remittances of foreign exchange from the Head Office outside India.

Timeline

We at CorpAcumen Global ensure to undertake your comprehensive filing requirements and obtain necessary approvals from the Reserve Bank of India and Registrar of Companies. We aim to complete the process within 45-60 working days post obtaining necessary details from our clients.

Features

Permissible Activities

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.

Registration Requirements

Necessary filings are to be made to the Reserve Bank of India in Form FNC*
After obtaining approval from Reserve Bank of India, necessary documentations are to be filed with the Registrar of Companies in relevant form.

Time Limit for opening LO

LO shall be opened within 6 months from the date of confirmation from the Reserve Bank of India
Further extension of 6 months may be granted by AD Category-I bank for reasons beyond the control of the PROI.

Annual Compliances

Filing of Annual Activity Certificate in Form FNC
AAC is to be obtained from chartered accountant, depicting the status of the Project and certifying that the accounts of LO has been audited and the activities are in conformity with those allowed by the Reserve Bank of India
Filing of annual accounts with the Registrar of Companies within 6 months of the end of financial year

Documentation Required

Copy of the Certificate of Incorporation / Registration and charter documents of the foreign company
Audited Balance sheet of the applicant company for the last five 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
Power of Attorney in favor of signatory of Form FNC in case the Head of the overseas entity is not signing the Form FNC.

To be noted:

All the documents to be filed along with FNC form shall be legalised either through Indian Embassy or to be apostiled as per Hague convention.
If the originals are in a language other than in English, the same may be translated into English and notarized as above and cross verified/attested by the Indian Embassy/ Consulate in the home country.

Schedule the meet