The Liaison Office (LO) in any foreign country represents the parent company in that country, paving the way for its business expansion, progress, and growth in the targeted country. A liaison office does not carry on any commercial or business activities, and its scope is limited to making liaison and business promotional activities.
Today, companies and firms engaged in various fields of the commercial, professionals, and service sectors are actively involved in establishing proper liaison office in well-developed and fast progressing countries of the world, for the ultimate purposes of business expansion to international markets and maximal business profits.
As India is one of the major and rapidly progressing economies of the world, most of the major and multinational corporations are deeply interested in setting up their well-established liaison offices in India. The whole procedure for foreign liaison office registration in India, is separately described in the lower section of this highly informative article.The liaison office registration in India is permitted by RBI to perform the following functions only:
- To represent the parent company or firm in India, and promote its business activities
- Explore opportunities for promotion of its business in India
- Act as a convenient and responsible communication link between the parent company and the Indian companies
- Promote exports/imports of goods and services from/to India
- Facilitate innovative technical support or lavish financial collaboration between the parent company and the Indian companies
Procedure for Foreign Liaison Office Registration in India
For proper liaison office registration in India, prior permission of the Reserve Bank of India (RBI) is mandatory. Before granting approval to the setting up of a liaison office by any foreign company anywhere in India, the RBI is bound to know all about the applicant (parent) company, its background, objectives of the proposed liaison office, the officials of the liaison office, etc. Such a permission to the inception of the liaison office is generally given for a period ranging from one year to three years, upon the expiry of which punctual renewal of the same is recommended.
After getting permission from the RBI, the registrar of companies appointed in the concerned State of India is resorted to for further processing. Thereafter comes the turn of the tax and customs registration procedures, for administration and management of the liaison office. Ours well-informed and proficient legal professionals help foreign companies and firms comprehensively, during the entire procedure for foreign liaison office registration in India, in the desired city of India.
- Well-completed Form FNC-1 in Triplicate
- A letter (on company's letterhead) in English to the RBI from the Director/ Principal Officer/CEO of the parent company, that bears request for setting up a Liaison Office in India, for the specified intentions.
- An authorization letter from the parent company in favor of the local representative
- The MOA and AOA of the parent company in English, duly attested by the Indian Embassy/Notary Public of the concerned country of registration
- The latest well-audited balance sheet of the applicant company
- Details of all the activities which will be carried out by the proposed liaison office
- Details about the office bearers in the desired liaison office
- Bankers report in favor of the parent company being honest and trustworthy
- And, other documents that RBI may deem necessary for granting approval