Sanjeev Kumar |Updated : January 07, 2025

Stepwise Procedure for Registration of Branch Office, Liaison Office or Project Office of a Foreign Company in India

Overview :This blog provides a comprehensive guide to setting up a Branch Office, Liaison Office, or Project Office in India under the provisions of the Foreign Exchange Management Act (FEMA) and RBI’s Master Direction. It begins by clarifying the eligibility criteria for each office type—highlighting the required track record, net worth, and permitted business activities—before explaining the documentation essentials, legalization requirements, and the step-by-step application process via an Authorized Dealer Bank. The blog then deals with the post-approval steps, including registration with the ROC, obtaining registrations like PAN, TAN, and GST, and opening a bank account.

The establishment of a Branch office in India is regulated under the Foreign Exchange Management Act. The most relevant and latest law is contained in the master direction issued by the Reserve Bank of India (RBI) on January 01, 2016, which is further updated from time to time. The aforesaid Master Direction lays down the detailed and conclusive procedure to establish a place of business by a foreign company or a group of companies in India. These guidelines do not apply to a subsidiary company incorporation in India under the Companies Act, 2013, which is otherwise allowed under automatic route for most of the sector.

Step-1: Eligibility Check

The foreign company can establish its business without incorporating a separate legal entity in India, like a wholly owned subsidiary in the form of a Branch office, liaison office (also known as a representative office), or project office. Click here to read the significant differences between a Subsidiary and a Branch Office. The first step is to check the eligibility for setting up a branch office, liaison office or project office in India. The applicant's foreign company must be five years older, have a track record of consistent profitability, and have a net worth of over USD 1,00,000. On the other hand, for liaison office setup, the applicant company must be three years old and have a consistent track record of profitability and a net worth of more than USD 50,000. The project office can be set up to execute a project under an agreement with the government, public or private sector company. The eligibility check is one of the essential aspects, and we offer no-obligation consultation without any fee.

Eligibility Criteria for BO, LO or PO

Step-2: Arranging the documents (List of Documents)

The second most important aspect is understanding the list of documents required to set up a branch, liaison, or project office for the foreign company. Very basic documents such as the Certificate of Incorporation, Articles of Association, Audited Financial Statements, and the CPA or statutory auditor Certified net-worth certificate are submitted for the applicant entity. We help you draft the necessary resolutions and authorisations in favour of an authorised signatory in India. We further assist you in preparing an application to establish the branch, liaison, or project office, including the FNC Form, Certain undertakings, and declarations.

Step-3: Attestation or Legalisation of Documents

A document of foreign origin or executed in a foreign country needs legalisation before it is submitted to the RBI for establishment of the Branch, liaison, or Project Office Legalization can be done three ways, depending on the country. For the commonwealth nations, the notary public attestation is accepted in India, which is simpler and easier to obtain. In case the applicant is from a non-commonwealth nation, then check if it is part of the Hague Convention; if the country is a party to the Hague Convention, the apostille attestation from the designated apostille office is accepted. In practice, many “commonwealth” countries are also Hague signatories (e.g., the UK, Australia, Canada), so the usual route is often apostille rather than just notarial attestation. If the country is neither in commonwealth nor a party to the Hague convention, then the documents need attestation by the Indian Embassy.The safest route (and the most common RBI/ROC requirement) is usually either apostille (if from a Hague Convention signatory) or Indian Embassy/Consulate attestation (if from a non-Hague country).

Step-4: Filing of FNC Form with AD Category 1 Banker (RBI)

The application for establishing a Branch, liaison or project office is submitted in the prescribed FNC form to the RBI through AB Bank (also known as an authorised dealer of the RBI). The AD Bank plays a very significant role in the establishment of the BO, LO or PO and acts as a communication channel between the applicant and the regulator, i.e. RBI. The AD bank is primarily responsible for the vetting of documents. On their recommendation, the RBI issues permission to set up the Branch, liaison or Project office in India. However, If the proposal does not fall under the automatic route (e.g., the sector is restricted or the applicant does not meet eligibility norms), then the AD Bank refers it to RBI for prior approval.

Step-5: Verification of KYC from Banker of Parent Company

After filing the FNC Form, the AD Bank sends a swift message to verify the authenticity of certain information, such as the KYC of the applicant, to the overseas banker of the parent company. A positive and affirmative reply from the applicant banker is necessary for the application to be processed in India. The RBI, through the AD Banker, may seek certain clarification or any further documents on a case-to-case basis.

Step-6: Approval of RBI

There is a specific policy of approving the establishment of a branch, liaison or project office in India by the AD Banker itself and only cases where the automatic route is not available the cases are forwarded for prior approval of the RBI. The process of approval after swift verification is of a week time. The RBI in their approval letter also allots a UIN for every applicant.

Step-7: Registration of Foreign Company with the ROC

Within 30 days of obtaining approval from the RBI about the establishment of a Branch Office, Liaison Office or Project Office, the foreign company must register with the Registrar of Companies by filing an online application at www.mca.gov.in in the prescribed form FC-1. The office of the Registrar of Companies issues a certificate of registration of the foreign company in India after the approval of the application filed in FC-1.

Step-8: PAN Card, TAN, GST & Bank A/c Opening

The branch office is a taxable entity in India, and for compliance with the obligations of Income Tax Payment and Return filing, the Income Tax Department issues a unique ten-digit Permanent Account Number (PAN), for which the application must be filed in the prescribed form 49AA. Every business in India also has an obligation to deduct tax at source while paying to its vendors, also known as withholding tax; for this purpose, a Tax Deductor Number known as TAN is required. The supply of goods or services is taxable under GST, and for that purpose, registration under GST is needed. The bank accounts also need to be opened for the smooth working of the branch office.

We Help in Setting up Branch, Liaison or Project Office!

We are a group of experienced professionals who have substantial experience in setting up the business for the foreign corporation in India and continue to assist them in their tax filing, compliance of regulations and other statutory reportings. As said earlier, the first consultation session is completely without any fee, therefore we encourage you to book a consultation with us.

Conclusion

Setting up a place of business for a foreign company in India requires adherence to RBI regulations and rules for registering foreign companies in India. Setindiabiz is pivotal by leveraging its in-depth knowledge and professional network to handle the end-to-end process—from eligibility assessment and document preparation to regulatory filings and post-setup compliance. With a team of experienced professionals, Setindiabiz ensures that foreign entities can efficiently navigate each step while staying fully compliant, and the first consultation is offered at no cost, enabling companies to explore their India-entry strategy with expert guidance right from the outset.