Establishment of your office in India or Abroad

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A branch office is a suitable business model for companies looking to establish a temporary presence in Indian cities. The branch office serves as an extension of the head office business and carries on the same business and activity as that of its parent company. 

Foreign companies are allowed to set up a branch office in India. But unlike the case of setting up a company, a branch office requires approval from the Reserve Bank of India (RBI). Only upon getting the branch license from RBI, the foreign company is allowed to commence the operations.

BRANCH office is suitable for a foreign company to test and understand the Indian market with very strict control by the Reserve Bank of India, as it does allow the companies to do business but just to do the activity which is mentioned in the application of Branch office, Any additional activity to be carried by the Branch office shall be illegal.

Procedure for setting up a Branch Office in India by Foreign Company

  • Approval from RBI– Permission for setting up branch offices is granted by the Foreign Exchange Department, Reserve Bank of India, Central Office, Mumbai (note – Not by the RBI offices in respective state capitals)
  • Track Record of the company -Reserve Bank of India considers the track record of the applicant company, the activity of the company proposing to set up an office in India as well as the financial position of the company while scrutinizing the application. (note – for setting up a company, there are no criteria of checking the track record or financial position of the parent company)
  • The applications from such entities in Form FNC (Annex-1) will be considered by the Reserve Bank under two routes: The application in the prescribed form should be submitted to the RBI through the Authorized Dealer bank.

Reserve Bank Route— where principal business of the foreign entity falls under sectors where 100 percent Foreign Direct Investment (FDI) is permissible under the automatic route.

Government Route— where principal business of the foreign entity falls under the sectors where 100 percent FDI is not permissible under the automatic route. Applications from entities falling under this category and those from Non – Government Organizations / Non – Profit Organizations / Government Bodies / Departments are considered by the Reserve Bank in consultation with the Ministry of Finance, Government of India.

Procedure for Approval from RBI

Currently as per the RBI Requirement, the application for the branch office and BRANCH office is submitted through the Authorized dealer. The authorized dealer means the various institutions having banking licenses.

The application in the prescribed form (Form FNC) should be submitted to the RBI.

Required Documents

  • FNC form duly signed by AR;
  • Information about the parent company along with its certificate of incorporation attested by a Notary Public or the Indian Embassy in the country of registration;
  • The incorporation documents of the branch office to be established in India;
  • Proof of registered office;
  • Note on location or proposed activity;
  • The latest audited balance sheet of the applicant entity;
  • Board resolution to open a branch office;
  • KYC of the authorized signatory; and
  • Information about the local representatives of the parent company in the branch office.
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