annual compliance with RBI for Liaison office of any foreign

puran (Finance Officer) (48 Points)
Replied 24 October 2008

Dear Anshuman

Please note that a liaison office has to submit anually

1.Annual accounts duly certified by the chartered accountant.

They could be on mercantile or cash basis whatever is in practice from past, However no date as I think is there to submit these accounts.

regards

Puran Dangwal

From Liaison Office-Delhi.

CA. Dashrath Maheshwari (TaXpert) (15090 Points)
Replied 24 October 2008

A foreign company which has established a Branch Office or other place of business in India, in accordance with FERA / FEMA regulations, can acquire any immovable property in India, which is necessary for or incidental to carrying on such activity. The payment for acquiring such a property should be made by way of foreign inward remittance through proper banking channel. A declaration in form IPI should be filed with Reserve Bank within ninety days from the date of acquiring the property. Such a property can also be mortgaged with an Authorised Dealer as a security for other borrowings. On winding up of the business, the sale proceeds of such property can be repatriated only with the prior approval of Reserve Bank. Further, acquisition of immovable property by entities who had set up Branch Offices in India and incorporated in Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal and Bhutan would require prior approval of Reserve Bank to acquire such immovable property. However, if the foreign company has established a Liaison Office, it can not acquire immovable property . In such cases, Liaison Offices, can take property by way of lease not exceeding 5 years.

**DM

1 Like

CA. Dashrath Maheshwari (TaXpert) (15090 Points)
Replied 24 October 2008

Foreign Companies can set up their operations in India through

Liaison Office/Representative Office
Project Office
Branch Office

Such offices can undertake any permitted activities. Companies have to register themselves with Registrar of Companies (ROC) within 30 days of setting up a place of business in India.

Liaison office/ Representative office

Liaison office acts as a channel of communication between the principal place of business or head office and entities in India. Liaison office cannot undertake any commercial activity directly or indirectly and cannot, therefore, earn any income in India. Its role is limited to collecting information about possible market opportunities and providing information about the company and its products to prospective Indian customers. It can promote export/import from/to India and also facilitate technical/financial collaboration between parent company and companies in India.

The approval for establishing a liaison office in India is granted by the Reserve Bank of India (RBI).

Project Office

Foreign Companies planning to execute specific projects in India can set up temporary project/site offices in India. RBI has now granted general permission to foreign entities to establish Project Offices subject to specified conditions. Such offices cannot undertake or carry on any activity other than the activity relating and incidental to execution of the project. Project Offices may remit outside India the surplus of the project on its completion, general permission for which has been granted by the RBI.

Branch Office

Foreign companies engaged in manufacturing and trading activities abroad are allowed to set up Branch Offices in India for the following purposes:

Export/Import of goods
Rendering professional or consultancy services
Carrying out research work, in which the parent company is engaged.
Promoting technical or financial collaborations between Indian companies and parent or overseas group company.
Representing the parent company in India and acting as buying/selling agents in India.
Rendering services in Information Technology and development of software in India.
Rendering technical support to the products supplied by the parent/ group companies.
Foreign Airline/shipping Company.

A branch office is not allowed to carry out manufacturing activities on its own but is permitted to subcontract these to an Indian manufacturer. Branch Offices established with the approval of RBI, may remit outside India profit of the branch, net of applicable Indian taxes and subject to RBI guidelines Permission for setting up branch offices is granted by the Reserve Bank of India (RBI).

Branch Office on "Stand Alone Basis"

Such Branch Offices would be isolated and restricted to the Special Economic zone (SEZ) alone and no business activity/transaction will be allowed outside the SEZs in India, which include branches/subsidiaries of its parent office in India. No approval shall be necessary from RBI for a company to establish a branch/unit in SEZs to undertake manufacturing and service activities subject to specified conditions.

Application for setting up Liaison Office/ Project Office/ Branch Office may be submitted in form FNC 1 (available at RBI website at www.rbi.org.in)

**DM

ANSHUMAN KHANDELWAL (JOB) (311 Points)
Replied 24 October 2008

this info is already with me.i wanna know whether any annual certification/documentation has to submitted wit RBI.if yes then pl give details

Kumar (Legal Consultant) (358 Points)
Replied 24 October 2008

Dear Anshuman,

Annually Liaision office has to file the following docuemnts/reprot:

1.Activity report duly prepared and certified

2.Annual Accounts duly audited by your CA and certified thereof.

Also in the ROC Delhi the Form 52 has to filed.If your laision office is outside the Delhi or beyond the jurisdiction pf ROC delhi than in that case you have to also file the copy to the respective jurisdictional ROC.

Hope this clarify your query.

Regards,

ANSHUMAN KHANDELWAL (JOB) (311 Points)
Replied 24 October 2008

thanks a `lot.pl also let me know due dates of the same.bec.till yet we have not filled any doc. to RBI or ROC for Liaision office.

Thanks in advance

(Guest)

Is it compulsory to submit the Annual accounts of the Parent compnay while filling of form no. 52 in ROC of the liason office ???

Ravi Sukumaran (Admin & Finance Officer) (21 Points)
Replied 20 January 2010

dear sir, what is the use of FORM 44 then.

BHAVIK DOSHI (DIRECTOR) (31 Points)
Replied 16 June 2010

Hi Ravi,

Form 44 is for Registration of a Foreign Company in India and

Form 52 is for Alterations in Charteres, MOA, AOA,(in Foreign country) Registered place, Authorised Representative, etc in India

Regards

Bhavik

+91.9840.58.2353

Manish (Partner) (26 Points)
Replied 31 October 2010

Dear All,

pl let me know abt compliance with RBI, ROC, FEMA, or under any other act for opening of represntative office out of india by an indian private limited company.....

please give me the list of forms for above compliance... pl reply urgent

thanks

DHARMIK (Associate) (95 Points)
Replied 02 February 2011

Hi All

Please let me know whether a liaison office of a non corporate foreign office is requied to get itself registered with the RoC??

Also let me know what are the details required to be submitted in the Annual Activity Certificate (AAC)??

Thanks and Regards

Parry (none) (23 Points)
Replied 07 March 2011

Please suggest how a liaison office not registered with ROC can obtain ROC report for the closure of the office in India ?

CA.RAJIV SHUKLA FCA (Practicing Chartered Accountant) (346 Points)
Replied 26 August 2012

FOR LIASION OFFICE IN INDA

We are filling Form, 52 Since 2007 for Annaul Account & Annaul Activity Certificate

but in 2012 filling of Form 52, ROC deamanded File World Accounts - Is its Totally wrong or correct reply with Facts

This is to inform you that in term of the provisions under Regulation 17 of the Companies Regulations, 1956, the above-cited Form52 dated 17-08-2012 filed by XYZ SYSTEM CO.LTD vide SRN B45644148 has been examined and marked as Pending for user clarification with the following remarks-

file world accounts for the same period

Liaison office/ Representative office

Liaison office acts as a channel of communication between the principal place of business or head office and entities in India. Liaison office cannot undertake any commercial activity directly or indirectly and cannot, therefore, earn any income in India. Its role is limited to collecting information about possible market opportunities and providing information about the company and its products to prospective Indian customers. It can promote export/import from/to India and also facilitate technical/financial collaboration between parent company and companies in India.