Branch Office Registration of a Foreign Company in India - Complete Guide

What is Foreign Company Branch Office Registration in India?

If you are a foreign company planning to expand your business in India, setting up a branch office is a good option. A branch office is an extension of the foreign company in India and can engage in commercial activities as per the Indian laws. In this guide, we will take you through the process of registering a branch office of a foreign company in India, including the documents required, eligibility criteria, and other important details.

For foreign nationals, it is critical to select the right type of business structure that not only best suits your business objectives but also addresses liability and tax planning concerns.

Foreign companies that want to start a business in India should pay close attention to the Indian entry laws and international tax treaties. A foreign company may establish a business in India in accordance with the guidelines outlined in the RBI's FDI policy.

There are only two options for foreign nationals to start business in India, by setting up an Indian subsidiary company or by opening a branch office. Both can be possible either through an automatic route or through govt. approval route. Foreign entities can also establish project offices or liaison offices purely for non commercial activity.

One of the common strategies of the firms to expand their business at the international level is to set up branch offices at different places. Branch offices are a part of the parent organization, which are opened to perform the same or partially the same business operations as performed by the parent company to increase their reach.

Every branch office (BO)/ liaison office (LO) / project office (PO) shall get itself registered with the registrar of companies (ministry of corporate affairs) and obtain approval from RBI, Every branch office is registered as an establishment of foreign company in India. On such registration a CIN i.e., corporate identity number is allotted by the registrar of companies.

A branch office is suitable for foreign companies looking to set up a temporary office in India and do not intend to have long-term plans for the Indian operations; except for banking, shipping, and airlines, etc.

Liaison office is a place of business which functions as a communication center between the principal places of business/head office and entities in India, but it does not undertake any commercial, trading or industrial activity, directly or indirectly. It is not permitted to receive inward remittances from abroad.

Project office Foreign companies that have been awarded a contract to execute a project in India, select the mode of execution of the project, through project offices duly registered with the Reserve Bank of India. (RBI) and registrar of companies (ROC). ‘Project office’ is referred to as a temporary branch office of the foreign company to execute the project in India. The only difference between the liaison office and the project office is that the project office can carry out commercial activities pertaining to the particular project whereas The liaison office cannot execute any commercial activities.