Friday, 29 May 2020

Branch Office in India

What activities can a branch office perform in India?
The branch office are often opened by any foreign company. The activities it can undertake are mentioned below:
  • 1 Export/Import of products
  • 2 Rendering consultancy services
  • 3 Carrying out research work, during which the foreign parent company is engaged.
  • 4 Promoting technical or financial collaborations between Indian companies and parent or overseas group company.
  • 5 Representing the parent company in India and acting as buying/selling agents in India.
  • 6 Rendering services in Information Technology and development of software in India.
  • 7 Rendering technical support to the products supplied by the parent/ group companies.
  • 8 A branch office cannot perform manufacturing activities on its own but can subcontract these to any manufacturer based in India. Branch Offices can remit the profits to its parent company after paying taxes on an equivalent (RBI).
Who is that the approving authority for branch office?
Reserve bank of India is that the nodal authority to urge the permission to start out a branch office in India

How much time does it fancy setup a branch office in India?
The Branch office could also be registered in 45–60 days

What are the pre requisites to start out a branch office in India?
  • 1 The name of Indian Branch office should be same as that of a parent company.
  • 2 The Branch is simply extension of the exiting company within the foreign country.
  • 3 All the expenses of the BRANCH office are met by the top office, if it doesn’t have the revenue from Indian operations.
  • 4 The foreign parent company getting to setup a Branch office should have a profitable diary during immediately preceding 5 years.
  • 5 The Net worth of the foreign company should be quite or adequate to USD 100,000. The networth certificate should be
  • 6 A branch office is is suitable for foreign companies looking to setup a short lived office in India and not interested or not getting to have future plans for the Indian operations; except banking, shipping and airlines etc. mentioned above.
Documents required for forming a Branch Office in India
The application for forming a branch office is to tend to the bank in India. The bank then submits the appliance to RBI for approval.

The following documents are required to open a branch office in India:
  • A Indian resident who are going to be liable for branch operations and can be susceptible to make the tax payments and regular compliances Form FNC 1 (Three copies)
  • 1 Letter from the principal officer of the Parent company to RBI.
  • 2 Letter of authority from the parent company in favor of Local Representative.
  • 3 Letter of authority/ Resolution from parent company for fixing BRANCH office in India.
  • 4 Comfort letter from the parent company meaning to support the operation in India.
  • 5 Two copies of English version of the Certificate of Incorporation, Memorandum & Articles of association (Charter Document) of the parent company duly attested by the Indian embassy or notary within the country of registration.
  • 6 Certification of Incorporation — Translated & Duly Notarized and properly authenticated.
  • 7 The Latest audited record and annual accounts of parent company duly Translated notarized for past Three years and properly authenticated
  • 8 Name, Address, email ID and phone number of the authorized person in Home Country.
  • 9 Details of Bankers of the Organization the Country of Origin along side the checking account number
  • 10 Commitment from the Organization to the effect that it’ll be hospitable report / opinion sought from its banker by the govt of India / Federal Reserve Bank of India
  • 11 Expected funding level for operations in India.
  • 12 Details concerning address of the proposed local office, number of persons likely to be used , number of Foreigners among such employees and address of the top of the Local office, if decided
  • 13 Details of Activity administered in Home Country by the applicant organization in short about the merchandise and services of company in short .
  • 14 Bankers Certificate from the bank of the parent company about the small print of parent company and duration of banking with parent company
  • 15 Latest Proof of identity of all the administrators — Properly Certified by Banker in Home Country and duly authenticated
  • 16 Latest Proof of address all of Directors — Properly Certified by Banker in Home Country and duly authenticated
  • 17 Details of the Individuals / Company holding more 10% of Equity
  • 18 Structure of the Organization and its Shareholding pattern
  • 19 Complete KYC of Shareholders holding quite 10% Equity within the Applicant Company
  • 20 Resolution for Opening up checking account with the Banker
  • 21 Duly Signed checking account Opening Form for Indian Bank
  • 22 The application for BRANCH office Licenses is approved by the RBI, but as per the recent changes the applications for BRANCH office are routed through the Authorized Dealers (AD). thanks to this the timeline for fixing the BRANCH office has increased tremendously. Further the documentation required for an equivalent has also increased to an excellent extent.
Post Incorporation Procedural Requirements
After Incorporation, the subsequent registrations also are necessary for a branch office:
  • 1 Permanent account number — PAN
  • 2 Tax deduction number — tan number Shop & establishment
  • 3 Registration GST Registration if providing services to Indian Customers
  • 4 What are the compliances after the Branch Office is made in India?
Every year a branch office is required to undertake the subsequent activities:
  • 1 Book Keeping
  • 2 Audit
  • 3 Annual activity Certificate with RBI
  • 4 Filling of financials with Registrar of Companies
For more information Click here

No comments:

Post a Comment