Branch Office Registration in India

Branch Office Registration in India is a legal process that allows an existing company, whether Indian or foreign, to establish a branch office at a location different from its registered or head office. A branch office functions as an extension of the parent company and carries out business activities permitted by the head office. It does not have a separate legal identity and operates under the name and authority of the parent company.
This form of registration is ideal for companies looking to expand their business presence in India while maintaining centralized control.

Advantages of Branch Office Registration
Registering a branch office in India offers several strategic benefits:

·         Market Expansion: Companies can establish a strong presence in India and reach new customers.

·         Brand Visibility: A branch office enhances the credibility and recognition of the parent company in local markets.

·         Centralized Management: Parent companies retain full control over operations while delegating local execution to the branch office.

·         Cost-Efficient: It avoids the need to incorporate a new company while still operating legally in India.

·         Compliance and Legal Recognition: A registered branch office ensures adherence to Indian laws, enabling smooth business operations.

    Copies of Form FNC.

·         A letter to RBI from the Parent Company's chief officer.

·         A parent company letter of authority supporting the local representative.

·         Resolution or letter of approval from the parent firm authorizing the establishment of a liaison office in India.

·         Correspondence from the parent firm expressing its intention to assist with the operations in India.

·         Two authenticated English copies of the parent company's MOA, AOA (Charter Document), and Certificate of Incorporation duly certified by the Indian embassy or notary             public in the nation of registration.

·         The Indian Consulate has duly notarized, translated, and certified the Certificate of Incorporation.

·         The parent company's most recent audited balance sheet and yearly accounts, properly translated and notarized for the previous three years. & Approved by Directors &             Indian Consulate.

·         Name, address, phone number, and email address of the authorized representative in their home nation.

·         Information about the Organization's Bankers, including their nationality and bank account number.

·         A pledge from the organization to cooperate with requests for information or opinions from its banker made by the Reserve Bank of India and the Government of India.

·         The anticipated level of finance for operations in India.

·         Information Concerning the planned local office's address, the anticipated number of employees, the proportion of foreign workers, and, should it be chosen, the head of            the local office's address.

·         Briefly describe the company's products and services and the activities that the applicant organisation has undertaken in their home country.

·         Certificate of Bankers.

·         Current Identification Documentation for Every Director, Verified by the Consulate and Bank in the Home Country.

·         Most recent proof of address for each director, verified by the home country's banker and consulate.

·         Information about the People or Business Owning More Than 10% of the Equity.

·         Organizational Structure in Relation to Shareholding Pattern.

·         Full KYC verification for shareholders with more than 10% equity in the applying company.

·         Form for Opening a Bank Account for Indian Bank, properly signed.

The RBI is in charge of overseeing and regulating Branch Office registration and oversight in India. In India, there are primarily two paths for opening branch offices.

·         The RBI Route (automatic route) and

·         Central Government Route (Approval Route)

Approval is not required from the government or other authorities to establish a branch office under an automatic route.

Reserve Bank Route - In cases where the foreign entity's primary line of business is inside an industry, that allows 100% Foreign Direct Investment (FDI) under the automatic route.

Government Route - If the foreign entity's primary line of business is located in an industry where 100% FDI is prohibited under the automatic route. Applications from organizations that fulfil this description, as well as those from departments, government bodies, non-profit organizations (which The Reserve Bank evaluates), and non-government organizations in consultation with the Ministry of Finance, Government of India.

There are some of the additional points described below by the Reserve Bank while sanctioning Liaison/Branch Offices of foreign entities:

Track Record:

For Branch Office - A history of profits earned in the nation of origin during the five financial years prior.

·         According to the most recent audited balance sheet or account statement certified by a certified public accountant or any other registered accounts practitioner, net worth           is defined as the total of paid-up capital and free reserves, less intangible assets.

·         Not less than USD 100,000 or its equivalent is required for the Branch Office.

The foreign entity must submit the application for setting up a BO or LO in India through an AD Category I bank to the General Manager of the Foreign Exchange Department, Central Office Cell, Reserve Bank of India, New Delhi Regional Office, 6, Parliament Street, New Delhi-110 001, India. The application must be sent with the required paperwork, such as:

·         Certificate of Incorporation in English Version/ Registration or Memorandum and Association Articles attested by Indian Embassy or Notary Public in the Country of                       Registration.

·         Latest Audited Balance Sheet of the applicant entity.

Branch Office Registration in India is available for both Indian and foreign companies, subject to specific eligibility criteria. These requirements ensure that only legally compliant and financially sound companies can establish a branch office in India.

1. Eligible Entities
·         Indian Companies: Existing Indian companies incorporated under the Companies Act, 2013 can open branch offices at locations other than their registered office.
·         Foreign Companies: Companies incorporated outside India are eligible to open a branch office in India, subject to approval from the Reserve Bank of India (RBI).

2. Incorporation Requirement
·         The applicant company must have a valid Certificate of Incorporation in its home country.
·         Foreign companies must be legally registered and compliant with corporate regulations in their country of origin.

3. Financial Requirements
·         The parent company must be financially sound and have a proven track record of business operations.
·         Banks or regulatory authorities may require proof of financial stability before approving branch office registration.

4. Business Activity Restrictions
·         The branch office must conduct business activities permitted under Indian law and approved by the parent company.
·         Certain regulated sectors, such as banking, insurance, and financial services, may require special approvals or licenses.

5. Regulatory Compliance
·         Foreign companies must obtain RBI approval if they plan to establish a branch office in India.
·         Compliance with the Companies Act, 2013, and other applicable Indian laws is mandatory.
·         The branch office must appoint an authorized representative in India who can liaise with authorities.

6. Other Requirements
·         The parent company should not have any ongoing legal restrictions or prohibitions that prevent it from opening a branch office in India.
·         The branch office must have a local address in India to operate legally.

Permitted Activities of Branch Office in India

·         Export and import-related activities.

·         Professional or consultancy services, subject to sectoral regulators policy or approval.

·         Conduct research work for areas where the parent company is engaged.

·         Engage in activities which promote technical or financial collaboration between Indian companies and parent or overseas group company.

·         Act as a buying or selling agent in India or to represent the parent/group company.

·         Engage in any business or technical activities for software development or for the rendering of any service-related information technology.

·         Provide technical support services to the clients in India for the goods or services supplied by parent/group company.

·         Act as an authorised representative for a foreign shipping or airline company in India.