#IndiaRegulations

[fusion-compliance-services]

BIS-CRS Certification: Your Gateway to Compliance with Fusion Compliance Services

The BIS Compulsory Registration Scheme (CRS) certification is an essential mark for electronics and IT products manufactured or imported into India. This certification ensures products meet Indian safety and quality standards, making it crucial for businesses aiming to establish trust with consumers. At Fusion Compliance Services, we specialize in guiding companies through the BIS-CRS certification process, helping them secure compliance efficiently and effectively.

What is BIS-CRS Certification?

The Bureau of Indian requirements (BIS) implemented the Compulsory Registration Scheme (CRS) to guarantee that particular electrical and IT goods meet Indian safety requirements. This certification, mandated by the Electronics and Information Technology Goods (Requirement of Compulsory Registration) Order of 2012, compels manufacturers to register their goods with the BIS before selling them in the Indian market.

BIS-CRS is required for a wide range of electrical and information technology goods, including computers, tablets, LED lights, and mobile phones. Manufacturers who receive BIS-CRS certification may ensure that their goods are safe, high-quality, and comply with Indian regulations.

The Importance of BIS-CRS Certification

Product Safety: BIS-CRS ensures that products comply with rigorous safety standards, preventing hazards associated with electronics.

Consumer Trust: Certified products signal reliability and quality, enhancing customer trust and brand loyalty.

Legal Compliance: For manufacturers and importers, BIS-CRS certification is a legal requirement, ensuring smooth market entry and eliminating regulatory risks.

Market Access: Products with BIS-CRS certification can access a broader market in India, leading to higher sales and competitive advantage.

The BIS-CRS Certification Process

BIS-CRS certification entails numerous processes that need both technical skill and precise documentation. Fusion Compliance Services simplifies and relieves stress by providing end-to-end guidance and support.

Product Testing: The process begins with testing the product in a BIS-recognized laboratory. Testing is necessary to ensure that the product complies with the specific standards applicable under BIS-CRS.

Documentation: After testing is completed, a set of needed papers, including test results, are generated and submitted with the application. To prevent delays, our staff helps compile, examine, and finalize the relevant papers.

Application Submission: The application for BIS-CRS is submitted to the Bureau of Indian Standards, including test reports and supporting documents.

Grant of Certification: Once the application is approved, BIS grants a unique registration number, certifying that the product complies with Indian standards. This registration number must be displayed on the product packaging to verify compliance.

Ongoing Compliance: BIS-CRS certification requires manufacturers to adhere to compliance standards continually. We provide ongoing support to ensure that businesses remain compliant, including re-certification and updates as necessary.

How Fusion Compliance Services Can Help

Fusion Compliance Services is dedicated to assisting businesses in achieving BIS-CRS certification in an efficient manner. Our professionals have more than 20 years of compliance expertise and a thorough grasp of Indian regulatory norms. Here's how we can make the BIS-CRS certification procedure simple and efficient for your company.

Comprehensive Product Testing Support: We assist in coordinating product testing with BIS-approved laboratories and provide expert advice on meeting specific standards for electronics and IT goods.

Detailed Documentation Assistance: Our staff manages the whole paperwork process, ensuring that every form and detail satisfies BIS criteria for a flawless application submission.

Application Management: Fusion Compliance Services manages the entire application process, including submission, follow-ups, and addressing any queries from BIS authorities.

Post-Certification Compliance: We offer ongoing support to help businesses maintain compliance after certification, handling renewals, re-certifications, and any updates required by BIS standards.

Why Choose Fusion Compliance Services?

Experienced Team: Our staff consists of highly experienced engineers with expertise in BIS-CRS compliance, guaranteeing correct assistance throughout the certification process.

Client-Focused Approach: We prioritize customer satisfaction, offering tailored services that address your business needs efficiently.

Affordable and Reliable Services: Fusion Compliance Services believes in offering cost-effective, high-quality solutions that make compliance accessible to everyone.

Contact Fusion Compliance Services for BIS-CRS Certification

For businesses looking to enter the Indian market with BIS-CRS certification, Fusion Compliance Services is here to help. Let our experience, expertise, and commitment to quality guide your company through the certification process with ease.

Contact Information:

Office Address: Office no. S1 520, Cloud-9, Vaishali Sector 1, Near Mahagun Metro Mall, Ghaziabad, Uttar Pradesh-201012

Phone: +91-9696966665

Email: varun.yadav@fusioncomplianceservices.com

Partner with Fusion Compliance Services for a hassle-free BIS-CRS certification experience and ensure your products meet the highest standards of safety and quality.

[regulatorysolutionsindia]

In this video, we break down the essential aspects of Legal Metrology Compliance for medical devices in India. Learn about the regulations, standards, and requirements that manufacturers, importers, and distributors must follow to ensure compliance with the Legal Metrology Act. We also explore key insights into labeling, packaging, and other critical areas for medical device businesses. Stay updated and compliant to avoid legal complications and ensure smooth operations.

🔹 Key topics covered:

Overview of Legal Metrology Act

Compliance requirements for medical devices

Labeling and packaging standards

Key challenges and how to navigate them

Subscribe for more updates on regulations and compliance in the medical device industry!

[iirisconsulting]

Celebrating 8 Years of Excellence and Innovation - IIRIS Consulting

Celebrating 8 Years of Excellence and Innovation - with infinite dreams in our eyes 📷📷

Today marks a very special milestone for us, as we're proudly celebrating our 8th anniversary! 📷📷 It's been an incredible journey filled with growth, achievements, and unforgettable moments. We couldn't have reached this point without the unwavering support of our amazing team with exceptional deliverables, and valued clients. Thank you for being a part of our success story! 📷📷

📷 As we reflect on the past 8 years, we're filled with immense pride and gratitude for the milestones we've achieved. It's the dedication of our team and the trust of our clients that have propelled us forward and made our journey so rewarding. We are truly honoured to have been a part of your lives and businesses. 📷📷

📷 Today, we recommit ourselves to the values that have guided us from the beginning – innovation, integrity, and excellence. We look forward to the future with optimism and great excitement, as we continue to evolve, grow, and make a positive impact in the lives of our clients and the business we serve. 📷📷

📷 Join us in celebrating this momentous occasion! 📷 Share your favourite memories, achievements, or experiences with us using #iirismilestone #iiris #iirisconsulting #infinitedreams

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[vjmglobal]

Process of RBI approval to open Liaison Office (LO)| Branch office (BO)| Project office (PO) in India

With Globalization, India has become a preferable choice among all MultiNational Companies to set up their business units in India as India is a very fastest growing economy and having labour and various other resources at very reasonable rates.

Foreign companies should consider state regulations, physical connectivity, and local costs when choosing a location for their Indian office. The right establishment presence can mean the difference between success and wasted efforts.

Various foreign entities are opting for various methods to set up their entities in India such as set-up a subsidiary in India with Foreign Company as holding, Project Office, Liaison Office, Branch Office, Direct Investment in Indian Companies etc.

The government is making all the efforts to make India as one of the best places for doing business. Keeping National Security and Domestic development in mind, the Central Government, in consultation with Reserve Bank of India, has prescribed various pre-requisite approvals for foreign entities before setting up any entity in India.

In this article, the process of setting up a Liaison Office (LO)/ Branch Office (BO)/ Project Office (PO) is discussed in detail.

1. Applicable Legislature to setup Business in India

Regulations relating to the process of setting up offices of foreign entities in India is given in:

Section 6(6) of Foreign Exchange Management Act (“FEMA”).

Detailed provisions related to various restrictions, conditions and compliances for setting up LO/BO/PO is given in Foreign Exchange Management (Establishment in India of Branch Office or Liaison Office or Project Office or any other place of business) Regulations, 2016 (“LO/BO/PO Regulation”)

Master Directions No. 10/1025-16 dated 1st Jan, 2016 on “Establishment of Branch Office (BO)/ Liaison Office (LO)/ Project Office (PO) or any other place of business in India by foreign entity”

2. Meaning of Branch Office/Project Office/Liaison Office

2.1 Liaison Office

A Liaison Office (LO) functions as a representative office of the head office in Indian market. A Liaison Office (also referred to as Representative Office) can undertake only liaison activities i.e. act as a channel of communication between the head office and Parties in India. Liaison offices do not enter into any commercial or trading activity independently. Therefore, The role of such offices is Limited to collecting information about possible market opportunities, Source of supply, providing information about the parent company and its products to the prospective Indian customers or the other way around to its vendor. Expenses incurred for such offices are to be met entirely through inward remittances received from head office through normal banking channels.

2.2 Branch Office

Branch office can carry the same activities which are done by its holding Company/Head office.  

2.3 Project Office

Project Office means a place of business established in India to represent the interests of the foreign company/Head office in executing a project in India but excludes a Liaison Office.

2.4 Site Office

Site office means a sub-office established of a project office at the site of project. E.g, A project is being undertaken in Sonipat, Haryana. Project office related to such a project is set-up in Delhi, India. However, a site office is established for such project at Sonipat itself. Site office does not include Laision office.

3. Activities permitted for LO/BO/PO

As per directions given in Master Circular No. 10/2015 and Schedule I and II of LO/BO/PO regulations, following set of activities are permitted for different offices:

3.1 Activities permitted for Branch Office in India

Branch office carries out the same activity or part of the activities carried out by the head office. Therefore, branch offices are permitted to undertake more activities as compared to other offices. Following are activities permitted:

Export/Import of Goods

Providing professional service or consultancy service

Carry out research work in the area in which the head office is engaged.

Promoting technical or financial collaboration between Indian Company and Head Office/Parent company or various other sister concerns.

Representing the foreign company in India and acting as their commission/sales agent.

Rendering services in Information Technology and development of software in India.

Rending technical support to the product supplies by parent company/head office.

Representing a foreign airlines/shipping company.

3.2  Activities permitted for Liaison Office in India

Liaison office act as a channel of communication between head office and entities established in India. Therefore, it don’t enter into any commercial activity independently. Below are the activities permitted to liaison office in India

Representing the parent company / group companies in India.

Promoting export / import from / to India.

Promoting technical/ financial collaborations between parent / group companies and companies in India.

Acting as a communication channel between the parent company and Indian companies

3.3 Activities permitted for Project Office in India

No specific list of permitted activities are given for the project office. However, while granting approval letter for setting up the project office, designated Bank specifies a list of activities permitted for the project office.

3.4 Additional Activity

If LO/BO/PO wishes to carry out any additional activity then approval to carry out such activity is required from Reserve Bank of India. Requests for undertaking activity can be submitted by the applicant to the Reserve Bank of India through the designated Bank.

4. Requirements for opening a LO/BO/PO in India

For the purpose of setting up a LO/BO/PO in India, following are the prerequisites:

Prior approval of AD Category-1 Bank/ Reserve Bank of India; and

Application should be financially sound.

4.1 Prior approval of AD Category-1 Bank/Reserve Bank of India for setting LO/BO/PO

Application for approval of setting up a LO/BO/PO from a foreign company shall be filed with AD Category-1 Bank in accordance with guidelines issued by RBI.

In some cases, AD Category-1 Bank can approve the application itself, if it is permitted as per guidelines issued by RBI. However, in other cases, prior approval of the Reserve Bank of India is required. For such cases, AD Category-1 Bank shall forward the application to RBI.

In following cases, prior approval of RBI is not required:

Banking company, if necessary approval under the provisions of the Banking Regulation Act, 1949 has been obtained.

An insurance company,  if necessary approval under the provisions of the Insurance Regulatory and Development Authority Act, 1999 has been obtained.

A company resident outside India willing to establish a branch office in the Special Economic Zones (SEZs) where 100% FDI is permitted.

In following cases, RBI shall grant the approval only after consultation with Government of India:

Application is filed by the foreign entity registered in Pakistan;

Application is filed by the foreign entity registered in Bangladesh, Sri Lanka, Afghanistan, Iran, China, Hong Kong or Macau and entity wishes to establish LO/BO/PO in Jammu & Kashmir, North East Regions and Andaman & Nicobar

Principal business of the applicant falls in the four sectors namely Defence, Telecom, Private security and Information and Broadcasting.

The application is filed by a Non-Government Organisation (NGO, Non-Profit Organisation (NPO) or Bodyagency/department of a foreign government.

4.2 Financially sound application

If application is filed for setting a LO/BO, then application should be financially sound.

In following case, application is considered as financially sound:

* Meaning of Net Worth

Total of paid-up capital and free reserves, less intangible assets as per the latest Audited Balance Sheet or Account Statement certified by a Certified Public Accountant or any Registered Accounts Practitioner.

However, if LO/BO is not financially sound and it is a subsidiary company of any other company then a letter of comfort (LOC) may be issued by such holding company. Provided that such holding company must fulfil the criteria specified above

5. Procedure for setting up Liaison Office/ Branch Office

5.1 Approval by AD Category-1 Bank or RBI

Any foreign company intending to establish a Liaison Office/ Branch office in India is required to file an application with AD Category-I Bank in form FNC alongwith prescribed documents. This application is required to be supported by:

English version of the Certificate of Incorporation / Registration or MOA & AOA attested by Indian Embassy / Notary Public in the Country of Registration.

Latest Audited Balance Sheet of the applicant entity.

Other documents as prescribed

After proper scrutiny, AD bank shall forward the application together with their comments/ recommendations to the RBI for its approval. The applications will be considered by the RBI under two routes:

Automatic route – Where principal business of the foreign entity falls under sectors where 100 percent FDI is permissible under the automatic route.

Approval 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 are considered by the RBI in consultation with the Ministry of Finance, Government of India.

5.2 General Permission for setting up Liaison Office, Branch office and Project office

A general permission is given to foreign companies to establish their project office in India where the contracts have been secured from an Indian Company to execute a project. However, projects must have obtained necessary legal approvals and entire funds for execution of projects are received:

Inward remittance from abroad; or

Bilateral or multilateral International Financing Agency; or

Term loan fr/om a public Financial Institution or Bank of India.

Further, general permission is granted to non-residents for establishing Branch office in India where Branch office is established for Special Economic Zones (SEZ) to undertake manufacturing and service activities subject to following conditions:

BOs is functioning in sectors where 100% FDI is permitted;

BOs complies with Chapter XXII of the Companies Act, 2013; and

Branch office is functioning on a standalone basis.

5.3 Allotment of Unique Identification Number

Before issuance of approval letter, AD Bank shall forward the application in form FNC alongwith supporting documents to RBI for the purpose of allotment of Unique Identification number.

Post receipt of UIN from RBI, AD Bank shall issue the approval letter for setting up LO/BO in India.

5.4 Validity period of letter of approval for LO/BO/PO

Generally, the Validity period of approval of a Liaison office is 3 years.

However, in case of NBFC and entities engaged in construction and development sectors, the validity period is 2 years.

Validity period of the project office is the tenure of the project.

5.5 Extension of time period of validity of LO/BO/PO

In case of Liaison Office, request for extension of time period of Liaison office can be filed before expiry of validity of approval. Application of extension of validity period shall be filed with AD Category-1 Bank. AD Category-1 Bank can extend the validity period by further 3 years from date of expiry of approval provided that following conditions are duly met and application is filed in proper order:

LO has submitted Annual Activity certificate for previous years; and

Bank account maintained by LO in AD Category-1 Bank is being operated in accordance with terms and conditions provided in approval letter.

Application related to extension of validity period has to be dealt with in one month from date of receipt of the request.

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[fusion-compliance-services]

BIS CERTIFICATION IS MANDATORY FOR All-Electric Product

[iirisconsulting]

Know more about our leadership — Brig Neelesh Bhanot

Brig Bhanot is an accomplished intelligence expert with ability to navigate complex situations with his strategic agility and operational precision. As he takes over this new role we wish him the best and are confident that IIRIS will gain newer heights under his leadership.

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[iirisconsulting]

REID TECHNIQUE APRIL, 2020, MUMBAI

The Reid Technique of Interviewing and Interrogation® For Loss Prevention and Corporate Security Personnel is a four-day workshop specifically designed for corporate security, loss prevention, asset protection professionals, auditors and human resources personnel.

Every year, thousands of individuals from business, law enforcement, and government organizations utilize the services of John E. Reid and Associates for law enforcement training programs, and their products to help them:

Develop interviewing & interrogation skills

Conduct investigations

Select new employees

During the first three days, participants will learn The Reid Technique of Interviewing and Interrogation, widely recognized as the most effective means available to exonerate the innocent and identify the guilty. The workshop is based on the basic tenet of the Reid Technique, as taught by John E. Reid and Associates, that a custodial suspect must be advised of his rights prior to any questioning about a criminal act. The third day is designed to build on the information learned and particular emphasis is placed on how to elicit information from the suspect during the interview stage that will serve as the basis for developing an individualized interrogational approach, based on the suspect’s profile and characteristics.

Without exception, past participants have commented on the value of the advanced techniques learned which give them a better understanding of the interrogation process, and allow them to enhance their skill level by learning new techniques and tactics. Information is the most valuable resource for any professional that has to solve problems, make decisions and identify and select talent. Getting to that information is not an easy task especially when you have to extract it from the minds of others.

The Reid methodology is a tried and tested method that enables professionals to extract that type of high value information effortlessly. The techniques on which it is based stem from the field of law enforcement and security but have also been effectively applied to areas such as human resources especially when recruiting for positions of trust for businesses, law enforcement and government agencies and also when conducting disciplinary or audit processes.

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[iirisconsulting]

Quad-ASEAN Defence Exchanges On The Rise

The Malabar Quad exercise will take place in September of this year. For the second consecutive year all four Quad countries will participate.

An Indian task force of 4 ships from the Eastern Naval Fleet are already on a two-month voyage through the South China Sea (SCS) and Western Pacific where the Malabar will take place. The group comprises guided-missile destroyer Ranvijay, guided-missile frigate Shivalik, anti-submarine corvette Kadmatt and guided-missile corvette Korea.

Besides Malabar, they will carry out bilateral exercises with the navies of Vietnam, the Philippines, Singapore (SIMBEX), Indonesia (Samudra Shakti) and Australia (AUS-INDEX). They visited Brunei before proceeding to Guam for the Malabar21.

All the Quad countries have recently (2-6 August) participated in the EAS, ASEAN+1 Ministerial meetings as well as the meeting of the ASEAN Regional Forum (ARF), the main forum for regional security architecture.

The Quad recognise that in the Indo-Pacific, particularly in the SCS, it cannot afford to be facing a hostile China and neutral ASEAN member states. Their buffer has to be more responsive than hitherto. The revitalization of US policy towards the ASEAN could be seen in this context.

The SCS and the Indo-Pacific is seeing an increasing level of activity from the Quad. They are engaging the ASEAN member states more. This has to take into account that China is certain of its control over the SCS and is focusing on Taiwan. China regularly breaches Taiwan’s ADIZ and has deployed both its aircraft carriers with full battle groups around Taiwan. The Chinese are using their occupied island territories in SCS with increased capacity of missiles and now aircrafts. At present, China has the capacity to deploy as many aircrafts as on an aircraft carrier on these Island bases at one time.

Therefore, the US and its partners realise that a single carrier battle group (CBG) would be inadequate to deal with the Chinese strength based off these Islands. At least two CBGs would be required in the Indo-Pacific. The USS Reagan led CBG, from Yokosuka, was deployed to help in the evacuation from Afghanistan and could return soon. It supported the 5th Fleet’s USS Dwight D Eisenhower and its CBG , which have been in the area since April 2021. The CBG led by USS Theodore Roosevelt has also returned to the SCS. If the Indo-Pacific Command is to be more effective it needs to constantly deploy 2 CBGs. The visit of the UK CBG may be partly seen in this context.

Another notable point is that the US scrambled out of Afghanistan and may reduce its involvement in West Asia. The exit from Afghanistan could allow more leeway for releasing periodic CBG deployment under CENTCOM to the SCS and Indo-Pacific.

The US is aware that ASEAN as a whole has been slow in re-engaging them for a joint exercise. The first ASEAN-US maritime exercise was held at the Sattahip naval base in Thailand in September 2019. It passed through Singapore and concluded in Brunei. About 1000 people representing all 10 ASEAN member states and the US promoted a shared commitment to maritime security and stability in Southeast Asia. This included all ASEAN countries including Chinese allies like Cambodia and Laos. Though this was the result of a proposal at the ADMM-US meeting in 2017 and 2018, it has not recurred because of sensitivities towards China and lack of unanimity among ASEAN members. A China-ASEAN exercise of 2018 has also not recurred.

The three ASEAN countries which US Defense Secretary Austin visited recently, undoubtedly have strategic importance. Singapore, for example, is a key port for the US 7th Fleet, playing a significant role in providing logistic support for military aircraft and ships. Vietnam and the Philippines directly confront China over their respective territorial issues in the South China Sea.

Through such efforts, the US has enhanced its engagement with individual ASEAN countries. In April 2021, the Philippines and the US conducted the 36th Balikatan exercise held since 1991. It now has an Indo-Pacific dimension. It was held despite the pandemic with reduced participation, tabletop exchanges, training, real time security training, and similar activities.

A significant result of Secretary Austin’s visit to Philippines was the decision to hold off on the abrogation of the Visiting Forces Agreement, the basis of the US Philippines arrangement for military bases 

The US-Indonesia Garuda Shield exercise is another annual exercise for more than a decade. Held in August, it covered the large outlying islands of Indonesia, including Kalimantan, Sulawesi and Sumatra. Over a fortnight it involved amphibious, special forces and airborne units. In June 2021, Indonesian and US Marines conducted joint exercises focusing on conflicts in urban locations and are scheduled to do another exercise in the US later this year. US and Indonesia are constructing a joint maritime Training Centre in Batam, a small city on an island near the Malacca straits and close to Singapore. The US tries to solidify the US-Indonesia Major Défense Partnership and cooperation in support of a free and open Indo-Pacific (FOIP) region.

Thailand manifests the American dilemma in dealing with ASEAN. For several decades, Thailand and the US had a mutuality of interests as Thailand saw the US as a support against Chinese and Vietnamese influence in the region. Thailand, now having abandoned its democratic credentials, its military regime is more inclined towards engaging China and sees it as an uncritical partner. Due to their domestic issues and accommodation with China, Thailand does not have a strategic interest with the US; its main challenge is democracy, not China. The US has reduced financing for Thailand’s arms purchases following the coup in 2014.

This dilemma over democratic rights, economic assistance and proximity makes the US rethink its ASEAN engagement. Thus, traditional allies like Thailand and Philippines become ambivalent whereas old enemy Vietnam is a strategic partner.

During July 2021, Australia and Japan with eight other countries held joint exercises around Australia. This was preceded by the Australia-US, Talisman Sabre exercise. It was later joined by Japan, UK, Canada, South Korea and New Zealand. India, Indonesia, Germany and France sent observers. This combined exercise would further strengthen the FOIP.

The traditional ASEAN policy of outsourcing its security requirements mainly to the US was challenged when China became more aggressive and the US pivot to Asia did not happen under the Obama administration. During the Trump period, ASEAN was not a priority for the US. Under the Biden administration, the Indo Pacific and the Quad have a much higher priority.

Thus, the three-pronged policy recognises that China is the main factor and ASEAN has accommodated it, particularly in the economic sphere. The US wants to reengage with ASEAN and select member states. For this it prefers the regional architecture, to provide space, and a buffer between China and its rivals.

Increasingly the ASEAN buffer was inclining towards China. Now, efforts are made to restore the balance within that space particularly on the security and functional side. Undoubtedly for this to happen ASEAN member states also have to play a role.

ASEAN unanimity is now passe. When Cambodia takes over the chair for 2022 it is likely to play its pro-China role that it did in 2012. Hence, engaging ASEAN, praising its centrality and not giving up on it, is part of the policy.

A third prong of the policy of the US and other Quad members is clearly to engage with willing ASEAN member states who have greater strategic value. In this, Singapore, Indonesia, Vietnam, and Philippines are the main partners. Thailand, Malaysia, as well as Myanmar, due to their internal situations are not forthcoming. Such ‘ASEAN Plus’ policies from individual member states are small steps.

In my view this effort to deal with specific member states have increased their security and functional support for instance in fighting the pandemic. This could be viewed more vigorously by the US and its Quad partners. With this objective in mind, the significance of defence engagement of the US, the EU countries and the UK, with ASEAN countries certainly have greater significance as well.

Author

Written by Mr. Gurjit Singh

Ambassador Gurjit Singh is an advisory leader at IIRIS Pvt. Ltd.

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[vjmglobal]

Process of RBI approval to open Liaison Office (LO)| Branch office (BO)| Project office (PO) in India

With Globalization, India has become a preferable choice among all MultiNational Companies to set up their business units in India as India is a very fastest growing economy and having labour and various other resources at very reasonable rates.

Foreign companies should consider state regulations, physical connectivity, and local costs when choosing a location for their Indian office. The right establishment presence can mean the difference between success and wasted efforts.

Various foreign entities are opting for various methods to set up their entities in India such as set-up a subsidiary in India with Foreign Company as holding, Project Office, Liaison Office, Branch Office, Direct Investment in Indian Companies etc.

The government is making all the efforts to make India as one of the best places for doing business. Keeping National Security and Domestic development in mind, the Central Government, in consultation with Reserve Bank of India, has prescribed various pre-requisite approvals for foreign entities before setting up any entity in India.

In this article, the process of setting up a Liaison Office (LO)/ Branch Office (BO)/ Project Office (PO) is discussed in detail.

1. Applicable Legislature to setup Business in India

Regulations relating to the process of setting up offices of foreign entities in India is given in:

Section 6(6) of Foreign Exchange Management Act (“FEMA”).

Detailed provisions related to various restrictions, conditions and compliances for setting up LO/BO/PO is given in Foreign Exchange Management (Establishment in India of Branch Office or Liaison Office or Project Office or any other place of business) Regulations, 2016 (“LO/BO/PO Regulation”)

Master Directions No. 10/1025-16 dated 1st Jan, 2016 on “Establishment of Branch Office (BO)/ Liaison Office (LO)/ Project Office (PO) or any other place of business in India by foreign entity”

2. Meaning of Branch Office/Project Office/Liaison Office

2.1 Liaison Office

A Liaison Office (LO) functions as a representative office of the head office in Indian market. A Liaison Office (also referred to as Representative Office) can undertake only liaison activities i.e. act as a channel of communication between the head office and Parties in India. Liaison offices do not enter into any commercial or trading activity independently. Therefore, The role of such offices is Limited to collecting information about possible market opportunities, Source of supply, providing information about the parent company and its products to the prospective Indian customers or the other way around to its vendor. Expenses incurred for such offices are to be met entirely through inward remittances received from head office through normal banking channels.

2.2 Branch Office

Branch office can carry the same activities which are done by its holding Company/Head office.  

2.3 Project Office

Project Office means a place of business established in India to represent the interests of the foreign company/Head office in executing a project in India but excludes a Liaison Office.

2.4 Site Office

Site office means a sub-office established of a project office at the site of project. E.g, A project is being undertaken in Sonipat, Haryana. Project office related to such a project is set-up in Delhi, India. However, a site office is established for such project at Sonipat itself. Site office does not include Laision office.

3. Activities permitted for LO/BO/PO

As per directions given in Master Circular No. 10/2015 and Schedule I and II of LO/BO/PO regulations, following set of activities are permitted for different offices:

3.1 Activities permitted for Branch Office in India

Branch office carries out the same activity or part of the activities carried out by the head office. Therefore, branch offices are permitted to undertake more activities as compared to other offices. Following are activities permitted:

Export/Import of Goods

Providing professional service or consultancy service

Carry out research work in the area in which the head office is engaged.

Promoting technical or financial collaboration between Indian Company and Head Office/Parent company or various other sister concerns.

Representing the foreign company in India and acting as their commission/sales agent.

Rendering services in Information Technology and development of software in India.

Rending technical support to the product supplies by parent company/head office.

Representing a foreign airlines/shipping company.

3.2  Activities permitted for Liaison Office in India

Liaison office act as a channel of communication between head office and entities established in India. Therefore, it don’t enter into any commercial activity independently. Below are the activities permitted to liaison office in India

Representing the parent company / group companies in India.

Promoting export / import from / to India.

Promoting technical/ financial collaborations between parent / group companies and companies in India.

Acting as a communication channel between the parent company and Indian companies

3.3 Activities permitted for Project Office in India

No specific list of permitted activities are given for the project office. However, while granting approval letter for setting up the project office, designated Bank specifies a list of activities permitted for the project office.

3.4 Additional Activity

If LO/BO/PO wishes to carry out any additional activity then approval to carry out such activity is required from Reserve Bank of India. Requests for undertaking activity can be submitted by the applicant to the Reserve Bank of India through the designated Bank.

4. Requirements for opening a LO/BO/PO in India

For the purpose of setting up a LO/BO/PO in India, following are the prerequisites:

Prior approval of AD Category-1 Bank/ Reserve Bank of India; and

Application should be financially sound.

4.1 Prior approval of AD Category-1 Bank/Reserve Bank of India for setting LO/BO/PO

Application for approval of setting up a LO/BO/PO from a foreign company shall be filed with AD Category-1 Bank in accordance with guidelines issued by RBI.

In some cases, AD Category-1 Bank can approve the application itself, if it is permitted as per guidelines issued by RBI. However, in other cases, prior approval of the Reserve Bank of India is required. For such cases, AD Category-1 Bank shall forward the application to RBI.

In following cases, prior approval of RBI is not required:

Banking company, if necessary approval under the provisions of the Banking Regulation Act, 1949 has been obtained.

An insurance company,  if necessary approval under the provisions of the Insurance Regulatory and Development Authority Act, 1999 has been obtained.

A company resident outside India willing to establish a branch office in the Special Economic Zones (SEZs) where 100% FDI is permitted.

In following cases, RBI shall grant the approval only after consultation with Government of India:

Application is filed by the foreign entity registered in Pakistan;

Application is filed by the foreign entity registered in Bangladesh, Sri Lanka, Afghanistan, Iran, China, Hong Kong or Macau and entity wishes to establish LO/BO/PO in Jammu & Kashmir, North East Regions and Andaman & Nicobar

Principal business of the applicant falls in the four sectors namely Defence, Telecom, Private security and Information and Broadcasting.

The application is filed by a Non-Government Organisation (NGO, Non-Profit Organisation (NPO) or Bodyagency/department of a foreign government.

4.2 Financially sound application

If application is filed for setting a LO/BO, then application should be financially sound.

In following case, application is considered as financially sound:

* Meaning of Net Worth

Total of paid-up capital and free reserves, less intangible assets as per the latest Audited Balance Sheet or Account Statement certified by a Certified Public Accountant or any Registered Accounts Practitioner.

However, if LO/BO is not financially sound and it is a subsidiary company of any other company then a letter of comfort (LOC) may be issued by such holding company. Provided that such holding company must fulfil the criteria specified above

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