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Liason Office in India
About Liason Office in India
It is a setup by a foreign company in India to carry out the liaison activity for its business. The company cannot have any revenue for the Indian Liaison office; It has to meet all its expenses of Indian office through remittances from the Head office. The Liaison office is not allowed to earn any income in the India.
Some important factors
- The name of Indian liaison office shall be same as parent company.
- The governing body for the Liaison office License is Reserve Bank of India.
- License will approve through Authorise Dealer Category-I, in case where 100% FDI is permitted.
- The Liaison office does not have any ownership; it is just extension of the exiting company in the foreign country.
- The License for the Liaison office is given for three years and shall be renewed every 3 years.
- The company should have good track record in profit making in parent company
Activity can be initiated by LO
- Representing in India the parent company / group companies.
- 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.
BENEFITS BY REGISTERING LO
- Foreign entity get recognition in India
- Can proceed its liaison activity for its business in India
- Helping in test and understand the Indian market,
- Helping in carry out the Research & Development activities or to understand the problem of existing clients of the company and serve them better.