Branch Office Registration
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Introduction
Branch Office Registration
A foreign corporation establishes a BRANCH office in India to carry out BRANCH activities for its business. The foreign firm can only generate revenue from the Indian Branch office if the Reserve Bank of India allows it; it must cover all of the expenses of the Indian office using remittances from the Head office or revenue generated from the Reserve Bank of India-approved Indian operation.
In India, foreign corporations are permitted to open a branch office. However, unlike forming a corporation, establishing a branch office necessitates clearance from the Reserve Bank of India (RBI). The foreign company can only begin operations after receiving a branch licence from the RBI.
Branch Office Features in General
- The Indian branch office's name must be the same as the parent companies.
- Reserve Bank of India is the Governing body for the branch office License.
- If the head office does not have money from Indian operations, it covers all of the expenses of the Branch office.
- Expanding its customer base by expanding its operations to new locations.
Benefits
Benefits of Branch Office Registration
Permissible Activities
Branch Office can undertake all types of profit making activity to promote business of its parent company.
Bank Account
A Branch Office may approach any AD Category-I bank in India to open an account for its operations in India.
Remittance of Profit
Profits earned by the Branch Offices are freely remittable from India, subject to payment of applicable taxes on production of prescribed documents to the satisfaction of the AD Category-I bank
Closure of Branch Office
Requests for closure of Branch Office and for remittance of winding-up proceeds needs to be submitted to designated AD Category - I bank along with prescribed documents.
Expenses of Branch office
Branch office is a representative of the foreign parent company, therefore expenses of such office may be met by the Head Office through inward remittances received in Convertible Foreign Exchange.
Extension of fund and non-fund based facilities
AD Category I Bank may extend Fund/Non Fund facilities to Branch Office on the basis of Board approved policy.
Process
Process for Branch Office Registration
