Foreign companies may set up business in India in any one of pursuing manners while retaining its status as a foreign company:
Liaison Offices – A foreign company can open a liaison office in India to handle its Indian operations, to promote its business interests, to spread awareness among the company’s products and to explore further opportunities. Liaison offices are not allowed to preserve any business or earn any income in Online LLP Registration Procedure India and every one of expenses are to be borne by remittances from abroad.
Project Offices – The project office is the ideal method for companies to establish a legitimate income opportunity presence in India, if the object is to possess a presence for minimal period of a period of time. It is essentially a branch office set up with the limited purpose for executing a specific upgrade. Foreign companies engaged in turnkey construction or installation normally put in a project office for their operations in India.
Branch Offices – Foreign companies involved in manufacturing and trading activities outside India may open branch offices for on the road of:
oRepresenting the parent company or other foreign companies a number of matters in India, like acting as buying and selling agents.
oConducting research, wherein the parent company is engaged, provided the outcomes of this research are made to be able to Indian companies
oUndertaking export and import trading games.
oPromoting technical and financial collaborations between Indian and foreign companies.
Trading companies – Foreign companies may invest in trading companies engaged primarily in exports. Such trading companies are treated at par with domestic trading companies in accordance with the trade policy.
The RBI accords automatic approval for foreign equity as much 51 per cent for setting up trading companies engaged primarily in exports. All other proposals, which do not meet the criteria for automatic approval, can be addressed to the Foreign Investment Promotion Board, i.e. “FIPB”.
Wholly owned subsidiaries – Foreign companies may set up a wholly owned subsidiary, which is an Indian Company with an independent legal status, distinct from the parent foreign company.
Under the current foreign investment policy, a wholly owned subsidiary can be established either the particular automatic route, generally if the conditions specified therein are complied with (specific high priority industries) or obtain an approval from the FIPB.
Joint venture companies – Foreign companies may set up a joint venture company i.e. in financial collaboration with an Indian business house/company in India, and an Indian Company with an independent legal status, distinct from the parent foreign company.
Under the current foreign investment policy, a joint venture can be established either under the automated route, if the conditions specified therein are complied with or obtain an approval from the FIPB.
Foreign companies intending to make any involving office already stated activities on behalf of the parent company or foreign trading companies in India for promotion of exports from India should obtain a prior approval of this Reserve Bank by submitting an application in the prescribed form to the Central Office of Reserve Bank. On approval of cases, permission is granted initially a period of three years, foreclosures the condition that expenses of such office will met exclusively out of inward remittances; such offices are not permitted create any income in India.