Foreign companies may set up business in India in any one of the following manners while retaining its status as being 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 belonging to the company’s products as well as to explore further chances. Liaison offices are not allowed to preserve any business or earn any income in India and every one of expenses are for you to become 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 have a presence for constrained period of a period of time. It is essentially a branch office launched with the limited purpose for executing a specific upgrade. Foreign companies engaged in turnkey construction or installation normally established a project office for their operations in India.
Branch Offices – Foreign companies engaged in manufacturing and trading activities outside India may open branch offices for extra of:
oRepresenting the parent company or other foreign companies in various matters in India, like acting as buying and selling agents.
oConducting research, the spot that the parent company is engaged, provided the results of this research are made there for Indian companies
oUndertaking export and import trading activities.
oPromoting technical and financial collaborations between Indian and foreign companies.
Trading companies – Foreign companies may invest in trading companies engaged primarily LLP Registration Online in India 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 around 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 a good Indian Company through having 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, if for example the conditions specified therein are complied with (specific high priority industries) or ask for approval from the FIPB.
Joint venture companies – Foreign companies may set up a joint venture company i.e. economical collaboration with an Indian business house/company in India, that is 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 automatic route, if the physical conditions specified therein are complied with or obtain an approval from the FIPB.
Foreign companies intending to make any regarding office already mentioned activities on the part the parent company or foreign trading companies in India for promotion of exports from India in order to be obtain an earlier approval for this Reserve Bank by submitting an application in the prescribed form to the Central Office of Reserve Bank. On approval of the cases, permission is granted initially for a period of three years, depending upon the condition that expenses of such office can met exclusively out of inward remittances; such offices are not permitted produce any income in India.