Foreign companies sometimes incorporate an entity in India to execute a specific project. However, as soon as an entity gets incorporated, a series of legal compliances begin. Therefore, in order to facilitate such foreign companies to easily enter and exit India, the concept of a project office was introduced. What is a project office and how can a foreign company register a project office in India? Let’s find out!
Foreign companies seeking to establish a presence in India for specific projects can do so through Project Office Registration. A project office simply means a place of business for a foreign company in India executing a specific project. But it excludes the liaison office. The project office is an ideal choice for companies looking to expand in the Indian market. Usually, foreign companies engaged in installations or turnkey projects set up project offices in India.
It is important to get your project office registered with the Reserve Bank of India (RBI) and the Registrar of Companies (ROC). It represents the interest of the foreign company that is undertaking projects in India and therefore, the project offices can undertake commercial activities, unlike liaison offices. For project Office Registration in India you need the best business consulting firm to fulfil the following eligibility criteria:
If the above conditions are satisfied, then the RBI may provide general permission for the project office registration in India. However, in certain situations, certain additional conditions shall be satisfied for establishing the project office. This includes prior approval of RBI if:
However, if the foreign company has obtained Government approval or permission/license from the concerned regulator or ministry, then no separate approval from RBI shall be required. Further, in case of the opening of the project office for a proposal in the defence sector, particular reference or approval of the Government of India shall not be required if the said non-resident is awarded a contract or has entered into an agreement with the Ministry of Defence or Defence Public Sector Undertakings or Service Headquarters.
Further, the following companies shall not be required to obtain any approval under these regulations:
The company shall file Form FC-1 with the Registrar of Companies (ROC) along with the following documents within 30 days after the Project Office Registration in India:
In case any alteration is made or it occurs after delivering the documents to the registrar for registration. The foreign company shall file Form FC-2 with the registrar within 30 days of which the alteration being made.
If the person opening the project office is from Sri Lanka, Bangladesh, China, Iran, Afghanistan, Macau and Hong Kong, then he shall register with the concerned State Police Authorities. Further, the copy of the approval letter for persons from these countries shall be marked by the AD Category-I bank to the Internal Security Division-I of the Ministry of Home Affairs.
Further, an Annual Activity Certificate (AAC) shall also be obtained from a Chartered Accountant disclosing the project status and certifying that the accounts of the project office have been audited. Further, it shall also state that the activities undertaken in the project are in conformance with the specific or general permission given by the RBI. Such a certificate should be submitted to the Authorised Dealer Category-I bank.
Following documents shall be required while filing the application for Project Office Registration in India:
Following were the requirements for setting up a project office in India. Therefore, if you are a foreign company looking for Project Office Registration in India, then feel free to consult the ASC Group.
Read More Article - How to Set up a Branch Office in India
Your email address will not be published. Required fields are marked *