Establishment of Liaison Office (LO) / Branch Office (BO) / Project Office (PO) in India by Foreign Entities - RBI Clarification
AS per "Foreign Exchange Management (Establishment in India of Branch or Office or other Place of Business) Regulations, 2000, a person resident outside India requires prior approval of the Reserve Bank for establishing LO / BO in India.
General permission is granted to a foreign company to open project office in India provided it has secured from an Indian company, a contract to execute a project in India, and subject to satisfying certain other criteria.
RBI clarifies that permission to establish offices, in India by foreign Non-Government Organisations/Non-Profit Organisations/Foreign Government Bodies/Departments, by whatever name called, are under the Government Route. Accordingly, such entities are required to apply to the Reserve Bank for prior permission to establish an office in India, whether Project Office or otherwise.
RBI A. P. (DIR Series) Circular No. 31., Dated: September 17, 2012