List of Activities Permitted for a Liaison Office in India

Overview :A Liaison office functions as a representative office of a foreign company which is set up to have the initial understanding of the business & investment environment in India. Establishing a liaison office in India is generally permitted under automatic route of approval. These offices are permitted to do limited activities in India which you can see in this blog.

The establishment of a liaison office in India, is generally permitted under automatic route of approval, and the application is filed in form FNC to the authorised dealer category-1, appointed by the RBI. Mostly scheduled banks have been appointed, as authorised dealer banks for setting up of the liaison office in india.

The liaison office of a foreign corporation can do limited activities in India, and to be precise only four kinds of activities are permitted. Following is the list of activities, which have been allowed for a liaison office in India, as prescribed under regulation 4, subsection: b, of the notification number, FEMA 22, subsection: R, or 2016 r b, dated : march 31st, 2016.

Activities Permitted for a Liaison Office in India

To represent the parent or group companies in india.
To engage in activities, which are in the nature or promotion of import or export.
To promote technical financial collaborations between parent, or group companies or companies in ind className="mt-3"ia.
To act as a channel of communication between the parent company, and the Indian company.

Conclusion

To conclude, a liaison office of a foreign company can be set up in India but only for limited activities to explore the market potential. Setting up a Liaison office in India is permitted under automatic route. The aforementioned list of activities permitted for a liaison office set up in India can help foreign companies make informed decisions.