Chartered Accountant · ICAI M.No. 153926 · FRN 136869W
What it can and can't do
A liaison (representative) office is a limited India presence for a foreign company — it can represent the parent, promote, gather market information and facilitate communication, but it cannot trade, sign revenue contracts or earn income in India. All its expenses must be met by inward remittance from the parent abroad.
How it's set up
Setting up needs RBI approval — applied for through an Authorised Dealer (AD) bank under FEMA — with eligibility tests on the parent’s track record and net worth. After approval it registers with the ROC, obtains a PAN, and files annual activity certificates. RBI eligibility criteria are specific — confirm before applying.
Which entry route — an example
Example: a European manufacturer wanting to explore India sets up a liaison office to meet distributors and study the market — no sales, just presence. Once it wants to actually sell, it must upgrade to a branch office or, more commonly, a wholly-owned subsidiary company, which can trade and earn. Choosing the right entry vehicle upfront saves restructuring. Our team can advise on India-entry options.