![]() ![]() Proprietary concerns which are established abroad are not allowed to start a project office in India.The PO remains valid for the entire tenure of the project (till the project is completed or wound up). Additionally, the AD Bank is required to mark a copy of the approval letter for “persons” from these countries to the Ministry of Home Affairs, Internal Security Division-I, GoI, New Delhi for their record or necessary action. Note: Regulation 2016 requires applicants from Bangladesh, Sri Lanka, Afghanistan, Iran, China, Hong Kong, Macau or Pakistan, who are desirous of opening BO/PO/LO in India, to register with relevant state police authorities. In case an approval granted by the AD bank has either been surrendered by the applicant or has expired without any PO being set up, the AD Category I bank shall inform RBI accordingly. The AD Category I bank in turn shall inform Reserve Bank accordingly. The AD Category-I banks may frame appropriate policy for dealing with these applications in conformity with the FEMA Regulations and Directions.Īn applicant that has received a permission for setting up of a PO shall inform the designated AD Category I bank as to the date on which the PO has been set up. The AD Category-I bank shall after exercising due diligence in respect of the applicant’s background, and satisfying itself as regards adherence to the eligibility criteria for establishing PO, antecedents of the promoter, nature and location of activity of the applicant, sources of funds, etc., and compliance with the extant KYC norms grant approval to the foreign entity for establishing PO in India. an AD Category – I bank identified by the applicant with whom they intend to pursue banking relations) along with the prescribed documents mentioned in the Form. The application for establishing PO in India may be submitted by the non-resident entity in Form FNC (Annex B) to a designated AD Category – I bank (i.e. It takes generally takes 15 days to register a PO.Further extension may be granted by RBI only.Extension for 6 months may be granted by AD Category-I bank for reasons beyond the control of the person resident outside India. ![]() The office shall be opened within 6 months from the date of approval letter.However, no separate reference or approval of the Government of India (GoI) will be required in respect of proposal for opening of a PO relating to the defence sector, if contract for which the PO is opened has been awarded by/entered into with the Ministry of Defence or Service Headquarters or Defence Public Sector Undertakings In all other cases, Authorized Dealer Category-I banks are empowered to grant approval.Ģ. Principal business falls in defence/telecom/private security/ information and broadcasting sector. However, if any entity resident in Pakistan, Bangladesh, Sri Lanka, Iran, Afghanistan, China, Macau and Hong-Kong desires to open project office in Jammu & Kashmir, North Eastern States and Andaman and Nicobar islands, approval is granted by RBI in consultation with Government of India. In this article, we would discuss various aspects and procedure for setting up project office in India as per revised guidelines.Ī foreign company may open project office/s in India provided it has secured from an Indian company, a contract to execute a project in India, andġ. RBI has given general permission for opening of Project Office in India if the above conditions are satisfied. Revised Regulations 2016 under FEMA has delegated all powers of approving applications to AD banks except few cases. ![]() ‘Project Office’ also represents the interests of the foreign company executing a project in India as in the case of Liaison Office with the only difference, that Project Office can undertake commercial activities related to the particular project whereas the liaison office cannot. Foreign companies engaged in turnkey construction or installation normally set up a project office for their operations in India.įoreign Companies who have been awarded a contract to execute a project in India, select the mode of execution of the project, through project offices duly registered with the Reserve Bank of India (RBI) and the Registrar of Companies (ROC). It is essentially a branch office set up with the limited purpose for executing a specific project. The project office is the ideal method for companies to establish a business presence in India, if the object is to have a presence for a limited period of time. ‘Project Office’ means a place of business to represent the interests of the foreign company executing a project in India but excludes a Liaison Office. ![]()
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