Liaison, Branch and Project Office of a Foreign Company — What Applies in 2026 (and What Is Still Only a Draft)
Quick answer: A foreign company opens a liaison, branch or project office in India under the FEMA (Establishment in India of a Branch Office or a Liaison Office or a Project Office) Regulations 2016 — still the operative law: RBI's draft replacement of 3 October 2025 had not been notified as of 4 October 2026, so the 2016 eligibility applies. Apply in Form FNC through an AD Category-I bank (RBI/Government approval where the applicant is from a land-border country or a sensitive sector): a liaison office needs a three-year profit record and USD 50,000 net worth, a branch office five years and USD 100,000, with a parent's letter of comfort where the applicant falls short. Then UIN, PAN, ROC registration (Form FC-1 within 30 days) and the Annual Activity Certificate by 30 September. We run the AD-bank file and the annual compliance.
Last verified 4 October 2026 — rules on this page checked against the current notifications. We update it the day a rule changes.
The three forms of presence
| Aspect | Liaison office | Branch office | Project office |
|---|---|---|---|
| Can it earn in India? | No — representation, sourcing, promotion only; expenses met by inward remittance | Yes — export/import, consultancy, services, R&D, agency; no manufacturing (except SEZ) or retail | Yes — for a specific contract awarded by an Indian entity |
| Eligibility (2016 regulations) | Profit in the 3 preceding years; net worth ≥ USD 50,000 | Profit in the 5 preceding years; net worth ≥ USD 100,000 | Contract funded from abroad / by a multilateral agency / cleared by an authority |
| Falls short? | Parent company's letter of comfort if the parent meets the test | — | |
| Validity | 3 years, extendable | Open-ended | Project duration |
| Approval | Form FNC to an AD Category-I bank; RBI/Government approval where the applicant is from a land-border country, is an NGO/NPO/government body, or the sector is defence, telecom, private security, information and broadcasting | ||
| Tax | No income, so no tax on operations; annual filings apply | Taxed as a foreign company | Taxed as a foreign company |
After approval
- UIN from RBI through the AD bank; PAN; ROC registration in Form FC-1 within 30 days of establishment (Companies Act s.380)
- Annual Activity Certificate from a CA, as at 31 March, to the AD bank by 30 September, with a copy to the income-tax authorities
- Police registration for applicants from the notified countries; Shop Act and local registrations at the office
What we do
- Choice of form (LO/BO/PO vs a subsidiary), FNC file with apostilled parent documents and audited accounts, AD-bank liaison and RBI/Government route where needed
- UIN, PAN, FC-1, GST, bank; Annual Activity Certificate and FC-3/FC-4 ROC filings; closure or conversion when the business grows into a subsidiary
Figures are quoted from the issuing authority's own notification or portal; anything not yet confirmed on an official page is marked and checked at filing, never estimated.
Foreign parent? Indian subsidiary — FC-GPR within 30 days, FLA by 15 July, and the Press Note 2 (2026) screen.
Talk to us before you file anything
Frequently asked questions
Are RBI's new branch/office regulations in force?
No — the 3 October 2025 draft had not been notified as of October 2026; the 2016 regulations (FEMA 22(R)) still govern eligibility and process.
What net worth does a liaison office need?
USD 50,000 with a three-year profit record; a branch office needs USD 100,000 and five years — or a parent's letter of comfort.
Can a liaison office earn revenue in India?
No — it only represents the parent, promotes and sources; all expenses come by inward remittance.
Who approves a branch office?
The AD Category-I bank on Form FNC; RBI or Government approval is needed for land-border-country applicants and sensitive sectors.
Is ROC registration required?
Yes — Form FC-1 within 30 days of establishing the place of business, then annual FC-3/FC-4 filings.
When is the Annual Activity Certificate due?
By 30 September each year, as at 31 March, certified by a chartered accountant.
How long is a liaison office approval valid?
Three years, extendable through the AD bank.
Liaison office or subsidiary?
If you intend to invoice customers in India, a subsidiary; an LO suits market study and representation only.