A Liaison Office implies a position of business to go about as a channel of communication between the chief business environment or Head Office or by whatever name called and entities in India however which doesn't embrace any business/exchanging/mechanical movement, straightforwardly or in a roundabout way, and keeps up itself out of internal settlements got from abroad through ordinary financial channel. Liaison offices (LOs) are a popular option for foreign investors exploring the Indian market for the first time, and unsure of how the country’s liberalizing FDI caps will affect their business.
Rather than different business structures, LOs permit foreign companies to build up a light impression in India while keeping their monetary, legitimate, and managerial responsibilities low. Foreign companies can open a contact office in India to encourage and advance the parent organization's business exercises, and go about as an interchanges channel between the foreign parent company and Indian organizations.
Nonetheless, the Reserve Bank of India (RBI) has coordinated the banks not to concede new authorizations/restoration of consent to any foreign law office for opening of contact office in India. The Apex Bank's notice emphasizes its kid remain after the Supreme Court had explained in 2015 that foreign law firm’s liaison offices are not permissible in India.
Approved Dealer Category - I Banks (AD Category–I Banks) and Authorized Dealers Category – II elements (ADs Category–II) are approved by the Reserve Bank to bargain in foreign exchange for indicated purposes. Such banks expect to facilitate the foreign exchange facilities for NRI.
According to the Foreign Exchange Management Act (FEMA), the Liaison Office implies a position of business to go about as a channel of correspondence between the administrative center by whatever name called and substances in India however which doesn't attempt any business/exchanging/modern action, straightforwardly or in a roundabout way, and keeps up itself out of internal settlements got from abroad through ordinary financial channel.