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Liaison Office of a Foreign Company in India

Reviewed by CA and CS Team, Patron Accounting LLP ICAI & ICSI Registered| 15+ Years Experience| Last Updated: Verify Credentials →

Structure: liaison or representative office; RBI-approved under FEMA. No income in India.

Fees: liaison office setup starting from INR 79,999 (Exl GST and Govt. Charges).

Eligibility: 3-year profit track record and net worth of USD 50,000 or more.

Validity: 3 years initial (2 for NBFCs and construction), renewable.

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Foreign Liaison Office in India: Overview

📌 TL;DR - Liaison Office Setup Services at a Glance

A liaison office lets a foreign company maintain a presence in India to explore the market and act as a communication channel, but it cannot earn income and is funded by the parent. It is set up via Form FNC through an AD bank, gets a UIN, is valid for 3 years, and registers with the ROC in Form FC-1. Patron Accounting does it all from INR 79,999.

Parameter	Detail
Structure	Liaison (representative) office of the foreign parent
Governing Law	FEMA (Establishment in India of a Branch or Office) Regulations, 2016
Approval	RBI via AD Category-I bank; Form FNC; UIN allotted
Income in India	Not allowed; funded by inward remittances from the parent
Eligibility	3-year profit track record; net worth USD 50,000+
Cost	Liaison office setup from INR 79,999 (Exl GST and Govt. Charges)
Validity	3 years initial (2 for NBFCs and construction), renewable

A liaison office is the lightest India presence, ideal for understanding the market before committing capital to a branch or subsidiary. Government fees and approval timelines vary by applicant profile and country and are billed at actuals; RBI's 2025 draft reforms are noted as proposed, not in force.

Content is reviewed quarterly for accuracy.

What Is a Liaison Office?

A liaison office, also called a representative office, is a place of business through which a foreign company maintains a presence in India purely to communicate and explore, without carrying on any commercial activity or earning income. It is governed by FEMA and registered with the Registrar of Companies.

It acts as a channel between the parent and Indian customers, suppliers and authorities, and all its costs must be met by inward remittances from the parent. Because it cannot trade or earn income, it is used for market study and relationship-building before a larger commitment.

Key Terms for Liaison Office Setup:

Liaison office: a non-revenue representative presence of the foreign parent.
Form FNC: the application to the AD bank and RBI to set up a liaison or branch office.
UIN: the Unique Identification Number the RBI allots to each liaison office.
AAC: the Annual Activity Certificate confirming the LO earned no income.

FEMA Office Form FNC | UIN

Who Should Open a Liaison Office?

A liaison office suits a foreign company that wants to study the Indian market, build relationships and represent the parent before investing in a revenue-earning entity. It is common for companies testing demand, scouting partners or coordinating with the parent's Indian customers.

If you need to earn income, trade or manufacture, a branch office or a wholly-owned subsidiary is the right route, since a liaison office cannot earn revenue. Many companies start with a liaison office and later convert to a JV or subsidiary as required by the FDI policy.

Our Liaison Office Services

Service	What We Do
Eligibility and route check	Track record, net worth and country-specific approval needs.
Form FNC application	Preparation and filing through an AD Category-I bank.
RBI UIN	Coordination with the AD bank and RBI for the Unique Identification Number.
FC-1 ROC registration	Filing Form FC-1 with the MCA within 30 days of approval.
Tax registrations	PAN, Form 49C and the annual income tax return.
Ongoing compliance	Annual Activity Certificate, FC-3 and FC-4, and renewals.

Our Process

Liaison Office Setup Process: 6 Steps

From the eligibility and country check to tax and compliance setup, here is how Patron Accounting establishes a foreign company's liaison office in India end to end.

Step 1

Check eligibility and country

Confirm the 3-year profit track record, USD 50,000 net worth, and whether prior RBI or government approval applies.

Track record checked Net worth confirmed

Eligibility Confirmed 01

Step 2

Designate an AD bank

Choose an AD Category-I bank to channel the application and manage FEMA compliance.

AD bank chosen FEMA channel set

AD Bank Designated 02

Step 3

File Form FNC

Submit the Form FNC application with the parent's charter, audited accounts and an undertaking to fund the LO.

Form FNC filed Undertaking given

Application Filed 03

Step 4

Obtain RBI approval and UIN

The AD bank does due diligence and obtains a Unique Identification Number from the RBI.

Due diligence done UIN allotted

UIN Obtained 04

Step 5

Register with the ROC

File Form FC-1 with the Registrar of Companies within 30 days of approval; open the LO within 6 months.

FC-1 filed ROC registered

Registered 05

Step 6

Set up tax and compliance

Obtain PAN, set up the AAC, Form 49C and ROC filings, and operate within the permitted scope.

PAN obtained Compliance set

Compliant 06

Documents Required for a Liaison Office

Certificate of incorporation and charter: of the foreign parent, apostilled or notarised.
Audited financial statements: of the parent for the last 3 years.
Net worth certificate: from the parent's auditor (USD 50,000 or more).
Board resolution and undertaking: to fund the LO through inward remittances.
KYC and address proof: of the parent and the proposed India office.

Common Challenges and How We Solve Them

Challenge	Impact	How Patron Accounting Solves It
Crossing into commercial activity (PE risk)	Revenue activity creates a permanent establishment	We define and monitor the permitted scope
Country-specific prior approval	Some countries need RBI or government clearance	We manage the RBI or government approval route
Net worth or track record shortfall	Eligibility thresholds may not be met	We review eligibility and alternative routes
Missing FC-1, AAC or Form 49C deadlines	Lapses create FEMA and ROC exposure	We manage the full annual compliance calendar

Liaison Office Setup Fees

Fee Component	Amount
Patron Accounting Professional Fees	Starting from INR 79,999 (Exl GST and Govt. Charges)
Government fees	Billed at actuals; vary by applicant profile and country
Apostille / notarisation and bank charges	At actuals, depending on the parent's jurisdiction
Ongoing compliance and renewals	Scoped separately (AAC, FC-3, FC-4, Form 49C)

All fees and charges listed are indicative only and do not constitute a binding offer. Final amounts may vary depending on the volume of work and the complexity involved.

Professional service charges for drafting, filing, and representation are separate from the statutory fees. The exact fee depends on the complexity of the case, disputed amount, and number of hearings required. Contact us for a detailed quote.

Get a free Liaison Office Setup consultation - Call +91 945 945 6700 or WhatsApp us. No-obligation assessment.

How Long Does Setup Take?

Stage	Estimated Timeline
Liaison office (overall)	About 6 to 8 weeks
AD bank due diligence and RBI review	The main driver of the timeline
Prior-approval countries or sectors	Take longer; FC-1 within 30 days of approval

Applications from Pakistan and certain other countries or sectors take longer because they require prior RBI or government approval. The FC-1 filing follows within 30 days of approval, and the office should be opened within 6 months.

Key Benefits

Why Set Up a Liaison Office with a Professional

Low-commitment India presence

Study the market and build relationships before investing in a revenue entity.

Parent-funded and simple

No revenue or trading obligations; funded by inward remittances.

Clean FEMA compliance

Timely FC-1, Annual Activity Certificate and Form 49C protect your status.

Trusted by Foreign Companies Entering India

10,000+ Businesses | 4.9 Google Rating | 50,000+ Documents Handled | 15+ Years Experience

Trusted by clients including Hyundai, Asian Paints and Bridgestone. With offices in Pune, Mumbai, Delhi and Gurugram, Patron Accounting serves foreign companies entering India both in-person and remotely.

Liaison Office vs Branch Office vs Subsidiary

Factor	Liaison Office	Branch Office	Wholly-Owned Subsidiary
Income in India	Not allowed	Yes, permitted activities	Yes, full
Purpose	Market study, liaison	Trading, services, research	Full operations
Manufacturing	No	Not directly	Allowed
Eligibility	3 yr profit, USD 50k	5 yr profit, USD 100k	No track record needed
Validity	3 years, renewable	Generally ongoing	Perpetual

Related Services

Ready to earn income or trade? A branch office of a foreign company in India suits RBI-permitted revenue activities, and a wholly-owned subsidiary suits full, permanent operations; we advise on both as the next step from a liaison office. Pair any India entry with our FDI compliance service or a private limited company registration. We also advise on overseas company registration, including Singapore, for outbound expansion.

Legal and Compliance Framework

FEMA (Establishment in India of a Branch or Office) Regulations, 2016: a liaison office is set up with RBI permission through an AD Category-I bank via Form FNC, with a UIN allotted; it may act only as a communication channel and cannot earn income in India (overseen by the RBI).

Eligibility and validity: the parent must have a profit-making track record in the preceding 3 financial years and net worth of at least USD 50,000; approval is generally valid for 3 years (2 years for NBFCs and construction or development entities) and is renewable.

Companies Act, 2013: the LO registers with the Registrar of Companies in Form FC-1 within 30 days of RBI approval and files FC-3 and FC-4 annually; changes to filed documents are reported in Form FC-2 (via the MCA).

Tax and AAC: the LO obtains a PAN, files Form 49C within 8 months of the financial year-end and an income tax return, and submits an Annual Activity Certificate from a Chartered Accountant confirming it earned no income; exceeding the permitted scope can create a permanent establishment and tax liability (per the Income Tax Department).

What is a liaison office of a foreign company in India?

A liaison office, also called a representative office, is a place of business through which a foreign company maintains a presence in India purely to communicate, represent the parent and explore the market. It cannot carry on commercial activity or earn income in India, and all its expenses are funded by inward remittances from the parent. It is set up with RBI approval and registered with the Registrar of Companies.

Can a liaison office earn income in India?

No. A liaison office is strictly prohibited from earning any income in India or carrying on commercial, trading or industrial activity. Its role is limited to acting as a communication channel between the foreign parent and Indian parties, and it must be funded entirely by inward remittances from the parent. If it crosses into revenue-earning activity, it risks being treated as a permanent establishment with tax consequences.

How does a foreign company set up a liaison office?

A foreign company sets up a liaison office by applying to the RBI through a designated AD Category-I bank in Form FNC, with its charter, three years of audited accounts, a net worth certificate and an undertaking to fund the office. The AD bank does KYC and obtains a Unique Identification Number from the RBI. Within 30 days of approval, the company registers the office with the Registrar of Companies by filing Form FC-1.

What is the validity of a liaison office in India?

A liaison office is generally approved for an initial period of three years, except for NBFCs and entities in the construction and development sectors, where the validity is two years. The approval can be renewed by the AD Category-I bank with the RBI's approval for further periods, subject to satisfactory compliance and a continued need for the office. If the office is not opened within six months of approval, the approval lapses.

What is the eligibility to open a liaison office?

To open a liaison office, the foreign parent must have a profit-making track record in the immediately preceding three financial years in its home country and a net worth of at least USD 50,000 or its equivalent, certified by its auditor. Applicants from Pakistan and certain other countries, including Bangladesh, Sri Lanka, Afghanistan, Iran, China, Hong Kong and Macau, and certain sectors, need prior RBI or government approval.

What activities can a liaison office do in India?

A liaison office can only represent the foreign parent in India, act as a communication channel between the parent and Indian companies, promote export and import between India and the parent's country, and promote technical or financial collaborations. It cannot sign contracts in its own name, earn income, trade, or carry on any commercial activity. Staying within this scope is essential to avoid permanent establishment exposure.

What is the difference between a liaison office and a branch office?

A liaison office is a non-revenue representative presence that can only liaise and explore the market and is funded by the parent. A branch office can earn income from RBI-permitted activities such as trading, professional services and research, though it cannot manufacture directly. The eligibility is also higher for a branch, needing a five-year profit track record and USD 100,000 net worth, against three years and USD 50,000 for a liaison office.

India me liaison office kaise khole?

AD bank ke through Form FNC se RBI approval lo, UIN milta hai, phir 30 din me ROC ke paas FC-1 file karo - dhyaan rahe LO income nahi kama sakta. Patron Accounting sab sambhal leta hai.

Quick Answers

Can it earn income? No; market exploration and liaison only.
Approval by? RBI via an AD Category-I bank (Form FNC).
Validity? 3 years initial (2 for NBFCs and construction), renewable.
Eligibility? 3-year profit record and USD 50,000 net worth.

Exploring the Indian Market? Set Up Your Liaison Office

A liaison office is deceptively simple: the hard parts are staying within the no-income permitted scope to avoid a permanent establishment, and keeping up the FEMA filings. Professional handling protects the LO's status and your tax position.

Call +91 945 945 6700 or message us on WhatsApp for a free, no-obligation quote on your liaison office setup.

Start Your Liaison Office Today

A liaison office is the lightest, lowest-commitment way for a foreign company to establish a presence in India, ideal for market exploration and relationship-building before investing in a revenue-earning entity. It is an RBI-approval-driven route via Form FNC, valid for three years, and strictly non-revenue, so staying within the permitted scope is essential to avoid a permanent establishment.

When you are ready to trade or manufacture, it can convert to a branch or subsidiary. Patron Accounting, with 15+ years of experience and a CA and CS team, manages the approval, registration and ongoing FEMA compliance end to end.

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Foreign Company Setup and FEMA Compliance Across India

We set up liaison offices and handle FEMA compliance nationwide - in-person in these cities and remotely everywhere else.

FDI Compliance by City

FEMA support for foreign entities, handled locally

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Content Created: 3 June 2026 | Last Updated: | Next Review: 3 December 2026 | Reviewed By: CA & CS Team, Patron Accounting LLP

This page is reviewed every 6 months or whenever the RBI branch and office regulations, the FEMA establishment rules, or the Companies Act foreign-company provisions change, including the RBI 2025 draft once notified, so the liaison office guidance stays current.