Raj Raj Raj (Manager) 11 June 2012

Starting an indian subsidiary

Hi,

Can a UK based company hire permanent employees in India without setting up a subsidiary? They do not want to hire contractors or outsource to a 3rd party company.

They will setup a office for 8-10 people and pay employees directly from the UK. Is that allowed?

Thanks.

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3 Replies

Sanyam Malhotra (Advocate) 12 June 2012

what is the nature of the business?

Raj Raj Raj (Manager) 13 June 2012

Software company based out of UK.

A V Vishal (Advocate) 15 June 2012

Project Office

Foreign Companies planning to execute specific projects in India can set up temporary project/site offices in India. RBI has now granted general permission to foreign entities to establish Project Offices subject to specified conditions. Such offices cannot undertake or carry on any activity other than the activity relating and incidental to execution of the project. Project Offices may remit outside India the surplus of the project on its completion, general permission for which has been granted by the RBI.

Branch Office

Foreign companies engaged in manufacturing and trading activities abroad are allowed to set up Branch Offices in India for the following purposes:

Export/Import of goods
Rendering professional or consultancy services
Carrying out research work, in which the parent company is engaged.
Promoting technical or financial collaborations between Indian companies and parent or overseas group company.
Representing the parent company in India and acting as buying/selling agents in India.
Rendering services in Information Technology and development of software in India.
Rendering technical support to the products supplied by the parent/ group companies.
Foreign airline/shipping company.

A branch office is not allowed to carry out manufacturing activities on its own but is permitted to subcontract these to an Indian manufacturer. Branch Offices established with the approval of RBI, may remit outside India profit of the branch, net of applicable Indian taxes and subject to RBI guidelines Permission for setting up branch offices is granted by the Reserve Bank of India (RBI).