A Liaison Office (also known as Representative Office) can undertake only liaison activities, i.e. it can act as a channel of communication between Head Office abroad and parties in India. Liaison Offices are not allowed to undertake any business activity in India and cannot earn any income in India. Expenses of such offices are to be met entirely through inward remittances of foreign exchange by the Head Office of the Company. Permission to set up such offices is initially granted for a period of 3 years and this may be extended from time to time by the Reserve Bank of India.

The permitted activities of a liaison office in India are;

• Representing the parent company / group companies in India.
• Promoting export / import from / to India.
• Promoting technical/ financial collaborations between parent / group companies and companies in India.
• Acting as a communication channel between the parent company and Indian companies.