Apr 1, 2019

Dispensation of Approval

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Reserve Bank of India (‘RBI’) has recently issued a circular vide A.P. (DIR Series) Circular No. 27, dated 28th March, 2019 to do away the requirement of RBI/ government approval for opening of Branch Office (‘BO’) / Liaison Office (‘LO’) / Project Office (‘PO’) or any other place of business in India by overseas applicants engaged in specified sectors.

The circular provides as follows:

  1. Dispensation of RBI Approval:

    Opening of BO/LO/PO or any other place of business in India by an overseas applicant which is engaged in the business of defence, telecom, private security and information and broadcasting sector and which has been granted government approval or license/permission by the concerned Ministry/ Regulator, as the case may be, shall not entail RBI approval.

  2. Dispensation of Government Approval

    Opening a PO relating to defence sector by an overseas applicant which has been awarded a contract by/entered into an agreement with the Ministry of Defence or Service Headquarters or Defence Public Sector Undertakings, shall not require separate reference or approval of Government of India.

The afore-said relaxation to the overseas applicant engaged in the prescribed sectors has done away the requirement of twin approval for single transaction. This move shall impart the ease of doing business to the applicants intending to set up office(s) in India.

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