Open a Branch Office in India from Taiwan

How to Register a Branch Office in India from Taiwan

A Branch Office is an extension of the foreign parent company, not a separate legal entity. For Taiwanese companies seeking to enter the Indian market without incorporating a new company, a Branch Office provides a straightforward way to carry out permitted commercial activities while retaining the parent company's legal identity. With India-Taiwan bilateral trade reaching US$12.5 billion in 2025 and over 300 Taiwanese companies operating in India, the Branch Office structure is particularly well-suited for companies that want to test the Indian market before committing to a full subsidiary.

Unlike a Private Limited Company or LLP, a Branch Office does not have a separate share capital or partners. All liabilities flow back to the Taiwanese parent company. The Branch Office can generate revenue in India, engage in export/import trade, and provide professional or consultancy services, but it cannot undertake manufacturing activities on its own. For a comparison of entry structures, see our Branch Office vs Subsidiary guide.

FDI Route and Regulatory Requirements

Establishing a Branch Office in India requires prior approval from the Reserve Bank of India (RBI). The application is submitted through an Authorised Dealer (AD) Category-I bank in Form FNC (Foreign National Company). Unlike a Private Limited Company or WOS, where FDI can proceed under the automatic route without prior approval, the Branch Office establishment follows the RBI approval route.

Press Note 3 Considerations for Taiwan

While Press Note 3 (2020) restricts FDI from land-bordering countries, Taiwan is not classified as a land-bordering country under Indian policy. The Indian government recognises Taiwan as a separate jurisdiction. However, some AD banks have historically treated Taiwan similarly to China for compliance purposes. Taiwanese companies should proactively engage their chosen AD bank and provide comprehensive beneficial ownership documentation establishing the Taiwanese origin of funds and corporate control.

Permitted Activities for a Branch Office

• Export and import of goods on behalf of the parent company
• Rendering professional or consultancy services
• Carrying out research work in areas relevant to the parent company's business
• Promoting technical or financial collaborations between Indian companies and the parent or group companies
• Representing the parent company in India and acting as buying or selling agents
• Rendering services in information technology and development of software
• Rendering technical support to products supplied by the parent or group companies
• Operating as a foreign airline or shipping company

Activities Not Permitted

A Branch Office in India cannot undertake manufacturing or processing activities directly. It also cannot engage in retail trading (except as an agent of the parent company) or acquire immovable property in India (other than leasing property for its office use). For manufacturing, Taiwanese companies should consider a Wholly Owned Subsidiary or a Private Limited Company.

DTAA Benefits for Taiwanese Companies

The Double Taxation Avoidance Agreement between India and Taiwan, signed in 2011, is particularly relevant for Branch Office operations because the Branch Office may create a permanent establishment (PE) in India, triggering taxation of business profits. Key DTAA provisions include:

• Business profits: Taxable in India only if the Branch Office constitutes a PE (which it typically does). Profits attributable to the PE are taxed in India at the applicable corporate tax rate of 35% plus surcharge and cess
• Interest: Capped at 10% withholding tax
• Royalties and fees for technical services: Capped at 10%
• Capital gains: Governed by residency-based provisions with specific rules for immovable property

The Taiwanese parent company can claim foreign tax credits in Taiwan for taxes paid by the Branch Office in India. To avail of DTAA benefits, the company must obtain a Tax Residency Certificate (TRC) from the Taiwanese tax authority and file Form 10F with Indian tax authorities. For more information, explore our DTAA Master Guide and the India-Taiwan DTAA page.

Document Requirements and Authentication

Taiwan is not a member of the Hague Convention (Apostille Convention). All Taiwanese documents must be authenticated through the India-Taipei Association (ITA) in Taipei and the Taipei Economic and Cultural Center (TECC) in New Delhi or Chennai, which is a lengthier process than apostille. For a detailed comparison, see Apostille vs Embassy Attestation.

Documents Required from the Taiwanese Parent Company

• Certificate of Incorporation or Registration of the Taiwanese company (authenticated by ITA/TECC)
• Memorandum and Articles of Association or equivalent constitutional documents (authenticated)
• Board resolution from the parent company authorising the establishment of a Branch Office in India and appointing an authorised representative
• Audited financial statements of the parent company for the last five financial years (authenticated)
• Banker's report or letter of comfort from the parent company's bank confirming the company's financial standing
• Power of Attorney in favour of an authorised representative in India (authenticated)
• Details of the parent company's activities, including nature of business, countries of operation, and number of employees

Documents Prepared in India

• Proof of registered office address in India (rent agreement + NOC from landlord + utility bill)
• Digital Signature Certificate (DSC) for the authorised representative
• Form FNC application to the RBI through the AD bank
• Form FC-1 for registration with the Registrar of Companies (ROC)

Step-by-Step Registration Process

Step 1: Prepare and Authenticate Documents

Gather all required documents from the Taiwanese parent company and have them notarised by a Taiwanese notary, then authenticated by the India-Taipei Association (ITA) in Taipei. Documents are then verified by the TECC in New Delhi or Chennai. Timeline: 2-3 weeks.

Step 2: Identify AD Bank and Submit Form FNC

Select an Authorised Dealer Category-I bank in India. The AD bank submits the application in Form FNC to the RBI on behalf of the Taiwanese company, along with all authenticated documents, financial statements, and the banker's report. The RBI evaluates the application based on the parent company's track record, financial health, and the proposed activities of the Branch Office.

Step 3: Obtain RBI Approval

The RBI reviews the application and, if satisfied, grants approval to establish the Branch Office. This process typically takes 4-8 weeks. The approval letter specifies the permitted activities, the location of the Branch Office, and any conditions attached to the approval.

Step 4: Register with the Registrar of Companies

Within 30 days of RBI approval, file Form FC-1 with the Registrar of Companies (ROC) along with the RBI approval letter and other prescribed documents. The ROC issues a registration certificate and assigns a Corporate Identity Number (CIN) to the Branch Office.

Step 5: Obtain PAN, TAN, and Open Bank Account

Apply for a Permanent Account Number (PAN) and Tax Deduction and Collection Account Number (TAN) from the Income Tax Department. Open a bank account with the AD bank in the name of the Branch Office. The initial remittance from the Taiwanese parent company must be received through proper banking channels.

Step 6: Commence Operations and File with RBI

Begin permitted activities from the registered office address. File the Annual Activity Certificate (AAC) from a Chartered Accountant in India with the AD bank within the prescribed timeline. The AAC confirms that the Branch Office is operating within the scope of activities permitted by the RBI.

Timeline and Costs

The end-to-end timeline for establishing a Branch Office in India from Taiwan is approximately 10-16 weeks:

Cost Breakdown

• RBI application fee: No government fee for RBI approval
• ROC registration fee (Form FC-1): INR 5,000-10,000
• Professional fees (CS/CA): INR 40,000-80,000
• Authentication charges in Taiwan: Approximately NT$1,200-2,000 per document
• Annual compliance costs: INR 50,000-100,000 per year
• Total setup cost: INR 60,000-120,000 plus authentication costs

Post-Registration Compliance

Branch Offices in India have significant ongoing compliance obligations:

• Annual Activity Certificate (AAC): Certified by a CA in India and submitted to the AD bank annually, confirming that the Branch Office operates within permitted activities
• Income tax return: Filed annually; Branch Office profits are taxed at 35% plus surcharge and cess (effective rate approximately 38.22%)
• GST compliance: GST registration and returns if applicable, based on the nature of services or goods supplied
• FEMA/RBI reporting: FLA Return filed with the RBI by 15 July each year
• ROC filings: Annual return (Form FC-4) and financial statements filed with the ROC
• Transfer pricing: All transactions between the Branch Office and the Taiwanese parent must comply with arm's length pricing norms

Beacon Filing provides comprehensive annual compliance and FEMA/RBI compliance services for Branch Offices.

Common Challenges for Taiwanese Companies

RBI Approval Delays

Unlike subsidiary incorporation which proceeds under the automatic route, Branch Office establishment requires RBI approval, which can take 4-8 weeks. If the AD bank raises queries about the Taiwanese company's Press Note 3 status or beneficial ownership structure, the timeline can extend further. Taiwanese companies should submit a thorough application with complete documentation to minimise back-and-forth with the RBI.

Higher Tax Rate

Branch Offices are taxed at 35% (plus surcharge and cess) on their Indian income, compared to 22-25% for domestic companies under the concessional tax regime. This higher rate makes the Branch Office less tax-efficient for long-term operations. Many Taiwanese companies start with a Branch Office to test the market and later convert to a subsidiary structure for tax optimisation.

Profit Remittance Restrictions

Profit remittance from a Branch Office to the Taiwanese parent is permitted only through the AD bank and after payment of all applicable Indian taxes. The remittance must be supported by audited financial statements and the AAC confirming that the Branch Office operates within permitted activities. Any attempt to remit profits without proper documentation can result in FEMA violations.

Activity Scope Limitations

The Branch Office can only engage in activities specifically approved by the RBI. If the Taiwanese company wants to expand into manufacturing, retail trading, or other activities not covered by the initial approval, it must either seek a fresh RBI approval or establish a separate entity (such as a WOS or Private Limited Company). This limitation makes the Branch Office less suitable for companies planning diversified operations in India.

Document Authentication Complexity

Since Taiwan is not a Hague Convention member, the authentication process through ITA and TECC is more complex and time-consuming than apostille. Each document must be individually authenticated, and the processing time at TECC (typically 5-7 working days) adds to the overall timeline. Companies should begin document preparation at least 3-4 weeks before the planned application date.

Frequently Asked Questions

Can a Taiwanese Branch Office in India manufacture goods?

No. A Branch Office in India cannot undertake manufacturing or processing activities directly. For manufacturing operations, Taiwanese companies should consider incorporating a Wholly Owned Subsidiary or a Private Limited Company in India, both of which allow manufacturing under the automatic FDI route in most sectors.

What is the tax rate for a Branch Office in India?

A Branch Office is taxed at 35% on its taxable income, plus applicable surcharge (2% if income exceeds INR 1 crore, 5% if income exceeds INR 10 crore) and 4% health and education cess. The effective tax rate ranges from approximately 37.13% to 38.22%, which is higher than the 22-25% concessional rate available to domestic companies.

How long does RBI approval take for a Taiwanese Branch Office?

RBI approval typically takes 4-8 weeks from the date of submission of a complete application through the AD bank. If the RBI raises queries about Press Note 3 applicability or requests additional documentation, the timeline can extend to 10-12 weeks. Submitting a comprehensive application with complete financial documentation and a clear beneficial ownership declaration minimises delays.

Can the Branch Office be converted to a subsidiary later?

Yes, a Taiwanese company can close the Branch Office and simultaneously incorporate a subsidiary (Private Limited Company or WOS) in India. However, this is not a direct conversion process; it involves winding up the Branch Office (with RBI approval), incorporating the new entity, and transferring assets, contracts, and employees. The process typically takes 3-6 months.

Does the Taiwanese parent company need a profit track record?

Traditionally, the parent company needed a profit-making track record for the preceding five financial years and a minimum net worth of US$100,000. However, the RBI's 2025 draft regulations propose removing these financial eligibility criteria, potentially opening the door to a wider range of Taiwanese investors. Check the current requirements with your professional advisor at the time of application.

Can a Branch Office open multiple locations in India?

The RBI approval typically specifies the location of the Branch Office. Opening additional offices in other cities requires separate RBI approval. Each additional location must be registered with the respective ROC and comply with local regulations.