A company expands its business by opening up its branch offices in various parts of the domestic country as well as in other countries. A branch office refers to an establishment that carries on substantially the same business and activity as is carried out by its Head Office. Such offices assist the company in:
- Spreading its business to diverse locations and thus increasing the client base.
- Bringing its product closer to the clients by increasing their accessibility to it.
- Making the distribution and marketing of its services and goods easier and more effective.
Procedure for Opening Branch Offices by a Company Out of India
It is provided under the New Companies Act, 2013, according to which: In order to open new branch offices in India, a company must pass a resolution in its Board meeting specifying:
- The business to be carried out at that particular branch office.
- The appointment of somebody to look after the everyday business of the branch and operate the bank account of that branch.
- The provision for authorizing somebody to make arrangement for establishment, accommodation, and other requirements which are essential to run that branch office successfully.
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