Circular

17th July, 2007

Circular No. IRDA/ 024/ Closure-FLO/ 2007-08

Re:Guidelines for Closure of Liaison Office established in India by Insurance Companies registered outside India

Government of India have entrusted the regulatory work pertaining to Liaison offices of Insurance companies w.e.f. 06 th December, 2005 to IRDA. IRDA’s framework for approval of opening of Liaison office of foreign insurance companies registered outside India is already placed in the website (www.irdaindia.org). In continuation thereof, the IRDA, now issues the following guidelines for closure of Liaison Office established in India by insurance companies registered outside India.

1
 Requests for closure of Liaison Office shall be submitted to Insurance Regulatory and Development Authority in form IRDA-FIC-2 attached as Annexure “1”
2

The application for closure of Liaison Offices shall be submitted along with the following documents:

a) Certified copy of the IRDA’s permission for establishing the branch / liaison office in India.

b) A Chartered Accountant’s certificate:

i) Indicating the manner in which the remittable amount has been arrived at and supported by a statement of assets and liabilities of the applicant, and indicating the manner of disposal of assets;

ii) Confirming that all liabilities in India including arrears of gratuity and other benefits to employees etc. of the office have been either fully met or adequately provided for;

iii) Confirming that no proceeds accruing from sources outside India has remained un-repatriated to India

c) No-objection/ Tax Clearance Certificate from Income Tax authority for the remittance; or an undertaking from the applicant and a certificate from the Chartered Accountant regarding undertaking to be obtained from a person making remittance of foreign exchange as advised by RBI from time to time (AP (Dir Series) Circular No.56 of 26 th November, 2002 of RBI may be referred to), and

d) Confirmation from the parent entity that no legal proceedings in any court in India are pending against the Liaison Office and there is no legal impediment to the closure/ remittance.
3
 Approval for closure and remittance of proceeds is granted provided the Liaison Office has submitted the Annual Activity Certificate for all the years for which it was in operation in India . The certificate is submitted by the Chartered Accountant of the Liaison Office, stating that the Liaison Office has complied with the terms and conditions stipulated by IRDA at the time of granting approval.




C R Muralidharan
Member



     


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