At the time of closure of a Liaison Office (LO) / Branch Office (BO), transfer of assets of such LO/BO to their subsidiaries or other LO/BO or to any other entity required the prior approval of the RBI.
To simplify the process of closure of LO/BO/ Project office (PO) and transfer of assets, RBI has delegated the power relating to transfer of assets of LO/BO/PO to AD Category-I banks subject to the conditions specified in relevant circulars. The proposals will be considered only from the LO/BO/PO that complies with the operational guidelines in relation to setting up of LO/BO/PO stipulated by the RBI. Further, the assets should have been acquired by the LO/BO/PO from inward remittances and no intangible assets such as good will, pre-operative expenses should be included and no revenue expenses such as lease hold improvements incurred by the LO/BO be capitalised and transferred. A certificate from the statutory auditor providing various details of the assets being transferred is also to be submitted.