Background (General Facts)

Ford Motors is one of three leading automotive manufacturing companies in the United States. Based in Michigan in 1903 by Henry ford and grew to reach revenue of $150 billion and more than 370,000 employees by 1996 [1]. In the 1970’s, the automobile market for the major auto makers – General Motors (GM), Ford, and Chrysler- was crunched by competition from foreign manufactures such as Toyota and Honda. In 1999, Ford acquired the Swedish Volvo model in an attempt to compete in the foreign market and expand to other regions. Furthermore, Ford launched a full organization re-engineering business process plan called “Ford 2000″ aiming at reestablishing the company’s infrastructure. The process meant reduction in their Vehicle Centers (VCs) to only five covering the operations that spanned 200 countries. It also meant cutting redundancies and requiring Information Technology (IT) to be the driving force and the link between Ford centers worldwide.

In building Ford’s IT infrastructure, the company focused on implementing a setup that supported the TCP/IP communication protocol based on the U.S. department of Defense requirements. At those days, Ford internal network was meant to serve files transfer unlike most companies that used the network mainly for email communications. Throughout the 1990’s, Ford developed a cost effective Global Enterprise Network Integration (GENI) process to link all its locations compromising on the type of the connection and the cabling in favor of full coverage. During the same time, Ford started building its Web Farm, which was basically a set of hardware and software managed by a team for building Ford’s public website. The work started by publishing documents for technical references and moved to more advanced images from a live auto show. As a result, the website received 1 million visits a day in less than 2 years after its official launch. Throughout the end of the 90’s, Ford established its web services by increasing the amount of information published, building more intelligent and standard web application in 12 weeks period, purchasing more Netscape browsers for setup on its users’ machines, and creating a B2B server to allow the suppliers secured access to Ford’s Intranet.

In the path towards service cost reduction and bringing more business through the web, Ford worked closely with its competitors in the U.S. market GM and Chrysler to establish what came to be known as “Automotive Network Exchange” (ANX) certificate. The protocols aimed at providing a unified communications standard through the Internet to enable suppliers to provide common technology for all manufacturers. Moreover, Ford focused on making information on its web site more accessible and useful by deploying a team to manage the process of adding and updating information based on an analysis of how humans deal with information. One final aspect of Fords endeavor was to try to build a model through its infrastructure that benefited from the model implemented by Dell computers to improve their supply chain and delivery process. The direct model would not work well for automotives as it would with computers, as a result Ford worked on its retailing network remodeling and identifying what would eventually give it the extra edge in delivery time.

Enterprise Architecture Issues

Ford’s regional expansion to address the competition for market shares demanded cost management for the infrastructure upgrades
IT infrastructure places limitations on the type of application development based on the platforms
Easy access to information and prompt delivery of vital data to key individuals requires proper knowledge managementOrganizations reengineering and process remodeling is necessary when adapting new technologies to maintain the cost and increase efficiency
Supply chain errors and delays can severely affect the progress of the business and the market value of the corporation

Analysis

Infrastructure Upgrade

Since the inception of the Internet in the 1960’s, much effort has been made in standardizing how computers connect to it. In 1982, the International Organization for Standards (ISO) realized that during that period many ad hoc networking systems were already using the TCP/IP protocol for communications and thus adapted it as a standard in its model for the Internet network [2]. The main driver for IP convergence, at that period, was the growth in data traffic through wide area networks (WANs) established by local companies. Furthermore, in 1991, the Internet was open for commercial use, and that demanded a reduction in the total cost of operating the network to cope with 1 million Internet hosts that materialized in only 1-year time. Telecommunications companies like AT&T understood the potential and worked on standardizing the network offering voice services over IP networks that managed the separation between voice and data transmission [3].

At the same time, Ford had launched its plan to update its infrastructure, and seized the opportunity brought by the global movement of integrating the voice, fax transmission network with data transmission and expanded its WAN to include its offices in Europe and elsewhere. The financial benefits also came from the fact that Ford adapted the TCP/IP protocol from the beginning and made sure that all its technical infrastructure upgrades adhere to the standards. This made the transition of its system to the Internet as cost effective as it could be.

Web Technologies

Intranets employ the hypertext and multimedia technology used on the Internet. Prior to 1989, when Tim burners-Lee invented the Web [4], most applications used standard development languages such as C and C++ to create desktop applications that were proprietary and dependent on the platform. For example, applications running on a command-based operating system such as UNIX would not run under Windows, and those working for PCs might not work on Apple computers and vice versa [5]. The invention of HTML (Hyper-Text Markup Language) introduced a new model for applications that conform to the standards provided by a single program, the “Web Browser”. Unlike standard applications, the browser brought a unified interface that had a very fast learning curve. Users seem to require no additional training to work with web browsers. Furthermore, system administrators did not have to spend time installing upgrades on users’ machines, since the Intranet client/server architecture facilitated all the updates through the connection with the web server [6].

Since Ford established its Intranet, it was aiming at building web applications through the initial analysis of “Mosaic”, the early form of web browsers. The technical department at Ford used web languages to create the first web site in 1995. In 1996, the team started building applications making use of the unified “Netscape” browser that was deployed on all machines at the company, and working on a standard template to cut on the development life cycle. There was a substantial cut in training cost due to the user-friendly interface of web applications. Furthermore, the speed of development made vital applications available to different individuals across the company. For example, the B2B site allowed suppliers remote and secured access to various sections of Ford’s Intranet. In addition, the development team created an application as a virtual teardown on Ford’s website where Ford’s engineers could examine parts of competitors’ cars and evaluate any new technologies. The alternative would have been an actual trip to a physical location where Ford tears down cars to examine the parts.

Knowledge Management

While there are many definitions for knowledge, each company might adapt its own based on how it analysis data and information to acquire knowledge. The University of Kentucky, for example, defines knowledge as “a vital organization resource. It is the raw material, work-in process, and finished good of decision-making. Distinct types of knowledge used by decision makers include information, procedures, and heuristics, among others… ” [7].

Organizations go through different activities to manage the amount of information they collect to form the knowledge base of the company. Activities include creating databases of best practices and market intelligence analysis, gathering filtering and classifying data, incorporating knowledge into business applications used by employees, and developing focal points for facilitating knowledge flow and building skills [8].

Ford was excited about the traffic it was receiving on the Web site and everyone was publishing all the material they have on desk on the Intranet. Nevertheless, there was a growing concern about the usability and usefulness of the material people were adding. As a result, Ford created a “Knowledge Domain Team” to build complete information in nine areas that were identified as vital to the business. The process Ford took was based on surveys and specialists input in how people perceive information, and what is considered vital and what is distracting in the structure of Ford’s website. The aim behind the initiative was to reduce the time individuals spent in searching for information through proper indexing of the website content, and making sure that what was important could be accessed in due time, and what is trivial did not overwhelm the researcher with thousands of results.

Business Re-engineering

In the area of organization’s re-engineering process innovation is the set of activities that achieve substantial business improvements. Companies seeking to benefit from process innovation go through the regime of identifying the processes, the factors for change, developing the vision, understanding the current process, and building a prototype for the new organization. History shows that organizations who define their processes properly will not have problems managing the issues and developing the change factors [9]. When introducing technology, business redesign is necessary. The industrial fields have been using Information Technology to remodel processes, control production, and manage material for generations. However, it is only recently that companies recognized that the fusion of IT and business would go beyond automation to fundamentally reshaping how business processes are undertaken [10].

When foreign companies were allowed to compete in the U.S. market, Ford understood that to succeed in business in a competitive arena it needed to implement strategies that competitors find difficult to imitate [11]. As a result, Ford bought Sweden Volvo to enter the European market, and partially owned Mazda to have a competitive edge with Japanese cars1 [12]. To achieve that it re-engineered its production development activities and global corporate organization and processes for dramatic cost reduction. Furthermore, it understood that expansion requires collaboration and alignment, and thus planned to establish the IT infrastructure through a WAN that connected all the offices. In the process of innovation and re-engineering, Ford has set policies to manage the cost of establishing the network, built models for continuous implementation, and organized global meetings to align all parties with the process. Adding to that, when it came to managing the website, Ford facilitated an awareness campaign for all the branches to understand that Ford is using the web to collaborate and research and adapting information technology as a way to maximize its business value. The goal for Ford was to maintain its leadership in the market and to do that in the most efficient and cost effective method that is there.

Supply chain management

Supply chain management (SCM) is about coordinating between suppliers, manufactures, distributors, retailers, and customers [13]. The basic idea that SCM applications revolve around is providing information to all those who are involved in making decisions about the product or goods to manage delivery from the supplier to the consumer [14]. Studies show that reducing errors in supply chain distribution, increases revenue, enhances productivity, and reduces the order-to-fulfillment period [15].

Ford often compared its supply chain process to that of Dell’s, in an attempt to close the gaps in its own process and reach the level of success Dell has reached. The difference in the distribution model between Dell and Ford lies in the middle link of using retail shops. Since Ford cannot skip retail as a focal distribution point, it worked on establishing a network of retail shops that it owned. Ford made sure shops are not affecting each other in terms of sales, and gave them all a standard look and feel to establish itself in the consumer’s market as a prestigious cars sales retail company. Furthermore, extensive re-engineering initiatives were undertaken to enhance Ford external network by eliminating the correlation with smaller suppliers. In that way, Ford made sure that key suppliers have access to forecasting data from customers’ purchasing trends and production information to enable a faster order-to-delivery cycle. Ford vision was to create a model that allowed flexibility, predicable processes and delivered the product at the right time to the right consumer.

Conclusions

Ford is an example of how traditional organizations can mature to adapt what is current and maximizes the business value. The process that Ford went through necessitated the continuous support from management. In addition, it depended on alignment between those involved as a key for success. The correlation was not restricted to internal staff; it extended to cover competitors to reach mutual benefits, to work with suppliers to maintain similar grounds and adequate infrastructure, and to create training programs to educate all on the vision and organization’s objectives.

Ford technical progress came at a time where the Internet was yet to reach its full potential. The introduction of Fiber-optic cables in the late 90’s and the substantial increase in bandwidth would have helped Ford and cut on the cost in endured connecting its own offices. Furthermore, the ISP services that provided hosting servers were limited to only few players, which explained why Ford preferred to manage its own web server and maintain the overhead of the 24 hours uptime and backup.

From this case study, I understood the level of commitment large firms have to maintaining their position in the market. These companies know the revolving nature of business in the sense of how easy it is to fall back if they did not keep up with the change. The Ford process also shows the need for quick and resourceful thinking when faced with situations that might seem to be unfavorable. The way Ford ventured into the foreign market by acquiring local manufacturers was a strategic decision that did not only enabled Ford to merge with different technologies, but it also saved it the additional cost of establishing production centers in Japan and Europe.

Recommendations

Maintaining leadership in the market requires innovative organizations willing to reengineer to succeed.
IT fusion with the business means restructuring and remodeling to understand the role IT would play to meet the business objectives
Planning and modeling is vital when coordinating work with large teams.
Constructing websites is not about content; it is about understanding what adds value and how humans interact with information.
Knowledge management is a plan that companies need to develop as part of their initial business process modeling
It is not wrong for large firms to try to adapt to successful processes implemented by other firms.

References

Robert D. Austin and Mark Cotteleer,”Ford Motor Co.: Maximizing the Business Value of Web Technologies.” Harvard Business Publishing. July 10, 1997. harvardbusinessonline.hbsp.harvard.edu/b02/en/common/item_detail.jhtml;jsessionid=WDARNHINBSYKSAKRGWCB5VQBKE0YOISW?id=198006 (accessed July 30, 2008).
Computer History Museum, Internet History 80’s. 2006. computerhistory.org/internet_history/internet_history_80s.shtml (accessed July 30, 2008).
Darren Wilksch and Peter Shoubridge, “IP Convergence in Global Telecommunications.” Defense Science & Technology Organization. March 2001. http://www.dsto.defence.gov.au/publications/2400/DSTO-TR-1046.pdf (accessed July 30, 2008).
Computer History Museum, Internet History 80’s.
H. Joseph Wen, “From client/server to intranet.” Information Management & Computer Security (MCB UP Ltd) 6, no. 1 (1998): 15-20.
R. Boutaba, K. El Guemioui, and P. Dini, “An outlook on intranet management.” Communications Magazine (IEEE), October 1997: 92-99.
Joseph M. Firestone, Enterprise Information Portals and Knowledge Management (OXFORD: Butterworth-Heinemann, 2002), 169.
David J. Skyrme, “Knowledge management solutions – the IT contribution.” ACM SIGGROUP Bulletin (ACM) 19, no. 1 (April 1998): 34 – 39, 34.
Thomas H. Davenport, Process Innovation: Reengineering Work Through Information Technology (Watertown,MA: Harvard Business Press, 1993), 28.
Thomas H. Davenport “The New Industrial Engineering: Information Technology and Business Process Redesign.” Sloan Management Review 31, no. 4 (Summer 1990): 11-28, 12
Gary M. Erickson, Robert Jacobson, and Johny K. Johansson, “Competition for market share in the presence of strategic invisible assets: The US automobile market, 1971-1981.” International Journal of Research in Marketing (Elsevier Science) 9, no. 1 (March 1992): 23-37, 23.
Austin and Cotteleer, “Ford Motor ” , 2.
Henk A. Akkermans, et al. “The impact of ERP on supply chain management: Exploratory findings from a European Delphi study.” European Journal of Operational Research 146 (2003): 284-301, 286
Thomas H. Davenport and Jeffrey D. Brooks, “Enterprise systems and the supply chain.” Journal of Enterprise Information Management 17, no. 1 (2004): 8-19, 9.
Kevin B. Hendricks, Vinod R. Singhal, and Jeff K. Stratman. “The impact of enterprise systems on corporate performance:A study of ERP, SCM, and CRM system implementations.” Journal of Operations Management 25, no. 1 (January 2007): 65-82.

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Rohi Bano after her illness appears first time on any TV channel. Although she has been issued a discharge certificate, declaring her fully recovered both mentally and physically, the painful memory of her son untimely death coupled with the callousness of the entertainment industry towards her plight still lurks deep within her soul, tormenting her. One of the finest acting talents in the country, Roohi Bano was admitted to the medical facility in 2005 for the treatment of schizophrenia. She has now recovered and says that the task of bringing to justice the culprits responsible for her son death is central to her. Roohi Bano is known for possessing the rare quality of conveying feelings and expressions through her eyes. As an actress, she exercised full command over her emotions and knew how best to translate them into action and convert them into pieces of unforgettable drama. She says she desperately misses her co-stars of yesteryear such as Shafi Mohammad, Talat Hussain, Uzma Gillani and the late Tahira Naqvi Roohi first television appearance was in a quiz show while she was still a student. Then, Farooq Zameer offered her a chance to act in plays which she accepted while continuing her studies for a Master degree in psychology from Government College, Lahore. She married twice and also acted in a few films but television was where she belonged, and it remained her first love. Given the condition she was in before treatment, her recovery has been likened to her …

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Companies Incorporated Outside India:

Right from days of East India Company foreign companies were incorporating companies in India. After the liberalization policy Indian companies also started incorporating subsidiaries outside India. Recently many foreign companies have shown interest to open branch office or liaison office to monitor their business in India. In case they opt to incorporate a subsidiary company in India they have to follow the procedures given under the Companies Act, and also the provisions of the act will apply in to after the company is incorporated. If a company incorporated outside India wish to have a place of establishment in India without incorporating separate company for various reasons then it has to follow the procedures laid down in Part XI-sections 591 to 602.

The Act, which has been enacted to oversee the functioning of companies in India, draws heavily from the United Kingdom’s Companies Acts and although similar, is more comprehensive. The Registrar of Companies (ROC) and the Company Law Board (CLB), both working under the Department of Company Affairs, ensure compliance with the Act. Sections 592 to 602 of the Companies Act of India closely follows sections 406 to 423 of the English Act barring sections 408, 416 to 418 of the act.

Foreign Companies:

A foreign company is a company which is incorporated in a country outside India under the law of that other country and has a place of business in India. Sections 591 to 602 of the Act deal with such companies.

Foreign Companies are of two classes namely:

Companies incorporated outside India, which have established a place of business in India after April 1, 1956; and

Companies incorporated outside India, which have established a place of business in India before that date and continue to have an established place of business in India.

Part XI of the Companies Act, 1956 containing Section 591 to 608 deals with the Companies incorporated outside India i.e. a “Foreign Company.” The provisions of this part of the Companies Act, 1956 prescribes that its Sections 592 to 602 shall be applicable to Companies who are incorporated outside India which after the commencement of the Companies Act, 1956 establishes a place of business within India and Companies incorporated outside India having established place of business within India prior to the commencement of the Companies Act, 1956 and continue to have the said establishment. It says that a Company incorporated outside India and having an established place of business in India in which 50% or more paid up share capital is held by Indians then provisions of those sections shall apply to such Companies also.

Sections 592 to 602 applicable to such Foreign companies provide that they have to file with the Registrar of Companies:

Various documents giving particulars,

Returns regarding any alterations in the company,

Balance-sheet and Profit & Loss Accounts of the company,

Charges on any of the Companies’ properties in India.

It also provides that the following provisions shall apply to Indian business of a Foreign Company:

Registration of charges,

Right to obtain copies of and inspect the trust deed,

Books of account to be kept by the Company,

Annual returns to be made by the Company,

Inspection of books of accounts,

Power of Central Government to direct special audit,

Audit of cost accountants,

Power of Registrar to call for inspection and investigation

(Contained in Sections 124 to 145, 125, 127, 118, 209, 159, 209-A,, 233-A, 233B, and 234 to 246 of the Companies Act)

Section 603 of the said part XI puts certain restriction on a foreign company offering documents for subscriptions in India.

Though under the Companies Act, 1956, no formalities are required to be carried out for a Foreign Company establishing place of business in India except the filing of the documents provided for in Part XI; under the provisions of Section 29 of the Foreign Exchange Regulation Act, 1973 general or special permission of the Reserve Bank of India for continuing any place of business or establishing any place of business for carrying on activities of trade and Commercial nature by a foreign company is required.

General:

The limit of the foreign equity in an Indian Company is now increased up to 51% from the earlier 40%. In certain cases 100% foreign equity participation is also now allowed. The Government of India has entered into agreements with major foreign countries including USA for avoiding double taxation.

Section 592 merely deals with the requirements of filing various documents and information with the Registrar of Companies. The Registrar, for the purpose of this section, is the Registrar of Companies, Delhi and also the Registrar of Companies of the State in which the place of business is situated. The filing has to be done within 30 days of the establishment of the place of business. Foreign companies are required to file one set of documents with the Registrar of Companies, Delhi and the other set of documents with the Registrar of Companies of the State in which the company has established its place of business. Filing fee of Rs. 5000 has to be paid only at ROC Delhi and no filing fee be paid for filing copy with the other ROC.

If the company establishes any branch or branches of its business in India, no further information need be given, except that with the annual accounts the company should deliver three copies of a list of all its places of business in India and with reference to which the accounts are made out.

Every foreign company must conspicuously exhibit on the outside of its every office or place of business in India its name ending with the words “Limited” or “Private Limited”, as the case may be, if it is limited company, and the country of its incorporation in English as well as in the local language.

Where a foreign company carries on its business in India through an agent, the agent is required to comply with the provisions of this section (592).

A company shall be said to have a place of business in India if it has a specified or identifiable place at which it carries on business such as an office, store house, go down or other premises having some concrete connection between locality and its business.

594. ACCOUNTS OF FOREIGN COMPANY.

The provisions concerning the accounts of a foreign company are detailed in section 594. It lays down the general obligation – once in every calendar year to make out a balance sheet and profit and loss account in respect of its Indian business, under the presumption that it were an Indian company, giving details also of its subsidiaries and to deliver three copies of the documents to the Registrar. When not in English, a certified translation should also be annexed. A list of all places of business established by the foreign company in India with reference to which the balance sheet is made out should also be sent regularly.

In other words, the foreign company shall maintain books of accounts of its Indian business and file, every year, three copies of its world accounts (within nine months from the close of the financial year), Indian business accounts (within nine months from the close of the financial year) and a list of places of business established in India.

In respect of its Indian business, the foreign company is required to maintain at its principal place of business in India, proper books of accounts with respect to all sums of money received and expended by the company and the matters in respect of which the receipt and expenditure take place, all sales and purchases of goods by the company, and all assets and liabilities of the company

Where the foreign company sets up a liaison office in India, it shall prepare a “statement of receipts and payments” and a “statement of assets and liabilities” instead of a balance sheet and profit and loss account. These shall be in the prescribed form and shall be duly audited, the auditor giving his report as to the truth and fairness of the receipt and payments during the financial year

The Government has granted several exemptions and made modifications in regard to the above, in the light of its general policy as to foreign companies. Exemptions are also given to liaison offices. Special clarifications are issued in regard to foreign shipping, airline and insurance companies and also trade and industrial activities of foreign companies

The documents are to be filed with the Registrar within a period of nine months of the close of the financial year of the foreign company or within such period as extended by the Registrar not exceeding three months.

Provisions Relating To Foreign Companies:

(1) Foreign companies which, after the commencement of this Act, establish a place of business within India shall, within thirty days of the establishment of the place of business, deliver to the Registrar for registration -

(a) a certified copy of the charter, statutes, or memorandum and articles, of the company or other instrument constituting or defining the constitution of the company; and, if the instrument is not in the English language, a certified translation thereof;

(b) the full address of the registered or principal office of the company;

(c) a list of the directors and secretary of the company, containing the particulars mentioned in sub-section (2);

(d) the name and address or the names and addresses of some one or more persons resident in India, authorized to accept on behalf of the company service of process and any notices or other documents required to be served on the company; and

(e) the full address of the office of the company in India which is to be deemed its principal place of business in India.

(2) The list referred to in clause

(c) of sub-section

(1) shall contain the following particulars, that is to say :-

(a) with respect to each director, -

(i) in the case of an individual, his present name and surname in full, any former name or names and surname or surnames in full, his usual residential address, his nationality, and if that nationality is not the nationality of origin, his nationality of origin, and his business occupation, if any, or if he has no business occupation but holds any other directorship or directorships, particulars of that directorship or of some one of those directorships; and

(ii) in the case of a body corporate, its corporate name and registered or principal office; and the full name, address, nationality, and nationality of origin, if different from that nationality, of each of its directors;

(b) with respect to the secretary, or where there are joint secretaries, with respect to each of them -

(i) in the case of an individual, his present name and surname, any former name or names and surname or surnames, and his usual residential address; and

(ii) in the case of a body corporate, its corporate name and registered or principal office :

Provided that, where all the partners in a firm are joint secretaries of the company, the name and principal office of the firm may be stated instead of the particulars mentioned in clause (b) of this sub-section.

(3) Clauses (2) and (3) of the Explanation to sub-section (1) of section 303 shall apply for the purpose of the construction of references in sub-section (2) to present and former names and surnames as they apply for the purposes of the construction of such references in sub-section (1) of section 303.

(4) Foreign companies, other than those mentioned in sub-section (1), shall, if they have not delivered to the Registrar before the commencement of this Act the documents and particulars specified in sub-section (1) of section 277 of the Indian Companies Act, 1913 (7 of 1913), continue to be subject to the obligation to deliver those documents and particulars in accordance with that Act.

When any change occurs in the above particulars, the Registrar must be intimated accordingly. According to section 596 any process, notice, or other document required to be served on a foreign company shall be deemed to be sufficiently served, if addressed to any person whose name has been delivered to the Registrar under the foregoing provisions of this Part and left at, or sent by post to, the address which has been so delivered:

Provided that -

(a) where any such company makes default in delivering to the Registrar the name and address of a person resident in India who is authorized to accept on behalf of the company service of process, notice or other documents; or

(b) if at any time all the persons whose names and addresses have been so delivered are dead or have ceased so to reside, or refuse to accept service on behalf of the company, or for any reason, cannot be served;

a document may be served on the company by leaving it at, or sending it by post to, any place of business established by the company in India.

The Indian accounts have to be drawn up in Indian rupees as per the requirements of Schedule VI.

Under Regulation 22 of the Companies Regulations, 1956 the registrar having jurisdiction over Delhi must maintain a Register of Foreign Companies in Form III. In that the names of foreign companies must be entered in the order in which the documents referred to in section 592 of the Companies Act are delivered to the Registrar.

The company has to address all communication to The Registrar of Companies, NCT of Delhi and Haryana.

Court’s jurisdiction:

The jurisdiction will be decided with reference to the filing of documents and information pursuant to Section 592. Clause (d) of sub-section (1) requires the foreign companies to furnish particulars about the names and addresses of some persons on whom notices can be served insofar as the foreign company is concerned.

In the case of amalgamation of branch of a foreign company in India with the transferee company jurisdiction of High Court for sanctioning under section 391/394 read with section 591 and 597(1) it is the jurisdiction of registered office or place of business which would decide the jurisdiction of any High Court to entertain the petition for approval of amalgamation scheme under section 391/394 and not Delhi. [Bank of Muscat S.A.O.G, In re. (2004) 60 CLA 325 (Kar.)]

Establishment of Place of Business in India- FEMA Requirements:

The Foreign Exchange Management Act, 1999(FEMA) has framed Regulations relating to establishing any place of business in India. The Foreign Exchange Management (Establishment in India of Branch or Office or other place of business) Regulations, 2000 (Regulations) provides for establishment by a non-resident any place of business, which would be a Liaison office or Project office or site office or branch office.

In terms of the Regulation the following two points are noteworthy:

No person resident outside India shall, without prior approval of the Reserve Bank establish in India any place of business-be it branch or a liaison office or a project office or any other business by whatever name called.

Citizens of Pakistan, Bangladesh, Sri Lanka, Afghanistan, Iran or China cannot establish any place of business- be it branch or a liaison office or a project office or any other business by whatever name called, unless they procure RBI permission in this regard.

Place of Business-what they are?:

The Regulations define various place of business as under-

‘Liaison Office’ means a place of business to act as a channel of

communication between the Principal place of business or Head Office by

whatever name called and entities in India but which does not undertake

any commercial /trading/ industrial activity, directly or indirectly, and

maintains itself out of inward remittances received from abroad through

normal banking channel.

‘Project Office’ means a place of business to represent the interests of the

foreign company executing a project in India but excludes a Liaison

Office.

‘Site Office’ means a sub-office of the Project Office established at the

site of a project but does not include a Liaison Office.

Thus, while a Liaison office is only a channel for facilitating communication between the principal entity abroad and that in India, existing without any commercial activity the Project office is one for executing specific projects in India. A Site office is an extension of project office in the very site where the work is done.

“Branch office”, in relation to a company means -

(a) any establishment described as a branch by the company; or

(b) any establishment carrying on either the same or substantially the same activity as that carried on by the head office of the company; or

(c) any establishment engaged in any production, processing or manufacture,

but does not include any establishment specified in any order made by the Central Government under section 8.

Forms and Procedure:

A person resident outside India desiring to establish a branch or liaison or project office in India shall apply to the Reserve Bank in form FNC 1. In respect of Project office, the person resident outside India should have secured from an Indian company a contract to execute a project in India and the project is funded directly by a bilateral or multilateral International Financing Agency or the project has been cleared by an appropriate authority or a company or entity in India awarding the contract has been granted term loan by a Public Financial Institute or a bank in India for the project.

Permitted activities:

Paragraph 6 of the Regulations sets out the activities to be undertaken by a branch or other office in India. Schedule I of the regulations details the activities that can be carried out by Branch and Schedule II list out the activities that can be carried out by liaison office. Except when permitted by RBI, the branch or liaison office shall carry out no other activity, other than those specifically permitted by these schedules.

As per Schedule I of the Regulations the following are the permitted activities for a branch in India of a person resident outside India:

Export/Import of goods

Rendering professional or consultancy services.

Carrying out research work, in which the parent company is engaged.

Promoting technical or financial collaborations between Indian companies and parent or overseas group company.

Representing the parent company in India and acting as buying/selling agent in India.

Rendering services in Information Technology and development of software in India.

Rendering technical support to the products supplied by parent/group companies.

Foreign airline/shipping company.

In terms of Schedule II a liaison office in India of a person resident outside India is permitted to carry out the following activities:

Representing in India the parent company/group companies.

Promoting export import from/to India.

Promoting technical/financial collaborations between parent/group companies and companies in India.

Acting as a communication channel between the parent company and Indian companies.

Remittance of Profit or Surplus:

A person resident outside India permitted by the Reserve Bank under Regulation 5, to establish a branch or Project Office in India may remit outside India the profit of the branch or surplus of the Project on its completion, net of applicable Indian taxes, on production of the following documents, and establishing the net profit or surplus, as the case may be, to the satisfaction of the authorized dealer through whom the remittance is effected.

For remittance of profit of a branch, -

a) certified copy of the audited balance-sheet and profit and loss account for the

relevant year;

b) a Chartered Accountant’s certificate certifying, -

i) the manner of arriving at the remittable profit,

ii) that the entire remittable profit has been earned by undertaking the

permitted activities, and

iii) that the profit does not include any profit on revaluation of the assets

of the branch.

For remittance of surplus on completion of the Project, -

certified copy of the final audited Project accounts;

a Chartered Accountant’s certificate showing the manner of arriving at the remittable surplus;

income tax assessment order or either documentary evidence showing payment of income tax and other applicable taxes, or a Chartered

Accountant’s certificate stating that sufficient funds have been set aside for meeting all Indian tax liabilities; and

auditor’s certificate stating that no statutory liabilities in respect of the Project are outstanding.

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January 2nd, 2012 by admin | Comments Off

Aviation Technology Schools award Associate of Applied Science and Bachelor of Science degrees and certificates. Degree options in include Air Traffic Control, Aviation Administration, and Professional Piloting. Certificates and Associate of Applied Science degrees are also offered in Airframe and Powerplant (A&P, which is responsible for design), as well as pilot training. Programs may follow semester schedules.

The discipline of Aviation Technology is responsible for conducting research in navigation systems, aviation safety, aviation design, aviation infrastructure, and piloting. Aviation Technology Schools declare that training is conducted in state-of-the-art facilities designed for excellent learning experiences with simulation devices and modern facilities for providing advanced education and conducting research projects.

Programs of study in Aviation Technology provide knowledge of aeronautical maintenance technology; aircraft dispatch; aircraft mechanics; Airframe and Powerplant (A&P, design); aviation electronics technician; aviation maintenance technology; and avionics. Most quality programs provide hands-on training for the real-world experience; job placement assistance; convenient day or evening classes; and financial aid is offered to those who qualify.

All graduates of Aviation Technology programs will have developed an understanding of aircraft operating performance and limitations; weather and atmospheric processes and conditions; Federal Regulations and the U.S. air traffic control system; navigation within the National Airspace System; airport lighting and marking; the use of FAA publications for operating aircraft within the National Airspace System; all aspects of Air Traffic Control operations and facilities; aircraft separation during taxi, takeoff, and landing; fundamentals of radar theory and radar systems; vectoring and speed control of aircraft; techniques of longitudinal, vertical, and lateral separation of aircraft, and more.

Aviation Maintenance Technology, or Aviation Technology – Maintenance, programs prepare the student as a professional Aviation Maintenance Technicians, a highly skilled profession in which technicians have the responsibility for keeping aircraft in air worthy condition.

The Aviation Technology Associate of Applied Science (AAS) – Airway Science Degree program includes the required FAA license courses and courses in English, communications, and electives required by standard university AAS degrees.

Professional Piloting programs in Aviation Technology Schools prepare students for positions in the aviation industry as airplane pilots. Theory and flight training is provided through curriculums approved by the FAA.

Aviation Technology certificate programs include only the Federal Aviation Administration approved courses required for the Airframe and Powerplant (A&P) Mechanic’s License. This program requires laboratory classes working on aircraft and aircraft components.

Bachelor of Science degrees in Aviation Technology require additional studies to include the general education requirements for baccalaureate degrees, along with specific aviation courses for the particular degree discipline.

The U.S. Transportation Security Agency (TSA) requires that prospective Aviation Technology students present verification of U.S. citizenship before beginning any flight or airplane simulator training. Non-U.S. citizens interested in taking flying or simulator courses must contact school office for information on registrations and procedures.

It is very important for Aviation Technology students to understand that programs of study in Aviation Technology disciplines require very rigorous preparation. Students must be prepared to follow all Aviation Technology institutional recommendations to ensure academic and professional career progress. Read carefully and fully understand student responsibilities and guidelines required by Aviation Technology Schools.

If you are interested in learning more about Aviation Technology Schools and programs of study, please search our site for additional information and resources.

DISCLAIMER: Above is a GENERAL OVERVIEW and may or may not reflect specific practices, courses and/or services associated with ANY ONE particular school(s) that is or is not advertised on SchoolsGalore.com.

Copyright 2006

Michael Bustamante, in association with Media Positive Communications, Inc. for SchoolsGalore.com

Notice to Publishers: Please feel free to use this article in your Ezine or on your Website; however, ALL links must remain intact and active.

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December 28th, 2011 by admin | Comments Off

In this short montage, we examine some of the many tools the Video Communications Center (VCC) at Missouri S&T utilizes to make online learning easier. Included at the end of the video is a list of some of the graduate degree and certificate programs Missouri S&T offers online. For more info on the VCC: vcc.mst.edu And more about Missouri S&T’s online programs dce.mst.edu

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April 7th, 2011 by admin | Comments Off

Carattini Vicente (11 November 1939-7 November 2005) was a famous singer and composer from Puerto Rico Christmas related songs.Carattini born and raised in the city of CIDR, Puerto Rico, where he completed his primary and secondary education. One day the father saw that Carattini Young with the popular Puerto Rican music was intrigued and gave him a Puerto Rican cuatro. A Puerto Rican cuatro is a stringed instrument something like a guitar but smaller. The Puerto RicoCuatro has five pairs of strings for a total of ten, and is different from Cuatro in other Latin American countries (for example, the four-stringed Venezuelan cuatro). At the age of nine, learned to play the cuatro Carattini asks the city to those who could teach him play the instrument. In 1950 his father gave him a better quality and cuatro guitar. In 1956 Carattini when she was 15, he founded the "Trio Los Juglares who devoted himself to singBoleros. The trio were the voice of Felix Felito and appeared in almost CIDRA but Felito Felix left the following year and the trio broke up. Carattini to go to school and continue his studies at the School of Jesus T. Piñero high CIDRA. In 1958 he enrolled at the Catholic University in Ponce and after a year at the University of Puerto Rico in Rio Piedras. In 1960 he received his master's certificate in 1961 and his bachelor's degree in computer science. He returnedfor …

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March 16th, 2011 by admin | Comments Off

At the Guild Hall in Southampton

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March 12th, 2011 by admin | Comments Off