Starting a Recruitment Consultancy: Do I Need Licenses for International Clients?

Starting a Recruitment Consultancy

I am starting a consultancy for recruitment. I need to know if I have to tie up with international clients for recruitment, and if any licenses or legal formalities are required for it.

Regards

You have to establish a company that needs to be registered (limited, proprietary, etc.). Additionally, you must register with sales tax, service tax, and VAT organizations as you are required to pay these taxes when invoicing the company. Depending on your company's registration, you will need to acquire a labor license to establish the office as a commercial establishment. If your team exceeds 10 members, you will need to register under the ESI Act, and if your team exceeds 20 members, you must register under the PF Act.

Regards,
Murali

Dear Murali, Thank you for your valuable reply. I have registered my firm as Nirvana Enterprise (Placement Service) and am currently operating in the domestic market. Now, I am setting up clients outside of India. One of my partners is suggesting that we need a license for an overseas consulate to facilitate the transfer of manpower. Please let me know your thoughts on this matter.

Thank you

Thank you for your reply. I know the legal formalities well in the Indian market, such as shop licenses, service tax numbers, PAN, etc. However, I just want to know if I do a contract with an overseas client for recruitment, will I need to complete any legal formalities with the overseas consulate?

Dear Anil,

Thanks for your reply. I am well aware of the legal formalities in the Indian market, such as shop licenses, sales tax numbers, PAN, etc. However, I want to know if I need to go through any legal formalities with the overseas consulate when contracting with an overseas client for recruitment.

Hello Mr. Nirav, it seems you may have missed something in my previous response. What I mentioned is that you need an upgrade.

In simple terms, yes, there are legal implications that can affect you and your business because you are now planning to go overseas, which means you will have income from outside India in the future. As far as I am aware, earning from outside India is subject to many rules and requires government permission for any kind of business activity. Therefore, it is advisable that you consult with a Chartered Accountant, which is the best option for you to proceed further.

Regards

Thank you, sir, for your positive reply to me. I am working at XYLOPIA Group of Zydus Cadila as an Officer in HR & Administration. My wife and her partner are running a recruitment business. Her partner mentioned that we need an overseas license before tying up with a client.

Regards,
Andrew Rao

Dear Nirav,

Congratulations on starting something new. If you are willing to work on a grand scale, as you mentioned about international tie-ups, then according to their standards and if your financial backup supports you, you can plan according to the given points:

1. Get your consultancy registered under the Companies Act. After registration, your venture will appear as a private limited company, which itself speaks volumes about your strong start and indicates to the market that you are operating as a company.

2. Try to make tie-ups with IELTS institutes providing IELTS support for your candidates, which will help them onboard or face interviews easily.

3. Develop a lucrative and informative website.

4. Establish good tie-ups at the national level in different sectors such as telecom, banking, FMCG, real estate, IT companies, BPOs, KPOs, and so on.

Following the above points will enhance your consultancy profile significantly.

Best wishes.

Regards

Regarding your query "saying that we need an overseas license before tying up with a client," please note that this will be required when you deal with unskilled/semi-skilled persons like laborers, cooks, mechanics, etc. Please go through the link below for more details: [Recruiting Agents/Agencies(RAs)](http://moia.gov.in/services.aspx?id1=120&id=m8&am p;idp=120&mainid=73)

If you are dealing with executive positions, this license won't be needed, or rather, it's not mandatory.

All the Best.

Regards, TS