Foreign Company Registration in India
India is among the fastest growing economies of the world. With great opportunities and plenty of business options India is one of the most desired place for investment and setting up of business for NRIs and Foreign Companies. The successful way for investment is by Foreign Company Registration in India or Incorporating a Foreign Subsidiary in India.
Foreign Subsidiary Company- Meaning
A subsidiary is a company with voting stock (that is more than 50%) controlled by another company, usually referred to as the parent company or the holding company.
Where parent company owns a foreign subsidiary in India, the subsidiary company must follow applicable laws in India.
How to incorporate a Foreign Subsidiary in India?
Selecting the type of Company-
According to FEMA guidelines, Foreign Direct Investment (FDI) is not allowed in case of Proprietorship, Partnership Firm and One Person Company. Though investment in LLP’s is allowed, but it requires prior approval of the RBI.
Hence, the easiest and fastest way set up a business in India by NRI’s and Foreign Nationals/entities is through incorporation of a Private Limited Company.
Minimum requirements-
· Capital: There is no minimum capital required to form a Private Limited Company in India.
· Directors: Minimum two directors are required to incorporate a Private Company in India. Both should be individuals and at-least one of whom should be a resident of India. (A resident of India is a person who has stayed in India for at-least 182 days in the financial year).
· Shareholders: Companies Act, 2013 requires that a Private Limited Company have a minimum of two shareholders. There is no condition for residential status of shareholders. Shareholders can be either individuals or entities or a combination of both.
Procedure of Foreign Company Registration in India
Step 1. Name Approval:
Selecting a unique and acceptable name for the proposed Company is one of the important steps in the whole Incorporation process. The name should be in consonance with the Object of the Company and should not be identical to existing entities or Undesirable by Law.
Step 2. Obtaining DSC –
The next step towards Foreign Company Registration in India is applying for the DSC (Digital Signature Certificate) of the Directors. The primary documents required for obtaining DSC are as under:
· PAN for Indian Nationals and Copy of Passport for Foreign Nationals.
· Aadhar Card for Indian Nationals and Proof of Address for Foreign Nationals.
· Residence permits for foreigners, if residing in India.
· Passport size photograph
· Email ID and Mobile Number
All the above documents for foreign citizens and non-residents should be notarized and consuralized or apostilled by the competent authority, as the case may be.
Step 3. Incorporation Application:
This is the final step in the Foreign Company Registration process. It requires filing of the Memorandum and Articles of Association of the Company digitally along with various other documents duly executed by the proposed directors and shareholders.
List of Incorporation documents required for Foreign Company Registration:
· Subscriber sheet of Articles of Association
· Subscriber sheet of Memorandum of Association
· Declaration by Director in form DIR 2
· Declaration of Director in Form INC 9
· PAN Undertaking for Foreign National
· Utility Bill for Registered Address of Subsidiary Company
A
Generally, the incorporation documents are required to be self-attested by Indian Nationals. However, in case of Foreign Nationals, the process is as under:
· In the documents are signed outside India, then the same have to be notarized by a Public notary of the residence country and consularized or apostilled by the competent authority, as the case may be.
· If the documents are signed in India, then copy of Visa and stamped passport, proving his/her presence in India at the time of signing is required.
· If the subscriber is a foreign entity, then the Incorporation documents should be signed by the representative of the foreign entity. An Authorization Letter duly stating the name of the Authorized Person and the number of shares subscribed should be notarized, consularized or apostilled, as the case may be in the home country of the subscriber company.
Once the Incorporation application is approved, the Registrar would issue a Certificate with a Corporate Identification Number (CIN). The PAN and TAN of the Company would also be allotted simultaneously.
For any queries or requirements contact:-
CS Arpit Garg
8447773833
arpitgargcs@gmail.com