A foreign company is a company or body corporate incorporated outside India that has a place of business in India, by itself or through an agent, physically or through electronic mode, and conducts business activity in India, as defined in Section 2(42) of the Companies Act, 2013. It registers with the Registrar of Companies (RoC) within 30 days of opening that place of business.
Definition
Both tests in Section 2(42) must be met: a place of business in India and business activity in India. An agent’s office or an electronic presence is enough, and Section 386(c) adds a share transfer or registration office. Electronic offering or listing of securities in an International Financial Services Centre (IFSC) has not counted since 5 August 2021 (G.S.R. 538(E)).
Governing Provision
Chapter XXII of the Act, Sections 379 to 393, governs companies incorporated outside India. Section 380(1) lists what goes to the Registrar, including the charter, the directors and the persons in India authorised to accept service. The Ministry of Corporate Affairs (MCA) prescribes the particulars in the Companies (Registration of Foreign Companies) Rules, 2014 (G.S.R. 266(E), 31 March 2014).
Key Features
Obligations fall on the overseas body itself.
Table: Obligations of a Foreign Company
| Feature | Provision |
|---|---|
| Registration, and any alteration, within 30 days | Section 380 |
| Accounts every calendar year, with a copy to the Registrar | Section 381(1) |
| Annual return under Section 92 | Section 384(2) |
| Name and country of incorporation shown at every office | Section 382 |
| Prior Reserve Bank of India (RBI) approval for any place of business | Regulation 3, FEMA 22(R)/2016-RB |
Frequently Asked Questions
No. A subsidiary formed in India is incorporated under the Companies Act, 2013, so it is a company under Section 2(20), not a body incorporated outside India under Section 2(42). That holds even where the foreign parent owns every share. The parent’s own branch office, by contrast, is the foreign company.
No. Section 2(42) of the Companies Act, 2013 counts a place of business kept through an agent or through electronic mode, so a foreign company with no office of its own is covered once it also conducts business activity in India.
No. Regulation 2 of FEMA 22(R)/2016-RB covers any body corporate incorporated outside India, including a firm or association of individuals, with no place-of-business test. Section 2(46) of the Income-tax Act, 2025 treats any company that is not a domestic company as foreign. Registrar filings follow Section 2(42) of the Companies Act, 2013.
See Also
- Foreign Direct Investment (FDI): the equity route that creates an Indian subsidiary instead.
- Foreign Exchange Management Act, 1999: the law under which the RBI approves foreign companies’ offices.
- Authorised Dealer (AD) Bank: the bank that receives the Form FNC application to open an office.
- Foreign Entity Under FEMA: the outbound counterpart for Indian investors abroad.
References
- Companies Act, 2013: Sections 2(20), 2(42), 380 to 386.
- Companies (Registration of Foreign Companies) Rules, 2014, as amended by G.S.R. 538(E) dated 5 August 2021.
- FEMA 22(R)/2016-RB dated 31 March 2016: Regulations 2 to 4.
- Income-tax Act, 2025: Section 2(46).
For the operative statutory language, refer to Section 2(42) of the Companies Act, 2013. The bare Act is available on the Ministry of Corporate Affairs website at mca.gov.in.
This is an explanatory reference, not legal advice. Statutory positions change; verify against the official source cited above.
