Setindiabiz is your preferred for India Entry Services.
Setindiabiz provides comprehensive legal and consultation services for foreign businesses starting operations in India. Our services include advising on incorporation, corporate law, and tax matters. We also provide legal support to the Indian subsidiary in accounting, tax filing, and payroll and protect the IPR.
How We Help
- Expert Consultation
- Eligibility Check & Advisory
- Incorporation Assistance
- Post Incorporation Services
- Tax Advisory
Indian Subsidiary Incorporation
The Process of Incorporation of an Indian Subsidiary by a foreign company is 100% online, and there is no need to visit India for this purpose. India is an open economy that welcomes investors worldwide. The Make in India initiative perfectly aligns with a favourable tax structure of just 15% for manufacturing activities . The legal framework in India allows foreign investors to do business in India either as a foreign company by setting up a Liaison, Branch, or Project office in India with prior approval of the RBI or by setting up an independent corporate structure and registering a local company or LLP in India. You can find all the options in the table below.
| As a Foreign Company (With permission of RBI and Central Govt) | By Setting up an Indian Corporate Entity (registration before ROC) |
|---|---|
|
Pricing
Basic
- Digital Signature for Two Persons
- DIN for Two Persons
- Name Search & Approval
- Drafting of MOA & Articles
- Filing of Spice Plus Form
- Certificate of Incorporation
- E-PAN & E-TAN of Company
Silver
- Bank A/c Opening Support
- INC-20A Filing
- GST Registration
- MSME Registration
- Dedicated Relationship Manager
Gold
- Everything in Silver Pack +
- Capital Remittance Support
- FDI Declaration filing
- RBI Firms Portal Registration
- Preparation of FDI Documents
- Filing of FC-GPR to RBI
- Allotment of UIN from RBI
Government fee, stamp duty & taxes on actual. For additional promoter USD 50 each.
Foreign Direct Investment in India (FDI)
The FDI (Foreign Direct Investment) plays an important role in the growth and expansion of the Indian economy. The FDI Policy of India permits the FDI in most sectors under an automatic route, wherein no specific permission is required before the establishment of a company or Indian subsidiary. The companies that are incorporated under the automatic route are required to file simplified FDI Reports in the form FC-GPR. However, certain strategic sectors have sectoral caps, and foreign investments beyond the specified limit are allowed, subject to prior approval from the central government.
| Automatic Route of FDI | Government Approval Route of FDI |
|---|---|
| Sectors of strategic importance,
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Note: FDI from countries that share a land border with India
In 2020, the government of India introduced a major change in the FDI policy, wherein restrictions were placed on the FDI originating from some countries that share land borders with India. These countries include Pakistan, Bangladesh, Bhutan, Nepal, China, and Afghanistan. The FDI originating from these countries, whether directly or indirectly, requires prior permission from the government of India. Read more on Press Note 3 of 2020
Eligibility for Subsidiary Company Incorporation for Foreigner
The first step in setting up a wholly owned subsidiary company in India by a foreign company/entity is to analyse its eligibility to Incorporate a WOS. The following are the minimum eligibility requirements for Indian Subsidiary Registration. Do not hesitate to contact us for help!
Parent Company Standing
The applicant company must be an incorporated legal entity such as a Joint Stock Company or an LLP in the home country. Documents such as a Certificate of incorporation, articles and board resolution are required.
Two Representatives
The parent company must nominate two signatories, both of whom can be foreigners or non-residents of India, to represent 100% of the shareholding. The Authorised Representative or nominee needs to be subscribed to the MOA.
One India Resident Director
A minimum of two directors is required, and the maximum number of directors is capped at fifteen (15), with at least one being a resident of India. This resident director ensures compliance with local laws and regulations.
Permitted Activities
The company's main object or proposed activities must be legal in India. Most sectors are open to 100% FDI; however, we recommend that you check the permitted FDI in a specific sector or industry.
Capital Requirements
No minimum or maximum level of capital is prescribed under the law. Therefore, the promoters are free to decide the level of capital that the subsidiary would need to run the Indian operations
Unique Name Selection
Choose a distinct name for your subsidiary that complies with the Companies Act 2013 and is not already registered by another entity. Usually, the parent name is approved by adding India to the name
Timeline for Indian Subsidiary Incorporation
The time needed to establish a wholly owned subsidiary in India mainly depends on how long it takes to prepare and authenticate the required documents. The legalization process must occur twice: the first set of documents should be legalized before submitting the company name application, and the second set must be addressed after the company name has been finalized.
Schedule Callback!Timeline for Indian Subsidiary Incorporation
The time needed to establish a wholly owned subsidiary in India mainly depends on how long it takes to prepare and authenticate the required documents. The legalization process must occur twice: the first set of documents should be legalized before submitting the company name application, and the second set must be addressed after the company name has been finalized.
Digital Signature of Promoters
The time required to obtain a digital signature (DSC) for the company may take 1-2 days, depending on the availability of the proposed shareholder or director.
Name Search & Main Objects Drafting
We conduct the name availability search within a few hours; however, as we have experienced, discussing the proposed name availability with the promoters and drafting the MOA may take time.
Name Availability Application
After receiving the phase one documents, we apply to reserve the proposed company's name with the ROC. The application is filed in Part A of the Spice Plus form.
Second Phase of Documentation
After the name of the proposed Indian subsidiary is approved by the ROC office, we will draft the Memorandum of Association & Articles and other prescribed documents. The second phase of the document would also need legalization/attestation.
Filing for Incorporation of WOS
After we receive the legalized documents of phase two, the application for the incorporation of the wholly owned subsidiary company in India is filed in Spice Plus form, where the MOA, AOA, Identity and address proof of promoters, and proof of registered office are attached. This process can take one to two days.
Incorporation Certificate
After submitting the Spice Plus form, the Registrar of Companies office checks the application and the attached documents. If everything is found in order, the Incorporation Certificate is issued.
List of Documents For the Indian Subsidiary Company Incorporation
Proper documentation plays a significant role in quickly incorporating a subsidiary company in India. The following documents are required to set up an Indian Subsidiary from the parent company, its authorised signatories, and the proposed first directors.
Documents of Patent or Holding Company
| S. No. | Name of Document | Description |
|---|---|---|
| 1. | Certificate of Incorporation | The incorporation certificate for a foreign company is issued by the company registrar's office or another designated government office. This certificate serves as proof of the legal entity. In some countries, the incorporation certificate is also referred to as a charter. |
| 2. | Articles or MOA of Company | The Articles of Association of the company act as its bylaws and are included in the incorporation documents. If there are any changes or modifications to the articles, the most recent version must be submitted. |
| 3. | Address Proof of Company | Any utility bill that is not older than sixty days and is in the name of the company, including the complete address, is accepted as proof of the company's address. Examples of acceptable documents are a telephone bill, electricity bill, or bank statement. |
| 4. | List of Directors | The list of directors for the holding company must be submitted on the company's letterhead and certified by any director of the company. This list should include the following details for each director: full name, nationality, and residential address. We will provide you with a draft format for this purpose. |
| 5. | List of Shareholders | The shareholders list must be prepared on the letterhead of the holding company and duly certified by a director. It should include the details of every shareholder holding 10% or more of the stake in the holding company. We will provide the format for this purpose. |
Documents from Proposed Directors/AR
| S. No. | Colour Photograph | Description |
|---|---|---|
| 1. | Colour Photograph | A clear and recent front-facing colour photograph is required from each director, authorized signatory, or nominee of the holding company for the proposed wholly owned subsidiary, preferably against a white background. |
| 2. | Passport | The passport is mandatory for foreign individuals, while it is optional for Indian citizens, provided they are residents of India. |
| 3. | Aadhar Card (Mandatory for Indian) | Aadhar is mandatory for all Indian persons. Ensure that the aadhar number is linked to the PAN Card and mobile number for OTP-based verification during incorporation. |
| 4. | PAN Card (Mandatory for Indian) | The Income Tax Department in India issues the PAN Card, which is a mandatory document for Indian promoters to submit to the LLP. A No PAN Declaration is filed if foreign partners do not have one. |
| 5. | Residential Address Proof | Every person acting as director, individual shareholder, or authorized representative of the nominee of the holding company must submit their current residential address proof that is not over two months old. Any of the documents below are acceptable address proof
|
Documents of the Registered Office
| S. No. | Name of Document | Description |
|---|---|---|
| 1. | Proof of Registered Address | According to Section 12 of the Companies Act 2013, every company in India is required to maintain a registered office where statutory records are kept. When incorporating a wholly-owned subsidiary, proof of the office address must be submitted in the form of a utility bill dated within the last sixty days. Examples of registered office addresses include:
|
| 2. | NOC from owner | The owner of the premises where the registered office is located must provide a No Objection Certificate (NOC) for the use of their premises as the registered office address of the Indian subsidiary of the foreign company. We would provide the NOC Format. |
Incorporation Of Communication Address:
In India, the Indian subsidiary can be registered at a “communication address” even before securing a permanent office. This temporary address helps you start the formalities while searching for the ideal premises. It’s essential to remember that within 30 days of incorporation, you need to establish a physical “registered office” in the same state and file Form INC-22 with the Registrar of Companies (ROC) to report the official address change.
Attestation or Legalisation of Foreign Documents
The documents that are signed or executed overseas need to be attested before they can be used for filing with the Registrar of Companies, RBI or any other government department. Such documents include a certificate of incorporation & articles of foreign company, passport and address proof of foreign directors, MOA, AOA, and certain declarations for the Indian subsidiary incorporation. The method of legalisation may vary depending on the location of the documents.
| Method of Legalisation | Applicability |
|---|---|
| Notary Public | Applicable in the countries which are part of the Commonwealth. Please refer to the List of Commonwealth Countries to know more. |
| Apostille | The Apostille is a simplified method of legalising documents for countries that are members of the Hague Convention. |
| Indian Embassy or Consulate | If your country is not a member of the Commonwealth Nations and is also not part of the Hague Convention. The only option for legalising your documents is to present them to the Indian Embassy for attestation. This option is a last resort and can be exercised in all scenarios. |
Parent Company Authorisation:
The parent company's board must approve and authorise a signatory for the incorporation of an Indian subsidiary. The legalisation of the board resolution and POA is required.
Schedule Callback!Step 1: Parent Company Authorisation
The parent company's board must approve and authorise a signatory for the incorporation of an Indian subsidiary. The legalisation of the board resolution and POA is required
Step 2: Name Approval for Indian Subsidiary:
The Indian subsidiary may use either a new name or the parent company name followed by "India". However, the proposed name must not infringe on someone else's trademark in India.
Step 3: Drafting of MOA, AOA, & Declarations:
The Memorandum and Articles of Association are legal documents that outline a company's purpose and internal rules. Additional declarations are required for promoters to sign.
Step 4: The legalisation of the Documents:
The MOA, AOA, and declarations signed in a foreign require attestation or legalisation, as explained above. When the signatory visits India on a Business Visa, attestation can be done in India.
Step 5: Filing of Spice Plus Application to ROC:
SPICE Plus is the e-form used to incorporate an Indian subsidiary. Scanned copies of documents are attached, and the form is digitally signed by promoters and professionals.
Step 6: Issue of Incorporation Certificate:
The Registrar of Companies issues a Certificate of Incorporation after a satisfactory review. The certificate provides conclusive proof of the company's incorporation and includes the CIN, PAN, and TAN numbers.