A foreign corporation can start a business in India in various formats like, a project office, a representative office or by opening a branch office, in all such type the Indian entity remains a foreign entity which is subject to higher rates of taxes and stringent regulations. In case the foreign corporation have plans to operate in India on full-fledged scale just like an Indian company then a subsidiary company of such a foreign company is the answer. As a Indian Subsidiary Company it shall be subject to same set of rules which applies to any other Indian company. After liberalisation of Indian economy almost all sectors are open for foreign Investment and the incorporation can be done through automatic route. However in case the sector is not 100% open for foreign Investment then still the foreign corporation can register a Indian Subsidiary Company by obtaining an approval of the FIPB ( Foreign Investment Promotion Board) to check whether your business activity is covered under automatic route or not, kindly refer to the attached .pdf files, one is about the sectors in which automatic route is not available while other one is a list of sectors where automatic route of FDI is allowed but subject to certain conditions. kindly get back to us in case you need assistance on this.
We are discussing on documentation for a scenario where a foreign company wish to establish an Indian Subsidiary Company as private limited company. The documentation can be classified in three categories for easy understanding
With respect to holding company we shall need copies of below mentioned documents attested by secretary or ceo of the foreign company.
In India minimum two persons is required to act as promoter of the Indian company and have to continue to hold shares until the company is in existence. The foreign company can be one shareholder and there has to be another person / legal entity to hold at-least one equity share so that the number of promoter is two. In case the promoters are Individuals then they can physically sign statutory documents on their own, however in case of company being one of the promoter then following documents are required
two directors is needed out of which one shall always be a resident in India. A person which stays in India for more than 182 days during a financial year is known as resident in India. With respect to directors following documents are required.
on which directors / shareholders Signature is required:
all documents which have foreign origin or the signature is placed outside India can be accepted in India only if it is either attested by Indian High Commission / Embassy as the case may be or is Apostille in terms of Hague Convention.
In case a promoter or representative of the foreign corporation visits India in person then the documents which he brings in original or the statutory forms on which he signs in India then there are no requirements of attestation / Apostille. However, colour copy (two self-attested sets) of passport, business visa, immigration stamp showing date on which the foreign person entered in India is required.
The company have to give a physical address to the registrar of companies which shall be referred to as the registered office of the company. With respect to registered address following is
for incorporation of a Indian Subsidiary Company of a foreign company we charge Rs. 15,000 as our professional fee in case all the directors are Indian, However a sum of Rs. 10,000/- is billed as additional fee for each foreign person / entity involved in the incorporation of company. The government fee is on actual basis. Service tax @ 15% on professional fee.