HOW TO SETUP A FOREIGN COMPANY BUSINESS IN INDIA | INDIAN COMPANY REGISTRATION FOR FOREIGNERS
How to Setup a Foreign Company Business in India[/caption] Due to economic revolution and globalization, most companies in the world looking to expand their operations throughout the Globe. In the recent past due to India Economy booms and Government also open doors to foreign nations company to invest in India, many foreign companies come forward to setting up their business in India. Wholly owned Subsidiary is one of the business formation where a foreign entity can setup business in India. This blog helps in understanding about the Wholly owned subsidiary (WOS) Registration of foreign company in India
About WOS
When an Entity which is incorporated outside India (i.e Foreign Country), makes 100% Foreign Direct Investment (FDI) as per Indian FDI policy, the Indian company incorporated for this purpose is said to be wholly owned subsidiary of that foreign entity. Under the current foreign investment policy, a wholly owned subsidiary can be established either under the automatic route, if the conditions specified therein are complied with (specific high priority industries) or obtain an approval from the FIPB. This is the easy and best method for setup a foreign-based Company in India, where entire hold on the share capital of an Indian company is held by Foreign Based Entity.
Key Feature of WOS
· WOS is regulated by Indian Companies Act, 2013
· All types of Business Activities are permitted such as manufacturing, marketing, services activity etc subject to FDI Norms.
· Treated as Domestic Indian Company and Indian Taxation apply and eligible for all exemptions and deduction as applies to Domestic Companies.
Type of WOS
In India, there are two form of company incorporated
Private Limited Company has following characteristics:
· shareholders’ right to transfer shares is restricted
· the number of shareholders is limited to 200; and
· an invitation to the public to subscribe for any shares or debentures is prohibited.
· Minimum paid up capital is ₹1,00,000.
· Minimum 2 Director and 2 shareholders, One will be Indian Resident Director.
Public Limited Company has following characteristics:
· It must have at least seven shareholders.
· Minimum paid up capital must be ₹5,00,000
· It must publish a prospectus or file a statement in lieu of a prospectus before it can start transacting business.
· A public company is required to have at least three directors.
Documents required for Registration/setup of Wholly Owned Subsidiary (WOS).
1. 3 Passport Size photograph.
2. PAN CARD (Not mandatory in case of Foreign Director).
3. Passport (Mandatory for Foreign Director, Must be in English Language and duly apostle).
4. Address proof (Driving License, Voter ID, Passport, Aadhar Card).
5. Any one of following (Bank Passbook, Credit Card Statement, Telephone Bill, Electricity Bill).
6. Proof of Registered office in India-Electricity Bill, Leased deed or Rent Agreement.
7. If the proposed director is in a foreign country then all the documents must be duly apostle by the home country & if a director is presently in India then such apostle is not required.
The process required for registration/setup of Wholly Owned Subsidiary (WOS) in India.
1. Obtaining (Director Identification Number) DIN for all Directors.
2. Obtaining Digital Signature for all the directors.
3. Filling Application for Name Reservation for the proposed Company.
4. Drafting Memorandum & Articles of Association.
5. Subscription to the Memorandum by the shareholders and appropriate person.
6. Submission of all the documents to the Concerned Registrar of Companies (ROC).
7. Receipt of Certificate of Incorporation from the ROC.
8. Apply for PAN CARD and an opening of Bank Account.
9. Submission of Documents for FDI Compliance after Subscription of Share Capital.
Cost for Registering a Company in India
The cost for registering a business in India is relatively inexpensive. Registration of a company in India can also be completed within a few weeks, making India an easy place to start a business.
Post Incorporation Formalities
Post registration of the company in India, the Indian Director can help open a bank account for the company in India. Once the bank account is opened, the Company must make FDI reporting to the Reserve Bank of India. The procedure for reporting FDI inflow into the company is simple and can be completed easily by a legal or accounting professional in India. Completing the FDI reporting would ensure that the business is in compliance with all regulations in India and ready to operate.
FOR SUCH HELP FROM THE VERY BEST REGARDING REGISTRATION/SETUP OF WHOLLY OWNED SUBSIDIARY (WOS) NEEDS AND NECESSITIES, CONTACT VENTURE CARE.
