If you intend to register a company in India as a foreign investor, you must obtain approvals from the Reserve Bank of India and the Central Ministry of Corporate Affairs (MCA). You must have a registered office in India, comply with Foreign Direct Investment (FDI) guidelines and obtain Director Identification Numbers (DIN) and Digital Signature Certificates (DSC) for the directors.
In India, a foreign national can form a foreign company as a private limited company. In India, the quickest way to create a business is to form a private limited company. According to the FDI policy, FDI through the automatic route is allowed up to 100% into private limited companies. A foreign national may form a private limited company as a wholly-owned subsidiary or joint venture.
The details of steps to be undertaken in the process for new company registration in India are spelt out below:
Choose a business structure from the following types:
Private Limited Company (Including Wholly Owned Subsidiary, or WOS): The most common form for international companies growing in India is a Private Limited Company (PLC). If 100% foreign ownership is allowed in your industry, it can function as a Wholly Owned Subsidiary (WOS).
Project office: To carry out projects an Indian company has awarded them, a foreign company may set up a project office in India. Nonetheless, foreign businesses might need permission from the Reserve Bank of India to set up such a project office.
Branch Office (BO): A foreign business can open a branch office in India. The foreign company must be a sizable enterprise with evidence of profitability to open a branch office.
Liaison Office: A foreign business can set up a liaison office for all liaison operations in India. Foreign remittances from the parent company (foreign company) will cover all liaison office costs.
Joint Venture: To conduct business in India, a foreign entity will choose a local partner in India with whom it wants to form a joint venture.
Procedure for Setting Up a New Foreign Company in India
Foreign entities have two primary options to enter the Indian market:
- Set up a new company
- Relocate an existing business.
Step 1: Select the Appropriate Business Structure
Foreign investors can choose from the following options:
- Private Limited Company (PLC): Ideal for startups and businesses seeking limited liability and full foreign ownership (except in restricted sectors).
- Limited Liability Partnership (LLP): Suitable for professional firms or joint ventures with shared responsibilities.
- Liaison/Branch/Project Office: Recommended for foreign businesses looking to establish a presence without full incorporation.
Step 2: Obtain DSC & DIN
Apply for a Digital Signature Certificate (DSC) and Director Identification Number (DIN) through the MCA.
Step 3: Reserve a Company Name
- Submit a unique name request via MCA.
- Ensure the name complies with Indian naming guidelines.
Step 4: Register the Company
File incorporation forms along with:
- Memorandum of Association (MoA)
- Articles of Association (AoA)
- Once approved, receive the Certificate of Incorporation.
Step 5: Obtain Statutory Registrations
Apply for:
- PAN (Permanent Account Number)
- TAN (Tax Deduction and Collection Account Number)
- GST (Goods and Services Tax) Registration
Step 6: Open a Business Bank Account & Ensure Compliance
- Open a corporate bank account in India.
- Adhere to FEMA guidelines.
Process of Relocating an Existing Foreign Company to India
Step 1: Choose the Entry Mode
Options include:
- Wholly Owned Subsidiary (WOS): 100% foreign ownership in a private limited company.
- Joint Venture (JV): Collaboration with an Indian partner company.
- Branch Office (BO): Extension of the foreign company without full incorporation.
Step 2: Register with the Registrar of Companies (ROC)
- Register the entity under the Companies Act, 2013
- Obtain the Certificate of Incorporation.
Step 3: Transfer Business Assets & IP
- Migrate assets, contracts, and intellectual property to the Indian entity.
- Follow RBI and FEMA regulations during the transfer process.
Step 4: Acquire Tax Registrations
Get your tax registrations, like:
- PAN
- TAN
- GST Registration
Step 5: Open a Corporate Bank Account
Set up a bank account for operations in India under the name of the newly established entity.
Additional points for consideration
- Contact us for more detailed information on company setup in India. Our team has in-depth knowledge of India’s latest rules and regulations of company formation.
- You have to ensure that you have a local registered office.
How much is the company registration cost in India?
The registration cost for foreigners to open a company in India varies based on the type of business and services involved. It comprises government charges, professional/legal fees, and regulatory fees.
How can Helpline Group guide you in Registering a foreign company in India?
Helpline Group, backed by a strong and experienced team, brings over 25 years of expertise in company setup in India, offering a seamless, hassle-free experience for clients. Helpline Group in Saudi Arabia can help you relocate existing foreign companies or register a company in India as a foreign investor by following specific protocols and complying with the country’s regulations.
With a global presence and a tailored approach, we ensure that your foreign-registered company in India is handled with precision and professionalism, making us your reliable ally in achieving success.
