Procedure of Foreign Company Registration in India

Narendra Kumar

29 Jun, 2019

Foreign Company Registration in India

A business can be set up by the foreign companies in India by full filling the conditions prescribed by the government for setting up a foreign company registration in India. India is a developing country comprising the huge population. As India provides a huge market, FDI inflows are day by day increasing.

A foreign company can be set up by the following two steps:

• Either by incorporating a new company;

Setting up a new company in India by foreign nationals is the easiest way of entering.

• Or by setting up branch/ liaison office (Liason office/ Representative office) in India.

Whereas setting up branch or liaison office requires prior approval of the Reserve Bank of India, therefore, it is a time-consuming process.

What are the mandatory requirements for setting up a foreign company in India?

• In the case of Private Limited Company, there is a requirement of at least two directors and two shareholders. Shareholders can be individual as well as the body
• One director must be an Indian resident and citizen who has stayed in India for past 186 days.
• For a foreign company, the preferred legal entity is a type of entity where there are three directors out of which two can be foreign nationals but one has to be an Indian resident.
• If we talk about shareholding then there are no such rules so foreign nationals can hold 100% shares in the company.
• Another mandatory requirement is of registered office in India. Usually, the registered office is set up by foreign Companies in metro cities.

What are the documents required for foreign company registration in India?

Following documents are required to set up a foreign company in India:

• Copy of passport of foreign nationals;
• Address proof of foreign nationals (Driving license / Bank Statement)
• Copy of original documents should be notarized in the country of foreign nationals or by the Indian embassy in the foreign director’s country.
• If a foreign company wants to become shareholders in an Indian Company then the copy of board resolution from such foreign company authorizing the investment in an Indian company.
• Foreign nationals can incorporate a company in India without being present in India.

What are the after incorporation formalities?

After company incorporation, a bank account can be opened in the name of the Company. After bank account opening there is a requirement of FDI reporting with the Reserve Bank of India.

After the above-mentioned regulations Company will get ready for operations.