What is a Foreign Company?
A foreign company in India is a company that is incorporated outside of India but has a place of business in
India. It is a legal entity that is separate from its parent company in the home country. Foreign companies in
India are subject to the same laws and regulations as domestic companies, with some exceptions.
To register a foreign company in India, the company must first obtain a certificate of registration from the
Ministry of Corporate Affairs (MCA). The company must also appoint a local agent in India who will be
responsible for receiving legal notices and other correspondence on behalf of the company.
Once the
company is registered, it can then start doing business in India.
What are the Ways in Which Foreign companies can be Registered in India?
There are 5 ways in which foreign companies can be registered in India:
- Wholly-owned subsidiary: This is the most common way for foreign companies to enter the Indian market.
- Joint venture with Indian Companies in case foreign investor is unable to incorporate a wholly-owned subsidiary or whatever the reason may be.
- Liaison office: A foreign company can establish a liaison office in India. It is primarily engaged with the activity of promoting the parent company’s business. Liaison offices cannot engage in any profit making activities.
- Project office: A project office in India can be established to execute projects awarded to them by an Indian Company. Project offices cannot generate any revenue in India, but they can be used to undertake activities related to the project.
- Branch office: A foreign company can establish a branch office in India to carry out its business activities in India. Branch offices can generate revenue in India and are subject to Indian taxes.
What are the documents required to register Foreign company in India?
The documents required for registering a foreign company in India:
- Certificate of Incorporation or equivalent document: This is the most important document that you will need to register a foreign company in India. It is a document issued by the foreign company's country of incorporation that proves that the company is legally incorporated.
- Memorandum and Articles of Association: These documents set out the company's constitution and the rules and regulations that govern its operations.
- List of Directors and Officers: This list should include the names, addresses, and nationalities of the company's directors and officers.
- Power of Attorney: This document authorizes an Indian resident to act on behalf of the foreign company in India.
- Address proof of the company: This can be a utility bill, a lease agreement, or any other document that shows the company's address in India.
- Identity proof and address proof of the directors and authorized representative: This can be a passport, driving license, or any other government-issued ID card.
- Consent letters from the directors: This is a letter from each director stating that they consent to the company being registered in India.
In addition to these documents, you may also need to provide other documents, such as a copy of the company's
latest audited financial statements, a certificate of good standing from the company's country of incorporation,
or a letter from the Reserve Bank of India (RBI) authorizing the company to operate in India.
The
specific documents that you will need will depend on the type of entity that you are registering and the laws of
the state in which you are registering the company. It is important to check with the Registrar of Companies
(ROC) in the state where you are registering the company to get a list of the required documents.
Steps to register a foreign company.
Obtain a DSC
Obtain a DIN
Reserve the company name
Prepare and file the incorporation documents
Obtain a PAN and TAN
Open a Bank Account
Register for ApplicableTaxes
Obtain necessary licenses and permits