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News
2020-10-12
A comprehensive guide for foreigners doing business in India
By Arpita Dutta, Legal Consultant, Louis International Patent Office
A foreign company needs local legal person and he/she need not be a shareholder. Indian Laws allow foreigner to keep 100% ownership by subscribing shares of Indian company. A foreign Company can become a Parent company of the Indian Subsidiary holding 100% shares.
A company must incorporate under the Companies Act 2013 of India in the following ways:
A foreign company needs local legal person and he/she need not be a shareholder. Indian Laws allow foreigner to keep 100% ownership by subscribing shares of Indian company. A foreign Company can become a Parent company of the Indian Subsidiary holding 100% shares.
A company must incorporate under the Companies Act 2013 of India in the following ways:
| As an Indian company |
Private Limited Company |
100% FDI, under the automatic route in many industries |
| Incorporate as owned subsidiary or joint venture | ||
| Minimum 2 Directors and 2-200 shareholders | ||
| One of Director must be both an Indian Citizen and Indian Resident. But he/she might not be a shareholder of the Company. | ||
| Approval from appropriate individual Govt Authorities | ||
| Limited Liability Partnership (LLP) | Partnership based on an agreement | |
| Minimum two partners required, who shall be individuals and one of them must be a person resident in India | ||
| Partner’s liability up to agreed contribution | ||
| Required approval by RBI | ||
| As a Foreign entity |
Branch Office |
Limited to the activity as parent company is engaged |
| Required approval by RBI | ||
| Liaison Office | cannot undertake any commercial activity | |
| Required approval by RBI | ||
| Project Office | Can execute only specific projects as approved | |
| Required approval by RBI |
