An 9001:2008 Certified Organisation

Formation of Indian Subsidiary

There can be two types of it based upon ownership namely

  1. 100% ownership
    • Fully owned subsidiaries (only in FDI permitted sectors as Per latest FDI policy)
  2. Less than 100% ownership
    • Joint Ventures

Indian subsidiaries enjoy same rights as basically Indian Companies. There are certain norms to the activities of proposed companies as per FDI policy of the Government. Many activities are permitted to bring 100% foreign investments whereas on some activities Government has put restrictions where Government gives permission of 100% FDI and in a few activities 100% FDI is not permitted and even Government route can not be availed. In those cases, Joint Ventures are good channel of investment, where a certain percentage is held by Indian entities. In the Joint Venture Form of working, foreign company can get a good financial resource with some ready contacts and experienced partners, however a complete privacy has to be a bit parted with.

Assistance in getting FIPB Approvals

There are two entry routes of direct investment in India (FDI):

  • Automatic Route
  • Government Route (Approval Route)

Depending upon the sector where proposed investment is to be brought in, the above segregation is done. In many a sectors, Government restricts 100% FDI like defense, telecom etc. For such sectors, one has to get the approval of Foreign Investment Promotion Board (FIPB)- a division of Finance Ministry. We assist you in getting the FIPB approvals, taking care of all the formalities so you can rest assured of our services.

Channels other than FDI:

A foreign company can also come and do business in India without investing directly. RBI has permitted such companies to have establishments in India for some limited purposes. Such forms are:

  • Liaison office
  • Project Office
  • Branch Office

Different permissions and freedoms are attached with each such office. So one has to be careful while making choice of these forms of work. RBI permissions have to be sought for each such organization subject to renewals as specified from time to time. Also, the foreign companies have to register with Registrar of Companies (ROC) within 30 days of setting up a place of business in India, besides the said RBI Approval.

Read Check List for Setting up a Foreign Company Subsidiary