What is Foreign Subsidiary Company Registration?

It is a company with 50% or more of voting stock owned by another company, usually called the parent company. If the parent company is a foreign corporation then the subsidiary must follow the laws of the country where it was incorporated and operates. Starting an Indian subsidiary is the best way to set up a business in India due to the availability of 100% FDI and the government’s welcoming attitude towards foreign companies. The Indian subsidiary of a foreign company is called a "foreign company" in India. It is advantageous to set up and run a business in India because of the law for Indian subsidiaries.

Foreign Subsidiary can be formed in two ways as follows:

• Foreign Subsidiary : If a company's more than 50% owned by a foreign entity, it has to follow the laws and regulations wherever the company is incorporated.
• Wholly owned Subsidiary : A wholly owned subsidiary is a company that is comprised of all the shares, 100% of which are held by a foreign company. The rules and regulations of this company are governed by the laws in India.

Foreign Entities Can Setup Business In India By following ways:

• Wholly Owned Subsidiary Company
• Liaison Office
• Branch Office
• Project Office
• Joint Venture
• Limited Liability Partnership

To start a business in India, one must be approved by the Reserve bank of India. Foreign nations (except for those in Pakistan and Bangladesh) are allowed to start an enterprise in India.

There are two categories of making investment in India, an automatic route and an approval route. Investments following the automatic route require no prior regulatory approvals, while those taken on the approval route must be endorsed by the Reserve Bank of India.

FOREIGN SUBSIDIARY COMPANY REGISTRATION PROCESS IN INDIA

STEP 1 : SELECT COMPANY NAME

The first step is to finalize a brand name and company legal name. Consult with a professional so you can make sure the company name is available on the Ministry of Corporate Affairs (MCA) website.

STEP 2 : DIGITAL SIGNATURE CERTIFICATE (DSC)

All proposed directors of the Company must have a digital signature that will be used to file the online company registration application. One can also use the same DSC for signing documents.

STEP 3 : DIRECTOR IDENTIFICATION NUMBER (DIN)

Director Identification Number (DIN) is a unique Identification Number which is allotted to every person who intends to become a director in a company. Applications for the allotment of DIN can be made in the Spice+ form at the time of company's registration.

STEP 4 : NAME APPROVAL

For name approval, an application is filed in the prescribed Form SPICE+ Part A with the Ministry of Corporate Affairs.

STEP 5 : SUBMISSION OF FINAL INCORPORATION FORM (SPICE+) ALONG WITH MOA & AOA.

After name approval, one needs KYC and other prescribed documents of Directors & Shareholders. After submission of Spice+ form to MCA one will get Certificate of registration along with PAN & TAN.

As per the recent amendment, a new form has been introduced named as AGILE Submission of this form will provide registration of EPFO, ESIC & GST of the Company

STEP 6 : BANK ACCOUNT OPENING

Open your bank account for your business and take the necessary steps to launch it.