INDIAN SUBSIDIARY

Have you ever wondered why so many global founders and entrepreneurs—both Indian-origin and international—choose India as their business expansion hub?
It’s not just about numbers or market size; it’s about unlocking a vibrant ecosystem rich in skilled talent, cultural diversity, and entrepreneurial energy.

India offers foreign businesses a unique opportunity to make a lasting impact while benefiting from a growing economy and progressive business environment.

Documents Required

1. From the Foreign Parent Company

2. For Directors and Shareholders (Indian & Foreign Nationals)

3. For the Indian Subsidiary (New Company)

Certificate of Incorporation (apostilled or notarized)
MOA and AOA
Board Resolution approving investment in the Indian subsidiary
Power of Attorney authorizing a person to act on its behalf in India
Identity & Address Proof of authorized signatory

PAN Card/ Passport (mandatory for foreign nationals – apostilled/notarized)
Address Proof
Passport Photograph

Registered Office Proof(Rent agreement/NOC)
MOA and AOA
Proposed Company Name(s) (for name approval)

Registration Process

Reserve Name via the MCA RUN or SPICe+ portal
Prepare Incorporation Documents
File SPICe+ Part B Form (for registration, PAN, TAN, GST, ESIC, EPFO)
Obtain Incorporation Certificate
Open a Bank Account in India
Comply with FDI rules (file FC-GPR with RBI if foreign funds are remitted)

FAQs

After receiving foreign investment, the Indian subsidiary must file the FC-GPR form with RBI within 30 days of share allotment, obtain a Foreign Inward Remittance Certificate (FIRC) from the bank, submit KYC documents, and comply with FEMA regulations regarding foreign investment.

It must pass board/shareholder resolutions complying with Companies Act ) and file PAS-3 with ROC (file FC-GPR with RBI in case foreign investment is involved ).

Yes, foreign parents can lend to Indian subsidiaries under ECB norms. Loans must meet RBI guidelines including minimum maturity periods, appropriate interest rates, and require prior approval or reporting depending on loan amount and purpose.

Generally, ESOPs are issued only to employees of the Indian subsidiary or its Indian affiliates. Issuing ESOPs directly to foreign parent employees is complex and requires compliance with multiple jurisdictions, often making it impractical.

The Indian subsidiary generally continues to operate as a separate legal entity. The new parent company inherits ownership and control. However, any change in shareholding or management structure must be reported to Indian authorities.

Share transfers are subject to sectoral FDI caps, pricing guidelines, and reporting requirements under FEMA. In some sectors, prior government approval may be needed.

The Companies Act, 2013 provides protections such as the right to call for shareholder meetings, seek information, object to certain resolutions, and approach the National Company Law Tribunal (NCLT) for oppression/mismanagement claims.

Imports attract Integrated GST (IGST) which can be claimed as input credit; exports are zero-rated supplies eligible for input tax refunds. Proper GST invoicing and compliance are essential to avoid penalties and blocked credits.

IP ownership should be clearly defined via agreements. Typically, the parent owns the IP and licenses it to the subsidiary. Registering IP locally in India under the subsidiary is advisable, with arm’s length pricing for IP transactions

Foreign nationals must obtain valid employment visas or work permits sponsored by the Indian subsidiary to work legally in India.