The Economic status of India has always seen a rapid growth in all these years. The potential that humans and the industry market have is calculated to be over 1.2 billion in number. During the time of economic progress, India has appealed to a massive amount of opportunities into the country for Foreign Direct Investments. Every year, many business operations started by Non-resident Indians higher the financial inflow through FDI into India. Below is the detailed description on how foreign companies can start their business and How to register a company in India.
Entry Schemes that Foreign Businesses Seek for LLP in India
India sees two kinds of admission schemes when a foreign business wants to have startup in India. How to register a company in India or create a company’s established branch has its set of steps to be followed.
Amalgamation of an LLP in India or Private Limited Company is considered the simplest and quickest scheme for entry into India for a Foreign individual or a corporation. Investing a 100% through Foreign Direct Investment into a Private Limited or Limited Liability Partnership, LLP in India beneath the automatic scheme where the Central Government permission is not required. Thus, the introduction of a Private Limited Company with a single and sole owner holding a subsidiary of the foreign firm or a Limited Liability Partnership serves as the Cheapest, simplest and quickest scheme to enter India as a Foreign individual or a company.
Registering a Liaison office or Branch office or a project-based office will need the approval or permission from RBI or Central Government. This is very inefficient in cost and the amount of time it takes to get the actual registration done. It is to be understood that the cost involved in setting up a Branch office for a foreign-based company is more expensive than setting up an LLP in India. As per the law, a foreign national does not have the eligibility to start a branch office in India.
How to Register a Company in India as a Foreign Corporation
To start a Private Limited Company or an LLP in India, a minimum of two individuals should pose, as Directors with two people or corporate bodies should be the shareholders. According to the Incorporation Rules in India, it is a must that the person holding the position of the Director of the company should be a Citizen of India and also a Resident.
Legally, as an individual organization incorporating with a foreign company, it is required to have three Directors in total, two of them being foreigners and the third, an Indian Citizen. It is to be noted that legally there is no need for a minimum shareholding with the company and hence 100% shares can be entitled to the overseas citizen only.
A valid address will be required to be registered as the local office address of the business being registered. The legal prerogative will depend solely on the cities or metros like Chennai, Hyderabad, Mumbai, etc.in which the LLP in India is being setup.
Cost and Credentials to register LLP in India
The passport copy of the foreign national who will serve as the Director of the company will need to be submitted along with a local address proof such as bank statement, drivers license, etc. A notary from their country of residence will be required to notarize the photocopy of the original proof that is being submitted. An Indian embassy present in the country is also qualified enough to notarize.
- The Resolution Board
The Resolution Board from the overseas company will authorize the investment made in the Indian business, if the corporate is part of the shareholders committee. The copy from the Resolution Board should also be notarized and certify a Go-Ahead for the collaboration with the foreign company. It is not a must for the foreign director to be present during the amalgamation process, thus making the whole operation of business much hassle free for the foreign national.
The whole business deal is comparatively economical. After learning how to register a company in India, within a few weeks of process initiation, the registration can be completed making India, as a country, a feasible place for origin of a business by a foreigner.
- Post Amalgamation Customs
Once the process is complete, an account in the local bank needs to be opened for the corporation in India by the Director in India. RBI needs to be informed of the FDI reporting once the account has been created. Only once the FDI registration is complete will the process of reporting becomes very effortless and straightforward. The same can be done with the help of an accounting professional such as a Chartered Accountant. Once the FDI reporting is dealt with, it would guarantee that the corporate is in agreement with all guidelines in India and prepared to function.