formation of a wholly owned subsidiary in india (the process)
TRANSCRIPT
Wholly Owned Subsidiary by Foreign Entities
In India
• When an entity which is Incorporated outside India
(i.e. foreign country), makes 100% Foreign direct
investment(FDI) in India [as per Indian FDI policy few
sectors are permitted for 100% FDI in India], the
indian company incorporated for this purpose is
said to be wholly owned subsidiary of that foreign
entity.
• There are more exemptions available to private
limited company under the indian companies act
1956, hence most of the companies prefer to form
wholly owned subsidiary private limited company.
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Key features of WOS • WOS is regulated by Indian Law i.e. Companies
Act,1956.
• All types of business activities are permitted such as
manufacturing, marketing and service industry.
• It is treated as domestic company under indian tax
law and is eligible for all exemptions, deductions
benefits as applicable to any other Indian
company.
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Step 1-Director Identification Number
(DIN)
• Following are the requirements for DIN of foreign director
• 1. 2 Passport size photograph
• 2. Passport (if passport is in the language other than English, then the same must be translated into English & MUST be duly apostile)
• The translator must carry his details (name, signature, address) and seal on the translated document, Further it should be done by the notary of home country.
• Also the same must contain the date of birth of proposed director.
• 3. Address proof -- driving license, electricity bill, telephone bill or bank account statement (address proof should not be older than 1 year)
• ( if the proof is in the language other than English, then the same must be translated into English & MUST be duly apostle)
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• 5. Educational Qualification
• 6. Present Occupation
• If the proposed director is in foreign country then all documents must be apostiled by home country.
• & If the director is presently in India then such apostile is not required.
• The form DIN-1 will be filed and should be attested by a Chartered Accountant or a Company Secretary.
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Step-2 Digital Signature • Digital signature of any One director is needed.
• The form of digital signature should be attested by a
Chartered accountant or a company secretary.
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Step-3 Approval of Name of
Company • Applicant needs to apply in form 1A with the
registrar of companies in which the company is to be incorporated.
• The name approval form is to be attested by a Chartered Accountant or a Company Secretary.
• For approval of name Government Fees is ₹1000/-
• After the approval of name we move on to the 3rd step i.e. Registration of the company
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Step-4 Registration of the Company • After the approval of the name of the company the
applicant needs to submit the required documents
with the memorandum and articles of associations
of the proposed company .
• Memorandum is to be stamped and stamping fee
of memorandum is .15% of the authorized capital of
the company which is to be registered.
• Registration fees of the company is also required to
be paid which depends upon the authorized
capital and is shown in the chart attached.
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