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India welcomes citizens of almost all countries to invest in India. However, with effect from 17 April 2020, citizens / companies of all countries that share land border with India (Pakistan, Bangladesh, China, Nepal, Bhutan, and Myanmar) require government approval even when investing in sectors that are under automatic route. Notably, entities from other countries with beneficiary / beneficiaries from any of these countries will also need government approval.

To start a business India, a non-Resident Indians and Business Incorporated outside India have different options such as

  • Limited Company (Public and Private)
  • Limited Liability Partnership (LLP),
  • Branch Office & Liaison Office or Project Office etc.

Selection of right option of business depends on the India Business Plans and tax implications.

Procedure to Start a Business In India

Here is the procedure to start a business in India by the foreigners:

  • Define the India Business Plan: A Foreign National or a Business Registered outside India has to define the India Business Plan first. Depends on the business operations Plan, one has to select the best suited Business entity option start business in India.
  • Choose Best Suited Business Option: Choose best suited business from different options such as Limited Company, Limited Liability Partnership (LLP), Branch Office & Liaison Office or Project Office etc.
  • Documentation: Depends on the chosen Business option, the documentation process will also differ. Generally, any document executed outside India or a copy of document produced from outside India must be notarized and apostatized or attested by the Indian Embassy in their respective countries as per Hague Convention guidelines.
  • Application to respective Authorities: Again, depends on the chosen Business option, the application process shall also differ. In case of Limited Companies and Limited Liability partnerships, application is required to be filed with the Registrar of Companies (ROC), Ministry of Corporate Affairs. In case of Branch office / Liaison Office the application is required to be filed with the Reserve Bank of India and after obtaining the approval from the RBI, the entity is required to be registered with Registrar of Companies (ROC) Delhi, Ministry of Corporate Affairs
  • Obtain the Registration and proceed to Business Start-up Formalities: After obtaining the Business entity registration, the business can proceed to open bank account and proceed to appoint people and start business. Also, the busies is required to obtain other required registrations such as Goods and Service Tax Registration (GST), Professional Tax and Shops and Establishment Registration etc and start employing people

Documents Required for Company Registration in India by Foreigners

The Following are the documents that are required for online company registration in India by foreigners –

  1. Passport – Identity Proof: This is the most important document which is also a proof of identity of the foreigner to survive in India. The Passport must be notarized or apostilled in the country where it was issued. In any case, if the document is in a foreign language then it first should be translated in English and then notarized or apostilled.
    Furthermore, in case the passport doesn’t contain any date of birth of the holder then the additional document specifying the date of the birth of the Director should be duly certified or attested or notarized or apostilled.
  2. Address Proof: The second most important document which is required for the company registration in India is the address proof. In addition to the notarized Identity Proof, a notarized or apostilled address proof is also required to be submitted. The address proof must have the exact name which is mention on the Passport and the most current address of the Director. Keep in mind, the documents submitted should not be older than 1 year for foreigner National.

Following documents can be accepted as an Address Proof –

– Driving License

– Electricity Bill

– Telephone Bill

– Mobile Bill

If the documents are in a foreign language then it must translate in English first and then notarized or apostilled.

  1. Registered Office Address Proof: After the Identity Proof and the Address proof of the Director, the next is the Registered Office address of the company. Following are the documents that can be submitted as the proof of the registered office during the company registration in India-
    • The registered documents of the title of the premises of the registered office which is in the name of the company
    • The Notarized copy of the lease agreement or rental agreement= Link in case the property is on rent or lease along with a copy of the rent paid not older than one month. The name in the agreement should be in the name of the company.
    • An authorization from the Landlord (clearly specifying the name of the landlord in the electricity bill, gas bill or water bill) to use the property by the company as its registered office. It is a kind of NOC fro Landlord
    • Proof of Evidence of any utility service that depicts the address of the premises In the name of the landlord as an owner which should not be older than 2 months. Example- Telephone, gas, electricity.

The documents should be filed within the 60 days of the filing the incarnation of the company.

  1. MOA and AOA of the Company: The identity and address proof of all shareholder whether foreigner or Indian Nationals who have subscribed the Memorandum and Article of Association of the company.
  2. DIN and DSC After bundling all the documents, the last thing you need to submit is the Director Identification Number and the Digital Signature Certificate.

Documents Required from Foreign Body Corporate

If a Foreign Company is a Shareholder/ partner, the business Incorporation documents such as Certificate of Registration and Charter Documents with

  1. The Board Resolution / formal authorisation for use of name of Foreign Body Corporate
  2. Board Resolution / formal authorisation for use of Trademark of Foreign Body Corporate, if any
  3. Board Resolution / Authorisation for execution to an individual for execution of Company Incorporation Documents.

Takeaway

India as one of the fastest growing economies in the world attracts plenty of Foreign Direct Investment (FDI) and Private Equity capital. According to a recent report by Nomura, a Japanese Brokerage firm, FDI into India is likely to have hit high of $34.9 billion in financial year 2015, a massive 61.6 per cent jump from $21.6 billion in the previous fiscal. With the world’s second largest population and a large talent pool of skilled IT professionals, India continues to be an attractive destination for investment amongst Foreign Companies and Foreign Nationals.

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