How to Register an Indian Subsidiary Company – Complete Process & Requirements

An Indian Subsidiary Company Registration is one of the best ways for foreign companies to establish a strong presence in India. It is a business entity where a foreign company owns more than 50% of its share capital. The subsidiary operates as an independent legal entity but is controlled by the parent company, ensuring compliance with Indian laws and regulations.

What is an Indian Subsidiary Company?

An Indian Subsidiary Company is incorporated under the Companies Act, 2013. The foreign parent company holds a majority of shares, making it the controlling entity. The subsidiary enjoys benefits such as limited liability, a separate legal identity, and eligibility for various government schemes and incentives.

Key Benefits of Registering an Indian Subsidiary

There are several advantages of setting up an Indian subsidiary company:

• 100% Foreign Ownership: In most sectors, 100% FDI (Foreign Direct Investment) is allowed under the automatic route.


• Limited Liability: Shareholders' liability is limited to the amount of their investment in the company.


• Separate Legal Identity: The subsidiary is considered a separate legal entity from its parent company.


• Tax Benefits: Eligible businesses are entitled to certain tax benefits and deductions.


• Access to the Indian Market: Allows expansion into one of the world’s largest and fastest-growing economies.

 

Requirements for Indian Subsidiary Registration

• Directors: A minimum of 2 directors (one of whom must be an Indian resident).


• Shareholders: A minimum of 2 shareholders (a foreign parent can be one).


• Capital: No minimum paid-up capital requirement.


• Registered Office: The registered office must have an Indian address for official correspondence.

Documents Required

• Identity and address proof of directors and shareholders.


• copyright and proof of address for foreign nationals.


• PAN card for Indian directors.


• Proof of registered office address (rent agreement/utility bill).


• Memorandum of Association (MOA) and Articles of Association (AOA).

Step-by-Step Process for Registration

1. Obtain DSC and DIN: Digital Signature Certificate (DSC) and Director Identification Number (DIN) for directors.


2. Name Approval: Apply for company name approval with the Ministry of Corporate Affairs (MCA).


3. Drafting MOA and AOA: Prepare company charter documents.


4. Filing for Incorporation: Submit the SPICe+ form and other required documents to the MCA.


5. Certificate of Incorporation: Once approved, the subsidiary is legally registered.


6. PAN & TAN Application: Obtain PAN and TAN for tax purposes.


7. Opening Bank Account: Open an Indian bank account in the company’s name.

 

Post-Incorporation Compliance

• GST registration (if applicable).


• Filing annual returns and financial statements with the ROC.


• Maintaining proper accounting and statutory records.


• Adhering to FDI compliance and RBI reporting norms.

Conclusion

Registering an Indian Subsidiary Company is an excellent way for foreign businesses to enter the Indian market while retaining correct control and ownership. With the right documentation and proper compliance, setting up a subsidiary in India can be a seamless process.