Company Registration in India
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 the financial year 2015, a massive 61.6 percent 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. Here in this article, we will understand how to register a company in India by Non-Indian Nationals. It requires a very simple process with minimal legal compliances and formation costs. Most of the local offline businesses prefer proprietorship. Here in this article we will understand how to register a proprietorship firm in India.
Company Registration in India is regulated by the Companies Act, 2013 and Rules made are administered by the Ministry of Corporate Affairs (MCA) through office of the Registrar of Companies (ROC) in each state.
Incorporation of a Private Limited Company
It is the easiest and fastest type of India entry strategy for foreign nationals and foreign companies. Foreign direct investment of up to 100% into a private limited company or limited company is under the automatic route, wherein no Central Government permission is required. Hence, incorporation of a private limited company as a wholly owned subsidiary of a foreign company or joint venture is the cheapest, easiest and fastest entry strategy for foreign companies and foreign nationals into India.
Incorporation of a Limited Liability Partnership (LLP)
It is not recommended as an India entry strategy for foreign nationals or foreign citizens as it requires Government approval. Limited Liability Partnership is a new type entity, recently introduced in India. Hence, any foreign investment into an LLP requires prior approval from the Central Government.
Proprietorship firms or Partnership firms
These are the most basic types of business entities mostly used by very small businesses or unorganized players. Foreign investment into a proprietorship firm or partnership firm requires prior RBI approval. Hence, proprietorship firms or partnership firms are not suitable for a foreign company or foreign national investment in India.
Procedure for Company Incorporation by Non-Indian Nationals in India
- Preparation and Filing of e-Forms with MCA: Simplified Proforma for Incorporating Company Electronically (SPICe)
- Company Incorporation Process consists of the preparation and filing of the flowing E-Forms:
- 1. e-Form INC-32 – Simplified Proforma for Incorporating Company Electronically (SPICe)
- 2. e-Form INC-33: e-Memorandum of Association (SPICeMoA)
- 3. e-Form INC-34: e-Articles of Association (SPICeAoA)
Processing of e-Forms by the office of Central Registrar of Companies
- 1. Company Incorporation Certificate
- 2. DIN for Directors
- 3. Permanent Account Number (PAN)
- 4. Tax Collection and Deduction Number (TAN) to the New Company.
Company registration through Online Company registration process is the easiest and fastest procedure to register a company in India.
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