Company registration in India for foreigners is done primarily through the SPICe+ web form on the Ministry of Corporate Affairs portal, and does not require the foreign promoter to travel to India. A foreign company or foreign national can hold up to 100% shareholding in an Indian private limited company in most sectors under the automatic route, subject to sector caps under the Consolidated FDI Policy and reporting through the RBI’s FIRMS portal.
Foreign investors most commonly incorporate a wholly owned subsidiary as a private limited company, since it offers limited liability, a separate legal identity, and full access to the Indian market. This guide walks through the entity choices, the incorporation process, capital and director rules, cost and timeline, and the compliance obligations that begin the day your Indian company is born.
Key Facts Table
Table 1: Company registration in India for foreigners (as at 10 February 2026)
| Parameter | Position | Source |
|---|---|---|
| Most common entity for foreign investors | Private limited company (wholly owned subsidiary) | Companies Act, 2013 |
| Minimum shareholders | 2 (private limited); 1 (OPC — Indian residents only) | Section 3, Companies Act, 2013 |
| Minimum directors | 2, of whom 1 must be resident in India | Section 149(3), Companies Act, 2013 |
| Minimum paid-up capital | No statutory minimum since 2015 amendment | Companies (Amendment) Act, 2015 |
| Incorporation form | SPICe+ (Form INC-32) with linked forms | Companies (Incorporation) Rules, 2014 |
| FDI entry route | Automatic (up to 100% in most sectors) or Government route for restricted sectors | FEMA (Non-Debt Instruments) Rules, 2019; Consolidated FDI Policy |
| FDI reporting | Form FC-GPR via the RBI FIRMS portal within 30 days of share allotment | FEMA (Non-Debt Instruments) Rules, 2019 |
| Commencement of business filing | Form INC-20A within 180 days of incorporation | Section 10A, Companies Act, 2013 |
| Registered office requirement | Physical address in India from incorporation (or within 30 days) | Section 12, Companies Act, 2013 |
What Changed for Foreign Investors Incorporating in India
- Companies (Incorporation) Rules amendments have consolidated name reservation, incorporation, PAN, TAN, EPFO, ESIC, professional tax (where applicable) and bank account requests into a single SPICe+ web form, reducing the number of separate applications foreign promoters must track.
- The RBI’s FIRMS portal remains the mandatory channel for all foreign investment reporting, including Form FC-GPR for share allotments and the Annual Return on Foreign Liabilities and Assets (FLA Return).
- DPIIT continues to issue sector-specific Press Notes that adjust FDI caps and conditions; investors in regulated sectors such as insurance, defence, telecom and digital media should check the applicable Press Note in force before finalising the shareholding structure.
What Are My Options for Setting Up a Business in India as a Foreigner?
A foreign company can enter India as a wholly owned subsidiary, a joint venture private limited company, a limited liability partnership, a branch office, a liaison office, or a project office, each carrying different liability, tax and activity restrictions. The right structure depends on whether you plan to trade, manufacture, or merely represent the parent company in India.
A wholly owned subsidiary, incorporated as a private limited company under the Companies Act, 2013, is the default choice for foreign investors who want to carry on full commercial operations — manufacturing, trading, services, or e-commerce — with limited liability protection for the parent company. It is a distinct Indian legal person, taxed as an Indian resident company, and eligible for 100% foreign shareholding in most sectors under the automatic route.
A limited liability partnership (LLP) is available to foreign investors only in sectors where 100% FDI is permitted under the automatic route without any performance-linked conditions attached. LLPs suit professional services and consultancy structures but are less commonly used for regulated or capital-intensive sectors.
Branch offices, liaison offices and project offices are RBI-regulated presences for a foreign company that does not want to set up a separate Indian legal entity. A liaison office cannot undertake any commercial activity and exists only to represent the parent company. A branch office can undertake specified commercial activities such as export-import trade and consultancy, but not manufacturing (except in limited circumstances). A project office is set up for the duration of a specific contract awarded to the foreign company in India.
Table 2: Entry structures for foreign investors in India — quick comparison
| Structure | Separate legal entity? | Liability | Typical use | Approval route |
|---|---|---|---|---|
| Private limited company (WOS) | Yes | Limited to share capital | Full commercial operations | RoC incorporation; FDI automatic/government route |
| LLP | Yes | Limited to contribution | Professional/consultancy services | RoC incorporation; FDI automatic route only, sectors with no FDI-linked conditions |
| Branch office | No — extension of parent | Parent company liable | Trading, consultancy, export-import | RBI/AD Category-I Bank approval |
| Liaison office | No — extension of parent | Parent company liable | Representation only, no revenue | RBI/AD Category-I Bank approval |
| Project office | No — extension of parent | Parent company liable | Execution of a specific contract | RBI/AD Category-I Bank approval (automatic in specified cases) |
Which Entity Structure Should a Foreign Company Choose?
Most foreign companies choose a private limited wholly owned subsidiary because it allows full ownership, limited liability, and unrestricted commercial activity in India, unlike branch, liaison or project offices which carry activity restrictions. The subsidiary route is also the structure Indian customers, banks and government departments deal with most readily.
The decision between a private limited company, an LLP, and a liaison/branch/project office depends on three questions: does the foreign parent want a separate Indian legal identity, does the business intend to generate India-sourced revenue, and is the sector open to 100% automatic-route FDI. A detailed comparison of Private Limited vs LLP vs Branch vs Liaison vs Project Office is available as a dedicated guide and should be read before finalising the structure, since the wrong choice at this stage is expensive to reverse.
Sector matters as much as structure. Defence, insurance, print media, multi-brand retail and a handful of other sectors carry either FDI caps below 100% or a requirement for prior government approval through the Government route, administered by the concerned administrative ministry in consultation with DPIIT. Reviewing the current sector cap before drafting the shareholding agreement avoids a restructuring exercise later.
How Does FDI Approval Work Under FEMA and the NDI Rules?
Foreign direct investment into an Indian company is governed by the Foreign Exchange Management Act, 1999 (FEMA 1999) and the FEMA (Non-Debt Instruments) Rules, 2019, which classify each sector into the automatic route or the government route. Under the automatic route, no prior approval is needed before the foreign investor remits funds and shares are allotted; under the government route, approval from the relevant administrative ministry is required first.
Once the foreign investment is approved (where required) and shares are allotted, the Indian company must report the transaction to the Reserve Bank of India (RBI) through Form FC-GPR, filed electronically on the RBI’s FIRMS portal, within 30 days of the date of allotment. The remittance itself must come through normal banking channels, typically routed through an Authorised Dealer Category-I Bank (AD Category-I Bank), which certifies the inflow before the company can file FC-GPR.
Delay in FC-GPR filing attracts a Late Submission Fee (LSF) computed under the RBI’s compounding framework, calculated as a function of the amount involved and the number of days of delay. Persistent non-reporting can escalate into a compounding application before the RBI, which is a corrective but time-consuming route.
Table 3: FDI reporting obligations for a foreign-owned Indian company
| Event | Form | Portal | Deadline | Filed by |
|---|---|---|---|---|
| Share allotment to non-resident investor | FC-GPR | FIRMS portal (RBI) | Within 30 days of allotment | Indian company, through AD Category-I Bank |
| Transfer of shares between resident and non-resident | FC-TRS | FIRMS portal (RBI) | Within 60 days of transfer/receipt of consideration | Resident transferor/transferee |
| Annual foreign liabilities and assets | FLA Return | RBI FLAIR system | By 15 July every year | Indian company with foreign investment |
| External Commercial Borrowing drawdown | ECB-2 return | RBI | Monthly, within 7 days of month-end | Borrowing Indian company |
What Documents Do Foreign Nationals and Foreign Companies Need?
Foreign individuals need a notarised and apostilled (or consularised) passport copy and address proof, while foreign corporate shareholders need a notarised and apostilled certificate of incorporation, board resolution and charter documents. Documents from countries that are signatories to the Hague Apostille Convention need apostille; documents from non-signatory countries need consularisation by the Indian embassy in that country.
For a foreign national proposing to be a director, a Director Identification Number (DIN) application and a Digital Signature Certificate (DSC) are prerequisites to signing the SPICe+ form electronically. Passport is treated as the primary identity document for foreign nationals in place of the PAN card required for resident directors, though foreign directors are advised to obtain an Indian Permanent Account Number (PAN) at the incorporation stage itself, since it is required for later tax and banking compliance.
For a foreign corporate shareholder, the subscriber sheet to the Memorandum of Association must be signed by an authorised signatory under a board resolution, and the resolution, along with the parent company’s certificate of incorporation and registered office proof, must be apostilled or consularised and translated into English where the original is in a foreign language.
Table 4: Core documents for foreign promoters incorporating an Indian company
| Document | Issued by | Apostille/notarisation required? | Validity |
|---|---|---|---|
| Passport copy (foreign individual director/shareholder) | Home country government | Yes, notarised and apostilled/consularised | Passport validity period |
| Address proof (foreign individual) | Utility provider/bank | Yes, notarised and apostilled/consularised | Typically not older than 2 months |
| Certificate of incorporation (foreign corporate shareholder) | Home country registrar | Yes, apostilled/consularised | No expiry, but recent copy preferred |
| Board resolution authorising investment and signatory | Foreign parent company board | Yes, apostilled/consularised | Specific to the transaction |
| No-objection/consent to act as director (Form DIR-2) | Proposed director | Notarised | One-time, at appointment |
What Are the Minimum Requirements for Directors, Shareholders and Capital?
An Indian private limited company needs a minimum of two directors, of whom at least one must be a person who has stayed in India for a total period of not less than 182 days during the financial year, and two shareholders, who may both be foreign nationals or entities. There is no statutory minimum paid-up capital requirement since the 2015 amendment to the Companies Act, 2013 removed the earlier ₹1,00,000 (roughly USD 1,136 at ₹88/USD) minimum for private companies.
A single foreign company can hold 100% of the shares of an Indian private limited company, with the second shareholder often being a nominee holding a nominal number of shares, or a group entity, since a private limited company requires two distinct shareholders. Foreign nationals can also be directors, but the resident director requirement means every foreign-owned Indian company needs at least one director who meets the 182-day residency test, whether an Indian national or a foreign national who resides in India.
Authorised and paid-up capital can be set at any figure the promoters choose commercially, since higher authorised capital only triggers higher MCA registration fees rather than any compliance burden by itself. A detailed breakdown of minimum capital, shareholders and directors for a foreign-owned Indian company is available as a separate guide.
What Is the Step-by-Step SPICe+ Incorporation Process?
Incorporation runs through the SPICe+ (Simplified Proforma for Incorporating a Company Electronically) web form on the MCA portal, covering name reservation, incorporation, PAN, TAN, EPFO, ESIC and bank account request in one filing. The process begins with obtaining a Digital Signature Certificate for each proposed director and subscriber, followed by Part A of SPICe+ for name approval and Part B for incorporation details.
Foreign directors sign the SPICe+ form and its linked documents using their DSC, which can be issued to a foreign national based on apostilled identity documents without requiring physical presence in India. Once the Registrar of Companies (RoC) approves the application, the company receives a Certificate of Incorporation bearing its Corporate Identification Number (CIN), along with PAN and TAN allotted simultaneously.
A full walkthrough of the SPICe+ incorporation process for foreign nationals, including the linked AGILE-PRO-S form for GST, EPFO, ESIC and bank account, professional tax and Shops & Establishment registration where applicable, is set out in a dedicated process guide.
How Much Does It Cost and How Long Does It Take?
Incorporating a foreign-owned Indian company typically takes 3 to 6 weeks from document collection to receipt of the Certificate of Incorporation, and costs between ₹40,000 and ₹1,50,000 (approximately USD 455 to USD 1,705 at ₹88/USD) in government fees and indicative professional fees combined, depending on authorised capital, apostille costs in the home country, and the complexity of the FDI structure.
The single largest variable in timeline is document readiness in the foreign jurisdiction — apostille processing times vary widely by country, from a few days to several weeks. The single largest variable in cost is authorised share capital, since MCA registration fees rise in slabs as authorised capital increases, alongside stamp duty, which varies by the state where the registered office is located.
A detailed cost breakdown, including government fees, professional fees for incorporation, and ongoing annual compliance costs, is available in a dedicated article on the cost of setting up a company in India for a foreign company.
What Are the Post-Incorporation Compliances?
Within 180 days of incorporation, the company must file Form INC-20A confirming commencement of business, after which it can start operations, open a current bank account, and begin FDI remittance and reporting. Failure to file INC-20A within the deadline attracts a penalty and can, if unresolved, lead to the RoC striking the company off the register.
Immediately after incorporation, the company must appoint a statutory auditor within 30 days, open a bank account in the company’s name, and, once foreign remittance is received against share allotment, file Form FC-GPR within 30 days on the FIRMS portal. GST registration, if the business is liable to register, professional tax registration in applicable states, and Shops & Establishment registration typically follow within the first few weeks of commercial activity.
Table 5: Post-incorporation compliance calendar for a foreign-owned Indian company
| Compliance | Deadline | Form/Portal |
|---|---|---|
| Appointment of first statutory auditor | Within 30 days of incorporation | Form ADT-1, MCA portal |
| Commencement of business declaration | Within 180 days of incorporation | Form INC-20A, MCA portal |
| Reporting of FDI inflow | Within 30 days of share allotment | Form FC-GPR, RBI FIRMS portal |
| Annual Return on Foreign Liabilities and Assets | By 15 July every year | RBI FLAIR system |
| Annual financial statements filing | Within 30 days of AGM | Form AOC-4, MCA portal |
| Annual return filing | Within 60 days of AGM | Form MGT-7/7A, MCA portal |
| Income tax return | On or before the statutory due date each assessment year | Income Tax e-filing portal |
Process Section: End-to-End Incorporation Steps
Table 6: Step-by-step company registration in India for foreigners
| Step | Action | Responsible party | Statutory deadline | Form/Portal | Typical TAT |
|---|---|---|---|---|---|
| 1 | Obtain Digital Signature Certificates for all directors/subscribers | Proposed directors/subscribers | Not applicable | Certifying authority portal | 1–3 working days |
| 2 | Reserve company name | Applicant | Name valid for 20 days from approval | SPICe+ Part A, MCA portal | 1–2 working days |
| 3 | Draft MOA, AOA and subscriber sheets, apostille foreign documents | Company secretary/legal counsel | Not applicable | Not applicable | 5–15 working days (apostille-dependent) |
| 4 | File SPICe+ Part B with linked AGILE-PRO-S | Applicant | Not applicable | SPICe+, MCA portal | 3–7 working days for RoC approval |
| 5 | Receive Certificate of Incorporation, PAN, TAN | RoC | Not applicable | MCA portal | Immediate on approval |
| 6 | Open company bank account | Company | Not applicable | AD Category-I Bank | 5–10 working days |
| 7 | Remit share capital from abroad | Foreign investor | Not applicable | AD Category-I Bank (banking channel) | Depends on investor’s bank |
| 8 | File INC-20A (commencement of business) | Company | Within 180 days of incorporation | MCA portal | Same day filing, subject to bank certificate |
| 9 | File FC-GPR for share allotment | Company | Within 30 days of allotment | RBI FIRMS portal | 5–10 working days for AD Bank certification |
Key Insights for Foreign Promoters
- A company can be fully incorporated without the foreign director or shareholder ever visiting India, provided the Digital Signature Certificate and apostille documentation chain is set up correctly in advance.
- The resident director requirement is calculated on a financial year basis (182 days), not a calendar year, which affects planning when the resident director is appointed mid-year.
- FC-GPR filing timelines run from the date of share allotment by the board, not from the date the funds were received, so companies should allot shares promptly after the remittance is credited and certified by the AD Category-I Bank.
- Sector classification under the Consolidated FDI Policy should be checked against the company’s actual proposed activity codes, not just its intended brand identity, since ancillary activities can trigger different FDI caps.
- Nominee shareholding arrangements to satisfy the two-shareholder rule must be genuine and documented, since undisclosed beneficial ownership structures can attract scrutiny under both company law and FEMA.
- Authorised capital should be set with headroom for near-term fundraising, since increasing authorised capital later requires a separate RoC filing and fee payment.
- GST registration is not automatic on incorporation; it must be applied for separately once the company crosses the threshold or opts for voluntary registration.
- A registered office address must be capable of receiving statutory notices; a virtual or shared office is acceptable only if the company can demonstrate control over the premises and produce a No Objection Certificate from the property owner.
Penalties and Cure
Table 7: Common defaults, exposure and regularisation for foreign-owned companies
| Default | Provision | Exposure | Regularisation route |
|---|---|---|---|
| Failure to file INC-20A within 180 days | Section 10A, Companies Act, 2013 | Penalty on the company and every officer in default; risk of RoC striking off | Late filing with additional fees; compounding if prosecuted |
| Delay in filing FC-GPR | FEMA (Non-Debt Instruments) Rules, 2019 | Late Submission Fee based on amount and delay period | File FC-GPR with LSF calculated on the FIRMS portal |
| No resident director appointed | Section 149(3), Companies Act, 2013 | Company deemed non-compliant; RoC action possible | Appoint a qualifying resident director immediately |
| Non-filing of annual returns/financial statements | Sections 92 and 137, Companies Act, 2013 | Additional fees per day of delay; disqualification of directors on repeated default | File pending returns with additional fees |
| Undisclosed sector cap breach | FEMA (Non-Debt Instruments) Rules, 2019 | Compounding by RBI; possible divestment direction | Compounding application to RBI |
Illustrative Example
A US-based software company, “Northgate Cloud Inc.”, decides to set up an Indian subsidiary in Bengaluru to hire an engineering team and sell software services to Indian clients. It incorporates “Northgate Cloud India Private Limited” as a wholly owned subsidiary, with Northgate Cloud Inc. holding 99% of shares and its US-based CFO holding one nominee share.
The company appoints two directors: the US CFO (foreign director, no residency requirement) and an Indian resident engineer who meets the 182-day test. Both sign SPICe+ using Digital Signature Certificates; the CFO’s passport and address proof are apostilled in the United States before submission. Incorporation completes in four weeks, largely because the apostille process took ten days.
After incorporation, Northgate Cloud Inc. remits USD 200,000 (approximately ₹1,76,00,000 at ₹88/USD) as share capital through its US bank to the Indian subsidiary’s account with an AD Category-I Bank in India. The Indian company allots shares within a week and files Form FC-GPR on the FIRMS portal within the 30-day window. It separately files INC-20A after opening its bank account and depositing the subscribed capital, well within the 180-day deadline. This is a hypothetical scenario for illustration only.
Frequently Asked Questions
Can a foreigner own 100% of a company in India?
Yes, a foreign individual or foreign company can own 100% of an Indian private limited company in most sectors under the automatic route of the Consolidated FDI Policy. Certain sectors, such as insurance, defence and multi-brand retail, carry caps below 100% or require government route approval before full ownership is permitted.
Do I need to visit India to register a company?
No, a foreign national or foreign company can complete company registration in India for foreigners entirely remotely. Digital Signature Certificates can be issued based on apostilled identity documents, and SPICe+ can be filed and approved without any party being physically present in India.
What is the difference between a wholly owned subsidiary and a branch office?
A wholly owned subsidiary is a separate Indian legal entity with limited liability, while a branch office is an extension of the foreign parent with no separate legal identity and the parent bearing full liability. Subsidiaries can undertake any lawful commercial activity; branch offices are restricted to RBI-permitted activities such as trading and consultancy.
How long does company registration take for a foreign national?
Company registration for a foreign national typically takes 3 to 6 weeks, depending mainly on how quickly apostille documentation is completed in the home country. Name approval and SPICe+ processing by the Registrar of Companies usually take under two weeks once documents are ready.
What happens if the foreign investor cannot find a resident director?
The company cannot be validly constituted without a director who satisfies the 182-day residency test, so promoters typically appoint a trusted local professional or an Indian employee as the resident director. This role can be limited in scope through a shareholders’ agreement while still satisfying the statutory requirement.
Is there a minimum capital requirement to start a company in India?
No, there is no statutory minimum paid-up capital for a private limited company in India since the 2015 amendment to the Companies Act, 2013. Promoters can set authorised and paid-up capital at any commercially reasonable figure.
Can a single foreign company hold both shares in an Indian company?
A private limited company requires a minimum of two shareholders, so a single foreign company typically holds the bulk of shares while a second shareholder, often a nominee or a group entity, holds a nominal shareholding. One-person companies are restricted to Indian resident individuals and are not available to foreign promoters.
How much foreign capital can I remit before incorporation is complete?
No foreign capital should be remitted before the Indian company is incorporated and has an active bank account, since share allotment and FC-GPR reporting require an existing Indian legal entity. Remittance is generally made after incorporation, once the company’s bank account is operational.
What is the cost difference between a private limited company and an LLP for foreign investors?
An LLP generally involves lower government incorporation fees than a private limited company, but it is available to foreign investors only in sectors with 100% automatic-route FDI and no performance-linked conditions. A private limited company carries a wider compliance framework but offers greater flexibility for future fundraising and sector eligibility.
Do foreign directors need a PAN card?
Foreign directors do not need a PAN card to be appointed as a director, since a passport can be used as identification on SPICe+. A PAN is, however, required later for tax compliance, banking, and signing certain financial documents, so most foreign directors obtain one soon after incorporation.
What is FC-GPR and why does it matter to foreign investors?
Form FC-GPR is the mandatory report filed on the RBI’s FIRMS portal within 30 days of allotting shares to a non-resident investor, confirming the foreign direct investment to the Reserve Bank of India. Missing this deadline triggers a Late Submission Fee and can complicate future fundraising or repatriation.
Can a foreign company convert its liaison office into a subsidiary later?
Yes, a foreign company can incorporate a new wholly owned subsidiary and transfer its liaison office’s business relationships and, in some cases, employees to the new entity, since a liaison office itself cannot be directly converted into a company. The process and its practical steps are covered in a dedicated guide on converting a liaison office into a wholly owned subsidiary.
Sources
- Companies Act, 2013, Ministry of Corporate Affairs — mca.gov.in
- Companies (Incorporation) Rules, 2014, Ministry of Corporate Affairs — mca.gov.in
- Foreign Exchange Management Act, 1999, Reserve Bank of India — rbi.org.in
- Foreign Exchange Management (Non-Debt Instruments) Rules, 2019, Department of Economic Affairs, Ministry of Finance — dea.gov.in
- Consolidated FDI Policy, Department for Promotion of Industry and Internal Trade — dpiit.gov.in
- Master Direction on Reporting under FEMA, Reserve Bank of India — rbi.org.in
- Income-tax Act, 1961, Income Tax Department — incometaxindia.gov.in
Disclaimer
This article is for general informational purposes only and does not constitute legal, tax, or financial advice. Laws and regulations referenced are subject to change, and readers should verify the current position with the relevant government authority or a qualified professional before acting on any information herein. CompanyIN accepts no liability for any loss arising from reliance on this content.
