Companies Act 2013 controls the Indian Subsidiary Company Registration process. As per Companies Act 2013, a subsidiary company can be defined as a company in which a foreign corporate body or parent body has minimum 50% of the entire share capital. Parent company has a grip over a subsidiary company.
Many foreign investors are willing to start their business in India as our nation provides tonnes of opportunities because of its fast-growing market. Any foreign national apart from the citizen of Pakistan and Bangladesh or an entity formed and operating outside India can invest in the Indian market and holds the power to make their own subsidiary company in India by obtaining shares pertaining to the matters of FDI policy of India. Before getting into the process of Indian Subsidiary Company Registration make sure that as a business entity you have at least one Indian Director who must be residing in India and one Foreign Director which is must for forming Indian Subsidiary Company. A subsidiary company is also called sister company and the company which has control over it is called parent company or holding company. Parent company holds the right to control the subsidiary company either partially or completely. Companies Act 2013 controls the Indian Subsidiary Company Registration process. As per Companies Act 2013, a subsidiary company can be defined as a company in which a foreign corporate body or parent body has minimum 50% of the entire share capital. Parent company has a grip over a subsidiary company. It is necessary for a subsidiary company to abide by the laws of the nation in which they are planning to establish or are already established. Hence, if a subsidiary company is established in India then it is crucial for the company to follow the law in force in India. An important thing to keep in mind is that a subsidiary company of a foreign parent company is regarded as a separate legal entity and subsidiary company is obliged to work as per the norms of the country where it is situated. Business personnel can register an Indian subsidiary company as a private limited company or a public limited company.
Indian government has approved 100% involvement of FDI in case of fast growing business industries; that is to say, FDI is permitted 100% without any foregoing approval. Although if you are a Partnership firm or LLP or Proprietorship then you may need a beforehand approval from government for FDI.
Directors and members of the company have limited liability. They are stringently limited to their company’s share. Limited liability trait protects the Director or member of the company in the time of any loss or financial distress bore by the company. Personal assets of Directors and members will not be at risk due to the loss suffered by the company.
Perpetual succession means no matter what happens to the members or directors of the company, the company will continue to exist. Insolvency, change in members, death, transfer etc will not have any effect on the existence of the company.
An Indian Subsidiary Company enjoys all the privileges of a Private Limited Company. The growth and expansion of business is easy because it raises capital from financial institutions, venture capitalist, and the investor.
A fully-owned subsidiary company in India has the benefit of borrowing funds from financial institutions in the form of loans.
Indian subsidiary company acts like a legal person; it can sue and can be sued.
Foreign subsidiary company works on an independent structure which gives them the authority to buy properties in India. These benefits play a crucial role in the progress of the company in its initial days.
The name should not resemble to any of the existing entities and shall not contain any offensive words detrimental to the interest of the society at large. Also, the name should necessary align with the objects of the company and must contain the word “OPC”.
A minimum number of 7 members are needed to run a Public Company, out of which 3 members should be the company’s directors. Relatives and Spouse can be directors or members. Maximum numbers of member can be unlimited and maximum director can be limited in Public Company.
To start a OPC, a minimum of Rs. 1 lacs is required as equity share capital.
The object of the Public Company shall be accordingly to business nature and as per the rule and act governed by Law. Any other object in its MOA shall be void.
Since the registration process is online, hence there is the requirement for Digital signatures of all the Directors and Shareholders.We provide seven DSCs in our package of Public Company Registration.
Once the name is finalized, the application shall be made in Form SPICE-Part A. The form is a replacement of earlier Form RUN and provides the option to apply for two names Prepare all requisite documents MOA, AOA, INC 9, INC 10, DIR 2 to be filed with the ROC. These must mention the main objective of incorporating a company.
Obtain an incorporation certificate with the corporate identification number (CIN). It usually takes 7-10 days to form a company..
The MOA is the constitution of the Company and defines various clauses mandatory to bring the company into existence such as Name clause, object clause, registered office clause, liability clause, subscription clause and capital clause.
The Ministry, after being satisfied, that the documents and details submitted in the application are correct and gives a true and fair view of the intentions of the applicant, shall grant the Certificate of Incorporation (COI) along with PAN and TAN.
Within 180 days of incorporation of the Company, a declaration, attested by the Director of the Company, shall be filed with ROC that each subscriber to the memorandum has consented to the share value taken by them.
Soon after the Public Limited comes to the existence, there shall be appointed before the first Annual General meeting of the Company, the statutory auditor who shall hold office till sixth AGM until and unless ratified or a resignation is served.
Like change in directors, change in address, increase in capital, etc. shall be done as on date basis.
