Services we offer <=> Audit Assurance Services <=> Management Assurance Services <=> Corporate Financial and Legal Advisory <=> Taxation Entrepreneurial Services <=>Virtual CFO Services <=> Secretarial Compliance under The Companies Act, 2013 <=> Accounting Related Services <=> Transfer Pricing <=> NRI Services <=> Setting up Business in India by Foreign Companies

We at SGA , offer our professional expertise to foreign companies for setting up their businesses in India . We not only advise you about the foreign investment policy & procedures of the Government of India but also obtain all the necessary approvals required.

The services rendered in this area include the following :

  • Identifying investment opportunities and businesses/projects
  • Company information including all other registrations like income tax, sales tax, vat etc.
  • Assistance in all agreements & contracts
  • Obtaining all approvals & clearances from Reserve Bank of India & Foreign Investment Promotion Board (FIPB).
  • Setting up the organisation structure specially with respect to accounting systems etc.

We provide valuable inputs on the most tax friendly options while conceptualizing the business / investment strategy.

A foreign company planning to set up business operations in India has the following TWO options:

A1 .AS AN INDIAN COMPANY

A foreign company can commence operations in India by incorporating a company under the Companies Act, 2013 through:

  • Joint Ventures
  • Wholly Owned Subsidiaries
Foreign equity in such Indian companies can be up to 100% depending on the requirements of the investor, subject to equity caps in respect of the area of activities under the Foreign Direct Investment (FDI) policy. Details of the FDI policy, sectoral equity caps & procedures can be obtained on a specific request.
    Joint Venture With An Indian Partner
      Foreign Companies can set up their operations in India by forging strategic alliances with Indian partners. Joint Venture may entail the following advantages for a foreign investor:
      • Established distribution/ marketing set up of the Indian partner
      • Available financial resource of the Indian partners
      • Established contacts of the Indian partners which help smoothen the
      • process of setting up of operations
      Wholly Owned Subsidiary Company
        Foreign companies can also set up wholly owned subsidiary in sectors where 100% foreign direct investment is permitted under the FDI policy. For registration and incorporation, set of applications have to be filed with Registrar of Companies (ROC). Once a company has been duly registered and incorporated as an Indian company, it is subject to Indian laws and regulations as applicable to other domestic Indian companies. Contact US to know flow chart and steps involved in formation of a company.

A 1. AS A FOREIGN COMPANY

Foreign Companies can set up their operations in India through:

  • Liaison Office/Representative Office
  • Project Office
  • Branch Office
Such offices can undertake any permitted activities. Companies have to register themselves with Registrar of Companies (ROC) within 30 days of setting up a place of business in India.

2.a) Liaison Office/ Representative Office

Liaison office acts as a channel of communication between the principal place of business or head office and entities in India . Liaison office cannot undertake any commercial activity directly or indirectly and cannot, therefore, earn any income in India . Its role is limited to collecting information about possible market opportunities and providing information about the company and its products to prospective Indian customers. It can promote export/import from/to India and also facilitate technical/financial collaboration between parent company and companies in India . Approval for establishing a liaison office in India is granted by Reserve Bank of India (RBI).

2. b) Project Office

Foreign Companies planning to execute specific projects in India can set up temporary project/site offices in India . RBI has now granted general permission to foreign entities to establish Project Offices subject to specified conditions. Such offices cannot undertake or carry on any activity other than the activity relating and incidental to execution of the project. Project Offices may remit outside India the surplus of the project on its completion, general permission for which has been granted by the RBI.

2. c) Branch Office

Foreign companies engaged in manufacturing and trading activities abroad are allowed to set up Branch Offices in India for the following purposes: i. Export/Import of goods

ii. Rendering professional or consultancy services

iii. Carrying out research work, in which the parent company is engaged.

iv. Promoting technical or financial collaborations between Indian companies and parent or overseas group company.

v. Representing the parent company in India and acting as buying/selling agents in India .

vi. Rendering services in Information Technology and development of software in India .

vii. Rendering technical support to the products supplied by the parent/ group companies.

viii. Foreign airline/shipping company.

A branch office is not allowed to carry out manufacturing activities on its own but is permitted to subcontract these to an Indian manufacturer. Branch Offices established with the approval of RBI, may remit outside India profit of the branch, net of applicable Indian taxes and subject to RBI guidelines Permission for setting up branch offices is granted by the Reserve Bank of India (RBI).

After the entity is set-up in India :

We provide complete, online back office operations. From book-keeping to pay roll payroll processing, audit and assurance services and business enterprise services which includes all the statutory compliances required by a company in India. Opening Bank Account Assistance and signatory services for opening and operating Bank account in India with all major international banks are also provided.

Growing Successfully

Companies in India are required by law to place on public record their statutory annual accounts, which must be audited. These must comply with a range of disclosure requirements set out in the Companies Act, 2013. SGA, ensure that all disclosure requirements are met, and are authorised to carry out independent statutory audits. Our approach to audit concentrates effort where it's most needed, keeping costs to a minimum and providing a useful management tool. Our advice isn't just an annual event but clients rely on our experience all year round. As your profits grow, we advise on corporate tax planning and compliance. Whenever cross border / intra group transactions arise, the difficult issue of transfer pricing is never far behind. We can help you to determine fair prices and ensure that the documentation required by the tax authorities is in place. Financial and tax planning for business owners and key employees is just as important to maximise your financial growth and minimise tax bills.

The Advantages

Our service list allows you to pick and choose to specifically match your needs. Our outsourcing capability allows you to achieve India fiscal compliance cost-effectively. We look after the peripheral issues leaving your company time to concentrate on what's really important: succeeding in the India .

Company Formation in India

Companies Act

Companies incorporated or registered in India are governed by the Companies Act 2013.

Shareholders and Directors

A. One local resident director is mandatory to incorporate a company in India .
B. Foreign nationals can incorporate company in India and hold foreign equity to the extent of 100% which is dependent upon sector in which company will operate and is subject to approval from either Reserve Bank of India(RBI) or Foreign Investment Promotion Board (FIPB).

Memorandum & Articles of Association

The memorandum and articles are the primary legal document of a company. Memorandum contains the name of the company, authorized share capital, initial members and object clause. Articles are a set of internal regulations that govern the day to day operations of the company. Both memorandum and articles have to be filed with Registrar of companies at the time of incorporation or if there are any changes thereafter. At least two subscribers (shareholder) are required in the memorandum and each of the subscriber must subscribe to at least one share in the company.

Share Capital

Shares must be expressed in a fixed amount. Shares to be subscribed must be expressed in Indian rupees.

Annual Meetings

An annual general meeting (AGM) must be held once in every financial year and not more than 6 months after the end of financial year. However, a company can hold its first AGM until 18 months from its incorporation.

Public Filings

The names and personal particulars of the directors and secretary, register of charges, share capital, registered office address etc. must be filed with the Companies Registry.

Accounts & Auditors

Every company is required to appoint an auditor each year at its AGM. An auditor must be qualified by virtue of the Institute of Chartered Accountants of India Act 1949 and completely independent of the company. Audited accounts of the company serve as tool for various stakeholders like creditors, bankers, investors and revenue authorities.

How to form a Company in India

Broad Steps to be taken for incorporating a private limited company:-

    Identify the Local and Foreign Directors

    Obtain Digital Signature Certificates of all the Directors

    Obtain DIN (Director's Identification Number) for all the Directors

    Identify the Name for the Company

    Ensure that the name does not resemble the name of any other company already registered.

    Apply to the concerned ROC to ascertain the availability of name. along with the necessary filing fees.

    Drafting of the Memorandum and Articles of Association.

    Get the Memorandum and Articles signed by the subsribers (atleast two subscribers) in their own hand.

    Get the following forms duly filled up and signed:-
1. Consent of the Directos - Form No DIR 2
2. Affidavit of Subscribers - Form No INC 9
3. Verification of Signatures of Subscribers - Form No INC 10
4. Power of Attorney from the subscribers in favor of a person for making necessary corrections on their behalf in the documents and papers filed for registration.
      Obtain the Final Certificate of Incorporation from ROC.