How to Register a Company in India: A Comprehensive Guide
Company registration in India is the first step to establish your presence in one of the fastest-growing economies of the world. The entire procedure is governed by the Companies Act, 2013 and outlines several compliance requirements and key steps.
Digital initiatives have streamlined the process; however, you still need to navigate through the procedural and legal complexities. In this guide, we attempt to familiarize you with the knowledge required to make appropriate decisions and successfully register a company in India.
Types of Companies in India
India offers several types of company registrations and choosing the right structure is crucial to avoid future issues. The structure must align with your organizational operational needs and objectives. Different types of company structures include:
- Wholly Owned Subsidiary
It is the most common and preferred option chosen by international companies expanding into India. This entity has a separate legal identity and can engage in different business activities. The parent company has 100% ownership and the subsidiary is registered as a private limited company under the Companies Act, 2013.
- Branch Office
Global companies set up branch offices to carry out specific activities. These entities are an extension of the parent company and often have limited functions like marketing activities or liaison work. RBI permission is needed setup a branch office.
- Liaison Office
It represents the interests of the parent company and is not allowed to engage in any commercial activities. Liaison offices are subject to specific rules and require RBI approval.
- Joint Venture
International firms can enter into a joint venture with Indian businesses. The two JV partners collaborate to form a new entity. The management structure and ownership vary based on the agreement.
- Project Office
It is setup for the execution of a specific project and is temporary. Setting up a project office requires RBI approval.
Step-by-Step Registration Process
- Choose the Structure: Based on your requirements and future business prospects, you can choose the appropriate company structure
- Obtain Director’s Identification Number (DIN): An application must be made to the Ministry of Corporate Affairs (MCA) to procure DIN for the proposed directors
- Procure Digital Signature Certificate (DSC): This is an important step to necessitate online filing of the registration documents by the proposed partners or directors in the business
- Tax Registration: Compliance for foreign companies India requires an application for Goods and Services Tax (GST) registration
- Choose Company Name: Applicants can choose the company name via the MCA website while complying with the regulatory guidelines
- Prepare Relevant Documents: All relevant documents outlining the internal working of the proposed company must be prepared in adherence to MCA guidelines
- File the SPICe+ Form: This comprehensive form includes different aspects, such as company name, incorporation, DIN, PAN, TAN, and EPFO registration; in addition to the SPICe+ form, e-MOA and eAOA must be linked
- MOA and AOA: These documents outline the company’s constitution and are often standardized but may be customized as required
- Get the Certificate of Incorporation: On paying the prescribed fees (based on authorized capital) and successful verification, the MCA issues the certificate of incorporation along with the Company Identification Number (CIN)
Documents Required
The company must provide the following documents for each director in the company:
Proof of Identity
Indian residents may submit their PAN cards (mandatory). Alternatively, they may submit driving license, voter ID card, or Aadhar card. Foreign nationals require a valid passport notarized in their home country. All foreign documents must be apostilled or legalized by the Indian Embassy.
Proof of Address
These include utility bills or recent bank statement. Indian residents may also provide rental agreements or lease deeds, as required. Foreign nationals must submit proof of apostilled or legalized address.
Photographs
All directors must submit recent photographs, which is taken within six months. The photos must be 3.5 cm X 3.5 cm with a white background.
Registered Office Address Proof
In case of a rented premise, lease deed or rental agreement is required along with a No Objection Certificate from the owner. If the premise is owned by a partner or director, ownership documents along with NOC from other partners or directors is required. For shared premises, an agreement with the service provider and NOC is needed.
Consent Forms and Declarations
Forms DIR -2 and INC – 9 are needed as these establish the directors’ legal standing. Companies incorporated with a share capital need Form INC – 20 to ensure compliance with minimum paid-up capital norms. To ensure legal compliance and maintain transparency, Form MBP -1 is needed.
Timelines and Costs Involved
Company Registration Timeline | |||
Stage | Activity | Estimated Timeline | Notes |
Pre-Registration | Obtain DSC | Up to five working days | All proposed directors |
Apply for DIN | One – two working days | ||
Name Reservation | One – two working days | Subject to availability and MCA approval | |
Registration | Filing SPICe+ form, eAOA, eMOA | Up to seven working days | Preparation and submission of all documents |
Issuance of Certificate of Incorporation | Two to five working days | Post verification by MCA | |
Post-Registration | Allotment of PAN and TAN | Automatic with IOC | |
Opening Bank Account | Three to four weeks | May take longer due to KYC and bank processes | |
GST Registration | Up to seven working days | After procuring PAN and bank account | |
Complex regulatory environments, lengthy processes, regional variations, and other factors are some common challenges faced by foreign companies. International business legal advisory firms like Greenvissage offer a suite of services that simplify and quicken this process. Our experts guide you at every stage during the registration process and offer customized solutions as per your specific requirements.
Whether you want to register your company in India or simplify market entry, Greenvissage is your partner. To know more about how we simplify your journey or discuss your specific needs, please connect at +91 8237857853 or drop us an email at info@greenvissage.com
Frequently Asked Questions
- Can a foreign company do business in India without registration?
No, all foreign companies must register with the Registrar of Companies under the Ministry of Corporate Affairs to conduct business in India.
- How many types of company structures are there?
The main types of company structures include wholly-owned subsidiaries, project offices, branch offices, liaison offices, and joint ventures.
- How to register a company in India?
Choose the type of company, reserve name, prepare and submit the documents, file application, pay the prescribed fees, and get the certificate of incorporation.
- How long does it take to register a company in India?
Official estimates suggest a few weeks but in reality, the process may be longer. Factors like documentation, name approval, and scrutiny may extend the timeline to months in some cases.
- Can foreign nationals register a company in India?
Yes, but they must comply with the FDI norms and may need to partner with an Indian resident depending on the sector.
- How much does it cost to register a company in India?
The cost varies and depends on several factors, such as company structure, authorized capital, and professional fees.
