Doing Business in India

November 2018
Background
The Government of India took the task of transforming India into a manufacturing power through the ‘Make in India’
campaign launched on September 25, 2014. A national program designed to facilitate investment, foster innovation,
enhance skill development, protect intellectual property and build best-in-class manufacturing infrastructure. While
several initiatives are being undertaken to provide adequate physical and social infrastructure such as industrial
corridors, cluster, zones, etc. it is encouraging to note that the Government of India (GoI) has embarked on ambitious
reforms focused on improving India’s performance in the World Bank’s Doing Business rankings. India is ranked 77
among 190 economies in the ease of doing business, according to the latest World Bank annual ratings.

Investment climate in India has also improved considerably since the opening up of the economy in 1991. With an aim
to attract and promote FDI, GoI has put in place a policy framework on FDI, which is transparent, predictable and easily
comprehensible.

This toolkit covers information on Setting up Business in India such as types of permitted business establishments,
commencing business in India by a foreign investor, foreign company incorporation process – LO/ BO/ PO, business
registration process and Central & State level compliances.

Moreover, it covers the FDI related information across sectors such as how much FDI is permitted under different
sectors via automatic/ Government route. The toolkit further covers the institutional and regulatory framework such as
routing FDI in India, concerned administrative Ministries/ Departments, applicable regulatory framework for business
establishments, governing bodies for business establishments and winding-up business.
Contents
Abbreviations • Related Compliances
Introduction to the toolkit • Company wind-up

1. Setting up Business in India 4. Annexures

• Types of permitted business establishment • Annexure I: List of Documents required for
• Foreign company incorporation process- DSC, DIN
LO/BO/PO & foreign bank branch • Annexure II: List of Documents required for
• Registration process- OPC, Pvt. Ltd., LLP, FLLP OPC, Private Limited
• Pre- commissioning and post commissioning • Annexure III: List of Documents required for
of operations LLP, BIS
• Annexure IV: List of Documents required for
FIFP
2. Foreign Direct Investment in India
• Permitted sectors • Annexure V: List of Documents required for
Foreign Bank Branch
• Prohibited Sectors
• Annexure VI: Investment Options for
• Eligible Investors & Instruments Foreigners
• Compliances/Requirements • Annexure VII: Contact

3. Institutional & Regulatory framework

• Regulatory set-up
• Institutional set-up
 Abbreviations
AD Authorized Dealer DSC Digital Signature Certificate
AF Angel Fund ECB External Commercial Borrowing
ADR American Depository Receipts FCCB Foreign Currency Convertible Bond
AIF Alternative Investment Fund FCNR (B) Foreign Currency Non-Resident Account
Act or the Act Companies Act, 2013 FDI Foreign Direct Investment
AD Authorized Dealer FEMA Foreign Exchange Management Act
AoA Articles of Association FPI Foreign Portfolio Investor
BO Branch Office FIFP Foreign Investment Facilitation Portal
CA Chartered Accountant FVCI Foreign Venture Capital Investor
CCEA Cabinet Committee on Economic Affairs FII Foreign Institutional Investor
CCS Cabinet Committee on Security GDR Global Depository Receipts
CoI Certificate of Incorporation GoI Government of India
CRC Central Registration Center GST Goods and Service Tax
CS Company Secretary InvITs Infrastructure Investment Trusts
DDT Dividend Distribution Tax JV Joint Venture
DEA Department of Economic Affairs KYC Know Your Customer
DIPP Department of Industrial Policy & Promotion LLP Limited Liability Partnership
DR Depository Receipt LO Liaison Office
DSIM Department of Statistics and Information Max Maximum
Management
DGIT Director General of Income Tax
DGP Director General of Police
DIN Director Identification Number
Abbreviations
Min Minimum SEBI Securities and Exchange Board of India
MoA Memorandum of Association SEZ Special Economic Zone
MoU Memorandum of Understanding SME Small and Medium-sized Enterprise
MCA Ministry of Corporate Affairs SMS Short Message Service
MSME Micro, Small and Medium Enterprise TAN Tax deduction account number
NBFC Non-Banking Financial Companies TDR Transferable Development Rights
NFRA National Financial Reporting Authority TDS Tax Deducted at Source
NGO Non Government Organization UTI Unit Trust of India
NOC No Objection Certificate VC Venture Capital
NPO Non- profit organization WOS Wholly-owned Subsidiary
NRE Non-Resident Entity
NRE Account Non-Resident (External) Rupee Account
NRI Non-Resident Indian
NRO Account Non-Resident Ordinary Rupee Account
PAN Permanent Account Number
PIB Press Information Bureau
PIO Person of Indian Origin
PO Project Office
PSU Public Sector Undertaking
PGBP Profit and Gains on Business and Professions
RBI Reserve Bank of India
REIT Real Estate Investment Trust
RoC Registrar of Companies
1
Setting up Business in India
Types of permitted business establishments
Commencing business in India by foreign Investor
Foreign company incorporation process- LO/BO/PO
Business Registration process
Central level process/compliances
State level process/compliances
 Setting up Business in India
Types of permitted business establishments
One Person Private Ltd Public Ltd
Company Company Section 8 Company
Company

• The Companies Act 2013 A private company is a company A public company is a company • A company established for
enables formulation of new which has the following which has the following promoting commerce, art,
type of entity i.e. One Person characteristics: characteristics: science, sports, education,
Company (OPC). An OPC means research, social welfare,
a company with only 1 person • Shareholders right to transfer • Shareholders right to transfer religion, charity, protection of
as a member shares is restricted shares is not restricted environment or any such other
• Shareholder can make only 1 object', provided the profits, if
nominee, who shall become a • Minimum number of 2 • Minimum 7 shareholders any, or other income is applied
shareholder incase of death / members in company for promoting only the objects
incapacity of original • Publishing a prospectus of the company and no
stakeholder • Number of shareholders is become mandatory incase of dividend is paid to its members
limited to 200 public issue
• Only a natural person who is • Section 8 company enjoys all
Indian Citizen &ROI shall be • An invitation to the public to • A company which is a privileges and shall be
eligible to act as member & subscribe to any shares or subsidiary of a public company, subjected to all the obligations
nominee in OPC debentures or any type of shall be deemed to be a public of limited company
security is prohibited company even where such
• A person can be nominee in subsidiary continues to be • 1 Resident director mandatory
only 1 OPC • 1 Resident director mandatory private company in AoA

• 1 Resident director mandatory • 1 Resident director mandatory

(Min stay of 182 days)

Note - Resident Director : sec 149 (3) – Every company should have at least one director who has stayed in India for a total period of not less than 182 days in the financial year (wef.
7 May 2018)
 Setting up Business in India
Types of permitted business establishments
Limited Liability Foreign Company
Sole Proprietorship Partnership firm
Partnership

• Sole proprietorship is a • Partnership firms are • LLP is an alternative corporate • Incorporated outside but
form of business in which created by drafting a business entity that provides the having a place of business
one person owns all the partnership deed among benefits of limited liability of a in India (section 2(42))
assets of the business, in the partners. The company but allows its members
contrast to partnership partnership deed is the flexibility of organizing their • Liaison office - To
or corporations registered to make a firm internal management on the basis represent parent company
of a mutually-arrived agreement, as in India
• No legal formalities are • Partnership firms in India is the case in a partnership firm
required to create a sole are governed by the • Branch office- To
proprietorship other than Indian Partnership Act, • Introduced in India by way of undertake activities such
an appropriate licensing 1932 Limited Liability Partnership Act, as Export, Import of
to conduct a business 2008. LLP is a separate legal entity goods; research,
and registration of • Maximum no. of partners consultancy etc.
business name if it in a partnership firm can • Min 2 partners required
differs from that sole be 20 • Project Office- Activities as
proprietorship • LLP shall have 2 designated per contract to execute
• The Profit & Loss are partners who are individuals and at project
• The owner reports shared in manner as least one of them shall in be
income/ loss from this agreed in the partnership Resident Partner • As per company law, a
business along with deed resident having PAN to be
personal income tax • Individual/ Body corporate may be appointed for receiving
return • Min 2 partners required a partner in LLP notices in India for foreign
company

Note - As per the section 7 (1) resident DP means a person who has stayed in India for at least 182 days during the immediately preceding 1 year.
 Setting up business in India
Comparative analysis of different business establishments in India
Private Company vis-à-vis Public Company vis-à-vis OPC vis-à-vis LLP

Particulars Private Public OPC LLP

Min Members 2 7 1 2 partners

Max Members 200 Unlimited 1 No Limit

Min Directors 2 3 1 2 Designated Partners

Max Directors 15* 15* 15* NA

Resident Director 1 Mandatory 1 Mandatory 1 Mandatory 1 Designated Partner

Transfer of Ownership can be Ownership can Ownership can be Ownership can

ownership transferred be transferred transferred to nominee in be transferred
the event of death of owner

Subscription of Public subscription Public subscription Public subscription Public subscription

shares not allowed allowed not allowed not allowed

Issue of Prospectus Not Mandatory Mandatory Not Mandatory Not Mandatory

Managerial No limit for Shareholder approval is NA Remuneration is based

Remuneration managerial personnel required, If remuneration on LLP agreement
payable is above limits
Note
Resident Director : sec 149(3) – Every company should have at least one director who has stayed in India for a total period of not less than 182 days in the Financial Year.
*Company may appoint more than fifteen directors after passing a special resolution, further provided that such class or classes of companies as may be prescribed, shall have at
least one woman director (Rule 3 of The Companies (Appointment and Qualification of directors) Rules, 2014)
Setting up business in India
Comparative analysis of different categories of company (contd.)

Private Company vis-à-vis Public Company vis-à-vis OPC vis-à-vis LLP

Particulars Private Public OPC LLP

Commencement of Declaration to be filed Declaration to be filed Declaration to be filed Immediately after
Business/ prior to commencement prior to commencement prior to commencement obtaining certificate
Operations of incorporation

Pvt Co is a separate legal Public Co is a separate legal OPC is a separate legal LLP is a separate legal
Legal Status entity registered under entity registered under entity registered under entity registered under
Companies Act, 2013. Companies Act, 2013. Companies Act, 2013. LLP Act, 2008. The
The Directors The Directors The Directors Designated partners of
are liable are liable are liable LLP are liable for
for defaults made under for defaults made under for defaults made under contraventions under the
the act the act the act act

Governing Act/ Law Companies Act, 2013 Companies Act, 2013 Companies Act, 2013 LLP Act, 2008

Annual Statutory Annual statement of Annual statement of Annual statement of Annual statement of
Filings accounts & accounts & accounts & solvency &
annual return with ROC annual return with ROC annual return with ROC annual return with ROC

Annual Filings & IT return to be filed.

filed IT return to be filed.
filed IT
IT return
return to
to be
be filed
filed . ITITreturn
returntotobebefiled.
filed and
Audit Audit mandatory Audit mandatory Audit mandatory. Audit
auditmandatory
mandatoryinincase case
turnover
turnover
exceeds
exceedsINR 40
lakhs orINR
contribution
40 lakhs
exceeds INR 25 lakhs
Setting up business in India
Commencing business in India by foreign Investor
Foreign Investor can commence business in India as:

For carrying out EXIM, Research For carrying out manufacturing/services and other related business
and project execution operations operations

Foreign OR Indian OR Limited

Liability
Company** Company* Partnership
To represent Subject to provisions of
JV / Wholly
parent company in Joint Venture LLP Act, 2008
Liaison Owned Subsidiary
India LLP
Office as (i) Private
FDI permitted under
To undertake Limited or (ii)
automatic route in LLPs
activities such as Public Limited
operating in
Export, Import of Company, s.t.
Branch goods; research, Companies Act,
sectors/activities where
Office consultancy etc. 2013
100% FDI is allowed,
through the automatic
Wholly route and there are no
Activities as per
Owned FDI-linked performance
Project contract to
execute project Subsidiary conditions***
Office

*Incorporate company in India s.t. sectoral caps and requisite approvals

**RBI guidelines regarding establishment of LO/BO/PO: [Link] As per company law, a resident
having PAN to be appointed for receiving notices in India for foreign company
***For detailed definitions, clarifications/ exceptions, please refer to Consolidated FDI Policy, effective from August 28,2017, Amendment to FDI policy in Jan 2018
Setting up business in India
As a foreign company incorporation - LO/BO/PO

Branch Office (BO) Liaison Office (LO) Project Office (PO)

Permitted BO can be set up by foreign companies. The LO can not undertake any PO can be set up to execute
activities permitted activities include export/import of commercial activity and acts as a specific projects in India and
goods; rendering professional or consultancy channel of communication between cannot undertake or carry on
services; carrying out research work, in which the principal place of business or any activity other than the
the parent company is engaged; promoting head office and entities in India. Its activity relating and
technical or financial collaborations between role is limited to collecting incidental to execution of the
Indian companies and parent or overseas group information about possible market project
company; representing the parent company in opportunities and providing
Foreign Company

India and acting as buying/selling agents in information about the company and
India; rendering services in information its products to prospective Indian
technology and development of software in customers. It can promote
India; rendering technical support to the export/import from/to India and
products supplied by the parent/ group also facilitate technical/financial
companies and foreign airline/shipping collaboration between parent
company company and companies in India. It
cannot earn any income in India
There is a general permission to non-resident
companies for establishing BO in the Special
Economic Zones (SEZs) to undertake
manufacturing and service activities subject to:
• BOs are functioning in those sectors where
100% FDI is permitted
• BOs comply with Chapter XXII of the
Companies Act, 2013
• BOs function on a stand-alone basis
Setting up business in India
As a foreign company incorporation - LO/BO/PO
Branch Office (BO) Liaison Office (LO) Project Office (PO)

Eligibility Profit making track record during Profit making track record during NA
the immediately preceding five the immediately preceding three
financial years in the home country financial years in the home
and net worth of not less than USD country and net worth of not less
100,000 or its equivalent than USD 50,000 or its equivalent.
Foreign Company

Validity NA Generally for 3 years As per the tenure of the

*except in the case of NBFCs and project
those entities engaged in
construction and development
sectors, for whom the validity
period is two years only

Remittance Permitted to remit profits net of Intermittent remittances by NA

applicable taxes and on submission companies pending winding up
of requisite documents permitted s.t. satisfaction of AD
Category 1 bank

Note - An applicant that is not financially sound and is a subsidiary of another company may submit a Letter of Comfort (LOC) (Annex A) from its parent/ group company, subject to
the condition that the parent/ group company satisfies the prescribed criteria for net worth and profit
Setting up business in India
Foreign company incorporation process- LO/BO/PO
Exception: RBI approval required in following cases:
(i) applicant is a citizen of or is registered/incorporated in Pakistan ;
(ii) applicant is a citizen of or is registered/incorporated in Bangladesh, Sri Lanka, Afghanistan, Iran, China, Hong Kong or
Macau and the application is for opening a BO/LO/PO in Jammu and Kashmir, North East region and Andaman and
Nicobar Islands;
(iii) principal business of the applicant falls in the four sectors namely Defence, Telecom, Private Security and Information
and Broadcasting (s.t. certain relaxations) and
(iv) applicant is a Non-Government Organization (NGO), a Non-Profit Organization, or a Body/ Agency/ Department of a
foreign government.
Foreign Company

1. Application (Form FNC) to a AD Category 1 bank Form FNC along with supporting documents

2. Post evaluation and before approval- bank forwards a copy of the Form FNC along with the details of the approval
proposed to be granted by it to RBI for allotment of Unique Identification Number (UIN) to each BO/LO

Exceptions- Foreign banks and insurance companies do not require UIN from forex department RBI

3. After receipt of the UIN from the Reserve Bank, the AD Category-I bank issues the approval letter to the non-resident
entity for establishing BO/LO in India

4. inform designated AD Category I bank as to the date on which the BO/LO/PO has been set up.- bank in turn shall inform
RBI

Note : In case the BO/LO/PO for which approval has been granted is not opened within 6 months from the date of the
approval letter, the approval shall lapse. In cases where the non-resident entity is not able to open the office within the
stipulated time frame due to reasons beyond its control, the AD Category-I bank may consider granting extension of time for
a further period of 6 months for setting up the office. Any further extension of time shall require the prior approval of RBI
Setting up business in India
Foreign company incorporation process- LO/BO/PO
5. Applications for establishing a BO/LO in India by foreign banks and insurance companies will be directly received and
examined by the Department of Banking Regulation, RBI, Central Office and IRDA, respectively. No UIN for such
representative offices is required from the Foreign Exchange Department, Reserve Bank of India.

Note : There is a general permission to non-resident companies to establish POs in India, provided:
i. they have secured a contract from an Indian company to execute a project in India
ii. project must have secured the necessary regulatory clearances;
iii. Project is funded directly by inward remittance from abroad; or the project is funded by a bilateral or multilateral
Foreign Company

International Financing Agency, or a company or entity in India awarding the contract has been granted Term Loan by a
Public Financial Institution or a bank in India for the project

6. March 31 – submit annual activity certificate (AAC) to AD Category 1 Bank

Other Registrations
Applicants from Bangladesh, Sri Lanka, Afghanistan, Iran, China, Hong Kong, Macau or Pakistan desirous of opening BO/LO/PO
in India shall have to register with the State Police authorities

Registration with RoC if reqd. as per companies Act, 2013

BO/LO to obtain PAN from Income Tax authorities

NOTE : Branches of Foreign Banks

Foreign banks do not require separate approval under FEMA, for opening branch office, however they require necessary
approval under the provisions of the Banking Regulation Act, 1949, from Department of Banking Regulation, Reserve Bank.
 Setting up business in India
Foreign company incorporation process- LO/BO/PO

Foreign company after being registered with the RBI ought to get itself registered with the Ministry of Corporate Affairs
(MCA), for it to be registered as an establishment of a foreign company in India
7. Necessary documents shall be filled with the Registrar of Companies (RoC) within 30 days of establishment

Note : As per Section 380 of Companies Act, following documents shall be filled :
• Certified copy of the charter, statutes or memorandum and articles, of the company or other instrument constituting or
defining the constitution of the company and, if the instrument is not in the English language, a certified translation
thereof in the English language;
Foreign Company

• Full address of the registered or principal office of the company

• List of the directors and secretary of the company containing such particulars as prescribed under Rule 3.
• Name and address or the names and addresses of one or more persons resident in India authorised to accept on behalf of
the company service of process and any notices or other documents required to be served on the company
• Full address of the office of the company in India which is deemed to be its principal place of business in India
• Particulars of opening and closing of a place of business in India on earlier occasion or occasions
• Declaration that none of the directors of the company or the authorized representative in India has ever been convicted
or debarred from formation of companies and management in India or abroad.
• Other Documents as may be prescribed.

8. Rule 3(3) of the Companies (Registration of Foreign Companies) Rules, 2014 requires application in Form FC-1 to be
supported with an attested copy of approval from the Reserve Bank of India under Foreign Exchange Management Act and
the rules and regulations thereunder or a declaration from the authorised representative of such Foreign Company that no
such approval is required.

Note: For more information on Foreign companies regulations as per companies act, refer chapter XXII - [Link]
(Sec 379 –sec 393)
 Setting up business in India
Foreign company incorporation process- Setting up Foreign Bank
branch in India
Licensing of Licensing of New Banks in the Private Sector & “On Tap” licensing for new banks in Private sector

• Eligible Promoters:
i. Individuals / professionals who are residents [as defined in FEMA Regulations, as amended from time to time]
having 10 years of experience in banking and finance at a senior level.
ii. Entities / groups in the private sector that are ‘owned and controlled by residents’ [as defined in FEMA
Regulations, as amended from time to time] and have a successful track record for at least 10 years, provided
that if such entity / group has total assets of ` 50 billion or more, the non-financial business of the group does
not account for 40 per cent or more in terms of total assets / in terms of gross income
iii. Existing non-banking financial companies (NBFCs), that are ‘controlled by residents’ [as defined in FEMA
Foreign Bank

Regulations, as amended from time to time], and that have a successful track record for at least 10 years will be
eligible to convert into a bank or promote a new bank
• Fit & Proper criteria : Entities / groups should have a past record of sound credentials and integrity, be financially sound
with a successful track record of 10 years. For this purpose, RBI may seek feedback from other regulators and
enforcement and investigative agencies.

NOHFC: The NOFHC shall be wholly owned by the Promoter / Promoter Group. The initial minimum paid-up voting equity
capital for a bank shall be `5 billion. The NOFHC shall initially hold a minimum of 40 per cent of the paid-up voting equity
capital of the bank which shall be locked in for a period of five years. At least 50% of the Directors of the NOFHC should be
independent directors.

Foreign Shareholding in Bank : The Regulatory framework : The foreign bank branches shall be governed by Banking Regulation Act,
aggregate non-resident 1949, Reserve Bank of India Act, 1934, Foreign Exchange Management Act, 1999, Payment and
shareholding in the new bank shall Settlement Systems Act, 2007, Credit Information Companies (Regulation) Act, 2005, Deposit
not exceed 49% in first 5 years . Insurance and Credit Guarantee Corporation Act, 1961, other relevant Statutes and the Directives,
issued by RBI , SEBI and other regulators

For more information on Guidelines for Licensing of New Banks in the Private Sector act, refer TO RBI guideline
[Link] , &
[Link]
 Setting up business in India
Foreign company incorporation process- Setting up Foreign Bank
branch in India
Licensing of Licensing of New Banks in the Private Sector & “On Tap” licensing for new banks in Private sector

Application process
• Applications shall be submitted in the prescribed form (Form III) as per Rule 11 of the Banking Regulation (Companies)
Rules, 1949. The applicants should furnish the requisite information as per the Annex II.
• Applications for setting up banks in the private shall be made to Chief General Manager, Department of Banking
Regulation, Reserve Bank of India, Central Office, 13th Floor, Central Office Building, Shahid Bhagat Singh Road, Mumbai-
400001
• The licensing window will be open on-tap. As such, applications in the prescribed form along with requisite information
could be submitted to RBI at any point of time, as desired by the applicant
Foreign Bank

Procedure by RBI
• Applications will be screened by RBI to assess the eligibility of the applicants vis-à-vis the criteria laid down in the
guidelines
• RBI may apply additional criteria to determine the suitability of applications, in addition to the ‘fit and proper’ criteria
prescribed at paragraph 2 (B).
• The applications will be referred to a Standing External Advisory Committee (SEAC) to be set up by RBI. The SEAC will set
up its own procedures for screening the applications. SEAC has right to call for more information as well as have
discussions with any applicant/s and seek clarification and submit its recommendations to RBI for consideration
• The Internal Screening Committee (ISC), consisting of the Governor and the Deputy Governors will examine all the
applications and then submit its recommendations to the Committee of the Central Board (CCB) of RBI for the final
decision to issue in-principle approval.
• The validity of the in-principle approval issued by RBI will be 18 months from the date of granting in-principle approval
and would thereafter lapse automatically. Therefore, the bank will have to obtain the licence within a period of 18 months
of granting the in-principle approval.

For more information on Guidelines for Licensing of New Banks in the Private Sector act, refer TO RBI guideline 18
[Link] , &
[Link]
 Setting up business in India
Incorporation of Company: Overview
Incorporation of Company
Check availability of name / registered trademark for
1
1 RUN 2 DSC incorporation of company
Reserve name of the proposed company through online service
2 RUN on MCA website. Name can also be applied through SPICe.

3 Filing for Incorporation Obtain Digital Signature Certificate (DSC) for proposed
through form Spice 3 Directors of the Company. DIN for proposed Directors can
only be applied for through form SPICe.
Form INC 32 (SPICe) are to be duly filled and submitted to RoC
Incorporati 4 for incorporation of company. PAN and TAN are shall be auto
Allotment Apply for
Business on of new generated based on details filed in the SPICe form
of DIN PAN/ TAN
Types - company
Private, Filing of electronic Memorandum of Association (eMoA - INC
Public , 33) & Articles of Association (eAoA- INC 34) in SPICe . For
5
Producer foreign subscribers physical MoA and AoA to be executed and
Company attached
, Nidhi 4 eMOA 5 eAOA
Company
6 SPICe uploaded and fee payment is confirmed by MCA

RoC verifies/scrutinises all the documents and forms and may

Certificate/ Notarization 7 suggest few changes to be made in the attachments or form
Spice upload & Incorporation, Obtain CIN, itself. One needs to make necessary changes accordingly
6 7 8
fee payment Notarization PAN , TAN
Obtain certificate of incorporation. CIN, PAN &TAN numbers
8
are allotted at the time of registration
9 Declaration of commencement A company having share capital is required to file a declaration of receipt
of business 9 of subscription amount and verification of registered office within 180 days
of incorporation and prior to commencement of business.

State Registration Process as applicable Note : Notarization & Apostilling / legalization of documents mandatory in case of foreign
subscribers / Directors
Setting up business in India
Incorporation as an LLP: Overview
Incorporation of Limited Liability Partnership (LLP) and
Foreign LLP (FLLP) Obtain class 2 or class 3 Digital Signature
1
Certificate (DSC) for designated partners of LLP
1 DSC For a quick search on already existing names of LLP a facility is
provided by MCA to check list of similar/closely resembling
2 names of existing companies/LLPs. Trademark is also to be
Availability check for LLP
2 checked
name
Filing the proposed name of LLP for approval from the
Reservation and approval 3 Registrar of Companies through RUN – LLP and can also be
3 of name for LLP through done through FiLLiP
Business RUN - LLP
Types - FiLLiP is to be duly filled and submitted to RoC for
LLP Filing for incorporation of incorporation of LLP. For Foreign LLP (FLLP) Form 27 is to be
4 4
LLP/ FLLP/ DPIN filed in and digitally signed by FLLP (DPIN must be obtained
through FiLLiP.
Form 3 (Information with regard to LLP agreement and
5 LLP Agreement 5 changes, if any made therein) to be filled within 30days of
incorporation of LLP.

State Registration Process as applicable

Setting up business in India
Other registration requisite as applicable

Tentative Timelines

Register for Profession tax. It is tax levied by state government and tax rate Time – 12 days
varies from state to state Form- N/A
Other
registrations Register with Employees' Provident Fund Organization for registration of Time – 6- 12 days approx.
required (as establishment for allotment of PF Code number. Guide to application Form- Link for online registration
applicable) Register with ESIC (medical insurance) Time – 12 days
while setting Form- Link for online registration
up
Company/ Register under Shops and Establishment Act Time – 12 -15 days
LLP in India Form- Form F & B

Filing for Government Approval before FIFP for FDI approval. for Foreigners Time – 8 weeks without security
and NRI's. A detailed guide to filing for application is available at the link. List clearance), 10 weeks with
of documents required to required at the time of filing application is security clearance .
available at Annexure I Form- Link for online application
Setting up business in India
Central level process/compliances
Obtain Director Digital Signature Approval for
Identification Certificate (DSC) for proposed Company/
Number (DIN) proposed Directors LLP Name
DIN is a unique identification DSC can be obtained by The applicant must file e form RUN with
Setting up legal existence of the entity

number issued by the Ministry of approaching Certifying Authorities the Central Registration Center (CRC),
Corporate Affairs (MCA), for a (CAs) with original supporting India for approval of name.
designated partner of an existing documents and self-attested
LLP or a person intending to copies For LLP name search facility (of existing
become a director of a company. companies / LLPs) is available on MCA
A licensed Certifying Authority portal. The system will provide the list
DIN can be obtained by filing (CA) issues the digital signature. of similar/closely resembling names of
application Form DIR-3 online Certifying Authority (CA) means a existing companies/LLPs based on the
All designated partners of the person who has been granted a search criteria filled up. For registration
proposed LLP shall obtain “Designated license to issue a digital signature of name RUN LLP to be filed.
Partner Identification Number (DPIN) / certificate under Section 24 of the
Director Identification Number Indian IT-Act 2000 The name reserved for company shall
(DPIN)” through FiLLiP & proposed be available for adoption of name for a
company through SPICe (if DIN is not period of 20 days. In case of laps of the
available) said period, fresh approval needs to be
taken from RUN or RUN-LLP is to be
Note – Application for DIN (for a taken. For LLP name is reserved for 3
person proposed to be appointed as a months. Incase of change of name of
Director of existing company or company, the reserved name is
Designated Partner of existing LLP) to available for 60 days.
be filed in Form DIR-3. Change in
particulars to be intimated in Form
DIR-6 within 30 days
Setting up business in India
Central level process/compliances (contd.)

Finalization of Filing of e-forms Verification of Consent to

supporting with CRC documents establish &
documents operate
Setting up legal existence of the entity

Issue of Certificate of
Filing of electronic SPICe is duly filled and After payment of all fees Incorporation by CRC- Once
Memorandum of submitted to CRC for & stamp duties, CRC all the Forms are duly
Association (eMoA- incorporation of scrutinizes all forms and approved by CRC, the digitally
INC 33) & Articles of signed “Certificate of
company . may suggest changes in
Association (eAoA- Incorporation” is issued.
forms and/or
INC 34) MCA form FiLLiP for LLP
attachments In Case of LLP, LLP agreement
would be required
Payment of stamp is required to be signed and
duty/ filing fees. Form 27 is required for submitted to ROC within 30
Foreign LLP (FLLP) days of incorporation of LLP
Incase of foreign
subscribers physical Once the Incorporation
MOA and AOA is to be Certificate is received, LLP
filled in can start it’s operations.

A company having share

capital is required to file a
declaration of receipt of
subscription amount and
verification of registered
office within 180 days of
incorporation and prior to
commencement of business.
Setting up business in India
Central level process/compliances (contd.)

Obtain Permanent Registration for Grant for BIS Quality Marking

Account Number Tax Account License Certificate
(PAN) Number (TAN)
Setting up legal existence of the entity

PAN number shall be allotted TAN number shall be Applicant has to submit Quality Marking
based on the information allotted based on the application in the certificate are
filled in Form SPICe at the information filled in Form prescribed Form & Self provided by
time of incorporation of a SPICe at the time of Evaluation-cum- Quality Marking
company. incorporation of a Verification Centre of the
company. Report along with State Government
prescribed documents
and original test
report(s) taxes) for
considering grant of
license under Product
Certification Scheme of
BIS.

List of products that

mandatory require BIS
license are listed in
Annexure I
Setting up business in India
State level process/compliances (contd.)

Registering / Approval for State Acquisition ofIEM/ EM

categorization of unit in Incentives (Optional)Land Registration
State
Starting/ Registering a unit in State

For starting a manufacturing unit Apply for state government All industrial undertakings exempt from
in any state, the first step for the incentives/ customised package the requirements of industrial licensing,
company is to register themselves scheme for Mega projects as per including existing units undertaking
as MSME or Mega or Large state policies (Optional) substantial expansion, are required to file
Projects. The criteria to categorise information in the prescribed form for
a unit into MSME or Mega Project Industrial Entrepreneurs Memorandum
or Ultra Mega Project is defined (IEM), i.e. “Form IEM”, with the
the in respective industrial Secretariat of Industrial Assistance (SIA),
policies of states. This would Department of Industrial Policy and
benefit the units to apply for Promotion (DIPP), Government of India,
various incentives available under and obtain an acknowledgement. No
state government Policies/ further approval is required
Scheme in addition to other
Optional for all Micro and small
specific policies.
enterprises; Service sector medium
enterprises; mandatory for
manufacturing sector medium
enterprises.

E-biz - Link
Setting up business in India
State level process/compliances (contd.)

MSME Registration
Guideline
Starting/ Registering a unit in State

Rule MSME can be registered by filling Udyog Aadhaar Memorandum. It is a

MSME Registration is an optional 12 digit Aadhaar number allotted to MSME by DIC
registration under the MSMED Act that
provides Micro, Small and Medium sized The Udyog Aadhaar Registration can be done online by individuals
enterprises with a host of benefits and themselves in case they have an Aadhaar number. However, in all
access to subsidies and schemes. exceptional cases, including those of not having Aadhaar number, can
still file Udyog Aadhaar Memorandum ,in offline mode(i.e. on paper
MSME Criteria form), with the General Manager(GM) of the concerned District
Industries are categorized as per turnover Industries Centre(DIC). Articles not covered under the MSMED Act
• Micro Enterprise - Annual turnover does 2006 for registration of Udyog Aadhaar Memorandum are listed in the
not exceed INR 5crs. link
• Small Enterprise – Annual turnover is
more than INR 5crs. but does not exceed A unit can apply for PRC for any item that does not require industrial
INR 75 cr license which means items listed in Schedule-III and items not listed in
• Medium enterprise – Annual turnover is Schedule-I or Schedule-II of the licencing Exemption Notification. Units
more than INR 75 cr but does not exceed employing less than 50/100 workers with/without power can apply for
INR 250 cr registration even for those items included in Schedule-II. Once the unit
commences production, it has to apply for permanent registration on
the prescribed form
Setting up business in India
State level process/compliances (contd.)

Acquisition of Land Acquisition ofPermission for Land Use

Environment, Forest and
Wildlife Clearance Land

Application to respective State DI/ Application for environment clearance Applicable in case industry located
Pre- Commissioning Phase

State Industrial Development (EC) need to be made at the online outside an industrial area
Corporation (SIDC)/ Infrastructure platform by MoEF.
Concerned departments:
Corporation/ Small Scale
Proposals requiring EC clearance under
Industrial Development ► State Directorate of Industries
EIA notification 2006. Proposals requiring
Corporation (SSIDC) (DI)
only CRZ Clearance under CRZ
► Department of Town and
Notification 2014. Proposals requiring
Country Planning
both clearances i.e. EC clearance
► Local authority/ District
(Category A and Category B both) under
Collector
EIA notification 2006 and CRZ Clearance
under CRZ notification 2011

Environment Clearance is 2 stage process.

Stage 1- Grant of ToR (If, after accepting
category A or category B proposals,
Ministry/SEIAA do not take any decision
within one month, then, Standard TOR is
accorded automatically to the proposal.
Stage 2- Grant EC - TOR accorded
proposals, Proposals without TOR
Setting up business in India
State level process/compliances (contd.)

Pollution Board Industrial License Consent to Establish

Application to State Pollution Boards Industrial licenses are regulated by the IDRA, Consent to establish is
before commencement of 1951 Act, and are approved by the Secretarial required from Environment
Pre- Commissioning Phase

construction activities and of Industrial Assistance (SIA) on the and pollution control board
production activities under Water Act recommendation of the licensing committee. for starting the building
and Air Act for Consent to Establish construction activity of the
Businesses planning to establish industries to
and CTO respectively is to be made unit. An application is to be
produce any of the following items in India
There are 4 categories of industries- must obtain a compulsory license: made to concerned bodies at
Distillation and brewing of alcoholic drinks; the state pollution board and
 Red – Industries having pollution
 Cigars and cigarettes of tobacco and central level for environment
index score of 60 and above
manufactured tobacco substitutes; clearance
 Orange- Industries having  Electronics and aerospace and defence
pollution index score of 41 to 59 equipment;
 Green - Industries having pollution  Industrial explosives including detonating
index score of 21 to 40 fuses, safety fuses, gun powder,
 White- Industries having pollution nitrocellulose and matches; and
index score up to 20  Hazardous chemicals including items
hazardous to human safety and health and
Note- The approval is granted by
thus fall for mandatory licensing.
state and compliance procedure may
Form IL
vary from state to state
Setting up business in India
State level process/compliances (contd.)

Factory Layout Plan Approval Factory registration

Under the Factory Act, 1948 approval for Factory Licensing is done under Industries (Development &
Pre- Commissioning Phase

Layout Plan is required. It is usually granted by the Regulation) Act 1951. only five industries are
Labour’s Department of each state however the under compulsory licensing:
competent authority may vary from state to state . ► Electronic aerospace and defence equipment
► Industrial explosives including detonating fuses,
The approval is granted within 60 days for safety fuses, gun powder, nitrocellulose and
chemical factory and 45 days for other factories matches
subject to the specific criteria met by the ► Cigars and cigarettes of tobacco and
competent authority of the state manufactured tobacco substitutes
► Specified hazardous chemicals i.e. (i)
The layout plan approved is non – transferrable. hydrocyanic acid and its derivatives (ii) Phosgene
and its derivatives and (iii) Isocyanates &
disocyanates of hydrocarbon not elsewhere
specified (example methyl Isocyanates)
► Distillation and brewing of alcoholic drinks
Industrial undertakings through online application
Form IL. Else IEM has to be availed The step by
step guide for availing IEM illustrated at the link
Setting up business in India
State level process/compliances (contd.)

Registration of Boilers Building Plan Registration under Registration under

Approval Contract Labour Act BOCW Act
1970

As per the Boiler Act 1923, An approval from development Under the Contract Under the Building and
Pre- Commissioning Phase

registration of Boiler is authority/ local nodal authority for Labour (Regulation and other Construction
mandatory compliance. sanction of building plans/ building Abolition) Act, 1970 Workers Act, 1996
Permission for registration permit under the provisions of approval required. It is approval required during
is granted post successful Building Byelaws, Master plan and usually granted by the pre and post
inspection. Local Body Acts. The Building Labour’s Department of commissioning stage. It is
approval comprises of the building each state however the usually granted by the
Provisional registration is plan and the layout approval for the competent authority Labour’s Department of
granted by the competent construction of the building. The may vary from state to each state however the
authority for the period of applicant has to get approval of state . competent authority may
6 months, within which the layout plan from concerned vary from state to state .
final inspection (upon authorities before starting The approval is granted
request) is undertaken. construction of. Intimation of within 30 days subject to The approval is granted
Disapproval or IOD basically states the specific criteria met within 30 days subject to
For further details and conditions that needs to be complied by the competent the specific criteria met
form link to be referred with during different phases of Under authority of the state by the competent
Construction Project. Post this the authority of the state
applicant received commence
certificate to commence construction
Setting up business in India
State level process/compliances (contd.)

Power for Provisional Fire Approval for lifts &

construction Approval Escalator

Application to State Provisional Fire Safety

Pre- Commissioning Phase

Lift and escalator

Electricity Distribution Approval from State approval needs to be
Company for sanction of Fire and Safety obtained from local
power supply for low department state authority.
tension (LT), high tension
(HT), or Extra High Approval is given for
Tension connection as installation and
applicable during the operation is accorded
construction phase separately
Setting up business in India
State level process/compliances (contd.)

Consent to operate Building Completion Final Fire Authorizatio

Water
certificate Approval n for
Connection
hazardous
waste
State Industrial Application to
Post- Commissioning Phase

Consent to operate is A completion certification (CC) Final Fire

obtained from is a critical and mandatory legal approval needs Development State Pollution
Pollution control board document that a builder should to be taken by Corporations for Control Boards
of the respective obtain from Application to local state approval for for Collection/
states. It is required in Town and Country Planning , or authority water Reception/
both pre- Local municipality , connections; to
commissioning stage. It development authority or
Treatment/
State Industrial
is subject to renewal agricultural department or Promotion Transport/
from time to time other local bodies such as Boards (where Storage and
Nagar Nigam or Gram applicable) Disposal of
Panchayat as applicable) with
where source of Hazardous
plan, scrutiny fees and land
allotment copy.
water is river/ waste
canal/ dam; and
After the completion of a to Central
project, the local authority Ground Water
inspects and evaluates the Commission in
premise against the approved case of ground
building plan and awards the water
completion certificate, if all the extraction
rules are satisfied.
Setting up business in India
State level process/compliances (contd.)

Power Environmental & Pollution Clearance

Post- Commissioning Phase

Application to State Electricity

Distribution Company for sanction of
power supply for low tension (LT), high
tension (HT), or Extra High Tension
connection as applicable
Setting up business in India
State level process/compliances (contd.)

GST Registration Professional Tax Central Excise

Registration Registration
Post- Commissioning of operations

Any business whose turnover exceeds the threshold limit According to section 5 of The application for
of INR 20 lakhs (INR 10 lakhs for North Eastern and hill the Profession Tax Act, registration is to be filed
states) will have to register under GST. Businesses every employer (not being with the Superintendent
registered under any of the pre-GST laws: VAT, an officer of the of Central Excise having
Excise/Service Tax have to register under GST by default. government is liable to jurisdiction over the
pay tax and shall obtain a premises in respect
Any business can get registered under GST by applying via certificate of registration whereof the registration
the GST Online Portal or at GST Seva Kendra set up by the from the prescribed is to be obtained.
Government of India. Fill Form-part A (PAN, Mobile and authority.
email id. The portal verifies your detail via OTP. Upload Note – Applicability of
the document as per business type. Fill Form-part B using The company is required Excise is for liquor and
the received number through OTP. Application reference to apply in Form I to the petroleum based units
number shall be received via mobile/ email. The GST registering authority
officer verifies your application/ document. In case more
information/ documents are asked through Form GST-
REG-03 details have to be shared through Form GST-REG-
04 within 7 working days. GST officer approves
application and GSTIN within 7 working days
Setting up business in India
State level process/compliances (contd.)

Shops & Establishment Act Employee Registration with ESIC

Post- Commissioning of Operation

Registration under Shop & Establishment is Employees' State Insurance Corporation

provided by state government (ESIC) provides monetary and medical
benefits to Employees in case of sickness,
maternity and employment injury and to
make provisions for related matters.
Form 01 should be used by employers to
register with ESIC
Setting up business in India
State level process/compliances (contd.)

Employer Trademark/ Importer Customs- Special

Registration with Brand Exporter Code Valuation Branch
EPFO Registration (IEC)
Post - Commissioning of Operations

The Employees' Provident Trademark registration Import Export (IE) Code is Special Valuation
Fund Organization (EPFO) provides legal right of a registration required for Branch (“SVB”) is
provides social security exclusivity for the use of persons importing or a branch of
benefits to Employees of mark to the owner of the exporting goods and the Custom House that
establishments on which mark. Trademark services from India. IE specializes in
the Employees’ Provident registration involves Code is issued by the investigating the
Fund and Miscellaneous multiple steps. A step by Directorate General of transactions involving
Provisions Act 1952. step guide for Foreign Trade (DGFT), relationship between
Online registration for registration of trademark Ministry of Commerce the supplier and the
EPFO can be done through is detailed at and Industries, importer. The detailed
link link Government of India. IE working and functions
Codes when issued can be of the branch can be
used by the entity accessed at
throughout its existence link
and doesn't require any
renewal or filing.
IE Code application must
be made to the
Directorate General of
Foreign Trade along with
the necessary supporting
documents.
2
Foreign Direct Investment
Permitted sectors
Prohibited Sectors
Eligible Investors & Instruments
Compliances/Requirements
– Reporting Requirements
– Guidance on Issue, Transfer, Conversion & Remittance of Shares
Foreign Direct Investment (FDI) in India
Investment climate in India has improved considerably since the opening up of the economy in 1991.
This is largely attributed to ease in FDI norms across sectors of the economy. India, today is a part of top 100 club on Ease of Doing Business
(EoDB) and globally ranks 1st in the greenfield FDI ranking. India received the record FDI of $ 60.1 bn in 2016-17.

100% FDI permitted through Automatic route

Category 1
Category 2

100% FDI permitted through Government route

100% FDI permitted through Government + Automatic route
Category 3

Upto

51% FDI permitted through Government/ Automatic route

Category 4

Upto

•Note:
i) In sectors/ activities not listed above, FDI is permitted up to 100% on the automatic route, subject to applicable laws/regulations; security and other conditions.
(ii) All the information/ contents provided herein is basis the Consolidated FDI Policy dated August 28, 2017 issued by DIPP from time to time as amended from time to time
For detailed definitions, clarifications/ exceptions, please refer to Consolidated FDI Policy, effective from August 28,2017*
*Amendment to FDI policy in Jan 2018
 Foreign Direct Investment (FDI) in India
Category 1 : 100% FDI permitted through Automatic route*

Agriculture & Animal Plantation (Tea, Coffee, Rubber, Mining & Exploration of metals & Coal & Lignite mining for Single Brand
Husbandry Cardamom, Palm oil tree, Olive oil non-metals ores excluding titanium captive consumption in Retail Trading,
tree) bearing minerals and its ores respect of eligible activities Duty Free Shops

Airports** & Railway Transport services*** Construction Development Cash & Carry Civil Aviation – Greenfield &
Infrastructure projects**** Wholesale Trading Brownfield

Exploration of Petroleum & Natural Broadcasting Market Place E-

Gas (including marketing of petroleum Carriage Services commerce Activities Asset Reconstruction & Credit Other Services at
products & natural gas) Information Companies Airport *****

Up-link of non-’News & Current Affairs’ Other Financial

Pharmaceuticals –
TV Channels, Down linking of TV channel Services (registered/
Greenfield Sector White Label ATM Industrial Park
regulated entity)
and Medical device Operations
manufacturing
*For detailed definition, clarifications/ exceptions, please refer to Consolidated FDI Policy, effective from August 28, 2017 , amendment to FDI policy in Jan 2018
** Greenfield and existing projects,
***Air Transport Services- Non Scheduled Air Transport Service / Helicopters services/ seaplane services requiring DGCA approval
****Construction Development: development of townships, construction of residential/commercial premises, roads or bridges, hotels, resorts, hospitals, educational institutions,
recreational facilities, city and regional level infrastructure, townships, Real estate Broking business
*****Other services include ground Handling Services subject to sectoral regulations and security clearance & Maintenance and Repair organizations; flying training
institutes; and technical training institutions
Foreign Direct Investment (FDI) in India
Category 2 : 100% FDI permitted through Government Route

Mining and minerals separation of Retail Trading including through e-commerce in respect Publishing/ printing of scientific and technical
titanium bearing minerals& ores of food products manufactured and/ or produced in magazines/specialty journals/ periodicals
its value addition & integrated India
activities

Government Route
(Approval from various Administrative
Ministries/ Government Department)*
Publication of facsimile edition of
Satellites-establishment
foreign newspapers
and operations

Foreign investment in core investment companies (CIC) and other investing companies, engaged in the activity of investing in the capital of other
company/ies/LLP, is permitted under Govt. approval route. CICs will additionally have to follow RBI regulatory framework

*For detailed definition, clarifications/ exceptions, please refer to Consolidated FDI Policy, effective from August 28, 2017 ,
amendment to FDI policy in Jan 2018
 Foreign Direct Investment (FDI) in India
Category 3 : Up to 100% FDI permitted through Government + Automatic route

Telecom
Services*
Up to
49% Automatic route Above
49% Government route

Defence industry Up to
49% Automatic route Above
49% Government route

Pharmaceutical -
Brownfield
Up to
74% Automatic route Above
74% Government route

Air Transport
Services **
Up to
49% Automatic route Above
49% Government route

Banking –
Private Sector
Up to
49% Automatic route Above 49% Government route

Up to 74%

Private Security Up to
49% Automatic route Above 49% Government route
Agencies*** Up to 74%

For detailed definition, clarifications/ exceptions, please refer to Consolidated FDI Policy, effective from August 28, 2017 , amendment to FDI policy in Jan 2018
* All telecom services including Telecom Infrastructure Providers Category-I, viz. Basic, Cellular, United Access Services, Unified License (Access Services), Unified License, National/International Long
Distance, Commercial V-Sat, Public Mobile Radio Trunked Services (PMRTS), Global Mobile Personal Communications Services (GMPCS), All types of ISP licenses, Voice Mail/Audio text/UMS, Resale of
IPLC, Mobile Number Portability Services, Infrastructure Provider Category-I (providing dark fibre, right of way, duct space, tower) except Other Service Providers.
** Air Transport Services- Scheduled Air Transport Service/ Domestic Scheduled Passenger Airline; Regional Air Transport Service- 49% automatic. Could go up to 100% via Govt. approval
*** FDI in Private Security Agencies is subject to compliance with Private Security Agencies (Regulation) (PSAR) Act, 2005, as amended from time to time
 Foreign Direct Investment (FDI) in India
Category 4 : Up to 51% FDI permitted through Government/ Automatic route
Automatic route

Insurance Infrastructure Companies

Petroleum Refining by PSUs* Power Exchanges Pension Sector
in Securities Markets

49% 49% 49% 49% 49%

Government route

Print Media-Publishing
Up-linking of ‘News & of Newspapers & Periodicals Publication
Terrestrial Broadcasting
Multi-Brand Retail Trading Banking Public Sector of Indian editions of foreign magazines
Current Affairs’ TV Channels FM (FM Radio) dealing with news and current affairs***
**

49% 49% 51% 20% 26%

For detailed definition, clarifications/ exceptions, please refer to Consolidated FDI Policy, effective from August 28, 2017 , amendment to FDI policy in Jan 2018
* Petroleum refining by the PSU without any disinvestment or dilution of domestic equity in existing PSUs – 49%, Automatic
** In specified states
***Print Media- Publishing of newspaper and periodicals; Indian editions of foreign magazines dealing with news and current affairs

49% in Air India- Govt. route (amended vide PN1 of 2018)

Foreign Direct Investment (FDI) in India
Prohibited Sectors

Lottery Business including

Gambling and Betting
Government/private lottery, Chit funds Nidhi company
including casinos*
online lotteries , etc.*

Sectors not open to private

Manufacturing of cigars, sector investment- atomic
Real Estate Business or
Trading in Transferable cheroots, cigarillos and energy, railway operations
Construction of farm
Development Rights (TDR) cigarettes, of tobacco or of (other than permitted
houses**
tobacco substitutes activities mentioned under
the Consolidated FDI policy)

Notes

*Foreign technology collaboration in any form including licensing for franchise, trademark, brand name, management contract is
also prohibited for Lottery Business and Gambling and Betting activities

**Real estate business shall not include development of town shops, construction of residential/ commercial premises, roads or
bridges and Real Estate Investment Trusts (REITs) registered and regulated under the SEBI (REITs) Regulations, 2014
 Foreign Investment in India
Eligible Investors & Instruments

Eligible Investors

Erstwhile OCB Company, FPI in terms of NRIs as per SBI registered

incorporated trust or FEMA (Transfer schedule 3 & FVCI in any
Any non- NRI resident outside India & partnership or Issue of 4 inText
terms of activity mentioned
Capital
resident & citizens of in Schedule 7 of instruments -
not under firm Security by FEMA
SWOT Equity, CCPS,
entity / Nepal & adverse notice incorporated Persons (Transfer or FEMA (Transfer
Analysis or Issue of CCDs
Individual Bhutan of RBI with outside India & Resident Issue of
Security by
Govt./RBI owned and Outside India) Security by PROI)
approval control by NRI Regulations PROI) Regulations
2017 Regulations
DRs &
FCCBs
Regulatory Policy

► FDI policy 2017

► Amendment vide FIFP,
PN1 of 2018 DIPP,
► FEMA Regulations GOI
► SEBI Regulations Others-
Warrants &
Paid up
shares
LLPs in sectors Startup NRI/PIO
VCF registered Non Residents
wherein FDI is companies can resident
as Trusts and (other than
100% allowed issue equity/ outside India Indian
regulated by NRI/PIO) can companies can Sponsored
through equity linked can invest in ADR/ GDRs
SEBI and invest in issue capital
automatic route instruments or Partnership
‘Investment Partnership Firm against FDI
& no FDI linked debt instruments Firm/
Vehicle’ / Proprietary
performance or convertible Proprietary
(REIT/INVIT/AIF) Concern
condition notes Concern

Eligible Investee Entities

 Foreign Direct Investment (FDI) in India
*Compliances/Requirements - Reporting Requirements

Funds Received from Allotment of Shares Form FC-GPR (SMF)

Foreign Entity
30 Days

Illustration: Documents for Form FC-GPR

• CS certificate • Declaration by the Authorised Representative of the Indian

• Pre and post shareholding pattern in the Indian company Company/LLP
• Copy of the order of the High Court on the scheme of merger/ • Copy of government approval (if applicable)
demerger/ amalgamation (if applicable) • RBI approval on the amount of refund with respect to the amount
• Valuation certificate of the issue (if applicable)
• Relevant RBI approvals for an issue of equity shares against funds • Approval letter (if non-compliant with the guidelines – if applicable)
payable to the foreign investor • FIRC/ Debit statement
• Know Your Customer (KYC) • Board Resolution

* As per the RBI notification on “Foreign Investment in India - Reporting in Single Master Form” of 7th June 2018, now provides for all the extant reporting structures of
various types of foreign investments in India are now provided under a Single Master Form (SMF) which is required to be filed online.
As per the RBI Notification ARF and FC-GPR is merged into a single revised FC-GPR (SMF). All new filings for the Form FC-GPR (SMF) have to be done in Single Master
Form only.
Foreign Direct Investment (FDI) in India
Compliances/ Requirements - Issue, Transfer, Conversion &
Remittance of Shares
Issue of Shares
Issuance within 60 days from day of receipt of inward

1 remittance; else refunded immediately to non-

resident investor by outward remittance through
normal banking channels or by credit to NRE/FCNR (B)
account as the case may be within fifteen days Repatriation

4
from the date of completion of 60 days
Repatriation for dividend and Interest
Transfer of capital instruments Dividend and interest on fully, mandatorily &
Permission granted to Non-Resident (NR) / Non- compulsorily convertible debentures is freely
Resident Indian (NRI) for acquisition of capital repatriable without any restrictions
instruments in following ways: NR to NR, NRI to NRI,
NRI to Resident, Resident to NRI, while a person
resident outside India can sell capital instruments of

2
an Indian company on a recognized Stock Exchange in
India through a registered stock broker. Transfer
between resident and non-resident should be in
compliance with extant guidelines and reporting needs
Remittance

5
to be done in Form FC-TRS. In respect of transfer of
capital instruments between resident and non- Remittance of asset (i.e. sale proceeds of share and
resident, an amount not exceeding 25% of the total securities and their remittance) is governed by the
consideration can be deferred or settled through Foreign Exchange Management (Remittance of Assets)
escrow mechanism. Regulations, 2016 under FEMA

Conversion into Equity 46

3
Indian companies have been granted general
permission for conversion of External Commercial
Borrowings (ECB) (excluding those deemed as ECB) in
convertible foreign currency into equity shares/fully
compulsorily and mandatorily convertible preference
shares, subject to conditions
 Foreign Direct Investment (FDI) in India
Guidance on Issue, Transfer, Conversion & Remittance of Shares
Step 1: Issue of shares Step 2: Transfer of Capital instrument

Capital instruments should be issued within 60 days Permission granted to non-residents / NRIs for ► Resident to non-resident- Transfer of capital
from day of receipt of inward remittance; else acquisition of Capital instrument by way of transfer instruments by way of gift- prior RBI approval
refunded immediately to the non-resident investor in. the following required
by outward remittance through normal banking ► Non – resident( other than NRI or erstwhile ► In respect of transfer of capital instruments
channels or by credit to NRE/FCNR (B) account. OBC) to Non resident –Transfer by way of between resident and non-resident, an amount
Issue price of shares * Sale/gift permissible in sectors which are under not exceeding 25% of the total consideration:
automatic route. Government approval
required for transfer of Capital instrument in ► Can be paid by buyer on a deferred
► In case of Listed Indian company, not less than basis within a period not exceeding 18
price worked out in accordance with SEBI sectors which are under Government approval
route months from the date of transfer
guidelines agreement; or
► In case of unlisted Indian company- not less ► NRIs/OCI to PROI- transfer by way of sale or
gift the Capital instrument provided that prior ► can be settled through an escrow
than fair valuation done by SEBI registered arrangement between the buyer and
Merchant Banker or a Chartered Accountant Government approval shall be obtained for any
transfer in case the company is engaged in a the seller for a period not exceeding
or practicing cost accountant as per any 18 months from the date of the
internationally accepted pricing methodology sector which requires Government approval
transfer agreement; or
on an arm’s length basis ► Non resident to resident - transfer any Capital
instrument by way of gift. Transfer of capital ► can be indemnified by the seller for a
► For non-residents (including NRIs) making period not exceeding 18 months from
investment in Indian company by way of instrument, by way of sale under private
arrangement, subject to extant guideline. the date of the payment of the full
subscription to its Memorandum of consideration, if the total
Association, then such investments may be ► A person resident outside India can sell capital consideration has been paid by the
made at face value subject to their eligibility to instrument of an Indian company on a buyer to the seller.
invest under the FDI scheme recognized Stock Exchange in India through a
* in case of convertible capital instruments, the price/ registered stock broker or a registered
conversion formula of the instrument should be merchant banker in manner prescribed by SEBI
determined upfront at the time of issue of the ► Resident to non resident- transfer of capital
instrument. The price at the time of conversion should instrument by way of sale subject to extant
not in any case be lower than the fair value worked out,
guidelines.
at the time of issuance of such capital instruments
Foreign Direct Investment (FDI) in India
Guidance on Issue, Transfer, Conversion & Remittance of Shares
Step 3: Transfer of Capital Instruments Step 4: Conversion into Equity

Transfer from resident to non-resident or vice-versa shall not be 1. Text

Indian companies have been granted general
less than/exceeding: 2. Text for conversion of External
permission
(a) the price worked out in accordance with the relevant SEBI Commercial
3. Text Borrowings (ECB) (excluding those
guidelines in case of a listed Indian company; deemed as ECB) in convertible foreign currency
(b) the price at which a preferential allotment of shares can be into equity shares/fully compulsorily and
made under the SEBI guidelines, as applicable, in case of a listed mandatorily convertible preference shares,
Indian company subject to the following conditions
(c) the valuation of capital instruments done as per any ► Activity of company is covered under the
internationally accepted pricing methodology for valuation on an automatic route or government approval
arm’s length basis duly certified by a Chartered Accountant or a
for FDI
Securities and Exchange Board of India registered Merchant
Banker or a practicing Cost Accountant, in case of an unlisted ► The foreign equity after conversion of ECB
Indian Company. into equity is within the sectoral cap, if any
Reporting of transfer of capital instruments between residents ► Pricing of shares as per extended
and non-residents and vice versa is to be done in Form FC-TRS. guidelines
The Form FC-TRS should be submitted to the AD Category-I bank,
► Compliance with the requirements
within 60 days from the date of receipt of the amount of
consideration.
prescribed under any other statute and
regulation in force
► General permission is also available for
Prior approval of RBI required: Resident to non-residents by way of issue of shares/preference shares against
sale
lump sum technical know-how fee, royalty
• Transfer is at a price which falls outside the pricing guidelines
specified by the RBI from time to time and the transaction does
due for payment, subject to entry route,
not fall under the exception given sectoral cap and applicable pricing
• Transfer involving deferment of payment of the amount of guidelines and compliance with applicable
consideration more than 25% of the total consideration would tax laws
require RBI approval. Post approval, the same should be
reported in Form FC-TRS, to an AD Category-I bank within 60
days from the date of receipt of the full and final amount of
consideration.
Foreign Direct Investment (FDI) in India
Guidance on Issue, Transfer, Conversion & Remittance of Shares
Step 5: Repatriation Step 6: Remittance

Repatriation for dividend and Interest Sale proceeds of shares & securities:
► Dividend is freely repatriable without any restrictions ► Remittance of asset (i.e. sale proceeds of share and securities
► Dividend is net after tax deduction at source (TDS) or and their remittance) is governed by the Foreign Exchange
dividend distribution tax (DDT) (if any as the case may be) Management (Remittance of Assets) Regulations, 2016 under
FEMA
► Dividend is governed by Foreign Exchange Management
► AD Category-1 can allow remittance of sale proceeds (net of
(Current Account Transactions) Rules, 2000
applicable taxes) of a security to the seller of shares outside
► Interest on fully, mandatorily & compulsorily convertible India provided security has been held on repatriation basis,
debentures is freely repatriable without any restrictions. Sale of security has been made in accordance with the
► Interest is net of applicable taxes prescribed guidelines and NOC/ Tax clearance certificate from
► Interest is governed by Foreign Exchange Management the Income Tax department
(Current Account Transactions) Rules, 2000

Winding up/ liquidation of companies AD Category 1 banks are

allowed to remit winding up proceeds of the companies which are
under liquidation subject to payment of taxes . Applicant needs to
submit the following to the AD Category 1 bank for remittance
► Auditor’s certificate confirming All liabilities in India have been
either fully paid or adequately provided , Winding up is in
accordance with the provisions of the Companies Act as applicable
and lastly in case of winding up otherwise than by a court- No legal
proceeding pending in any court in India against the applicant or
company under liquidation
3
Institutional & Regulatory framework
Routing FDI in India
Concerned Administrative Ministries/Departments
Applicable regulatory framework for Business establishments
Governing Bodies for Business establishments
Winding-up of Business
Institutional and Regulatory Set-up
Routing FDI in India
Routing Investments in India

Automatic Route Government Route

Sectoral FDI Investment Limit

(Consolidated FDI Policy, effective from August 28, 2017 , amendment to FDI
policy in Jan 2018 )

• DIPP is the nodal agency entrusted to formulate FDI Policy

– issues press notes to make amendments in the existing policy

and also issues consolidated FDI Policy on an annual basis

• FDI in India is administered under Foreign Exchange Management

(Transfer or Issue of Security by a Person Resident Outside India)
Regulations, 2017 notification dated November 01, 2017 (Original
notification is available at
[Link]
&Mode=0; )

• The procedural instructions are issued by the Reserve Bank of India

vide A.P. (DIR Series) Circulars. The regulatory framework, over a
period of time, thus, consists of Acts, Regulations, Press Notes, Press Where the online application is digitally signed by an authorised signatory,
Releases, Clarifications, etc. there is no requirement for physical submission of the application.
However, for applications without a digital signature, once the e-filing of
• The revised level of approvals for cases under the Government the application is complete, the applicant is required to file one signed
route are summarized in the new notification dated 5 June, 2017 copy of the printed application, along with duly authenticated copies of the
documents attached with the application, with the nodal officers of the
available at the link: [Link] concerned Ministry/Department. 51
Institutional and Regulatory Set-up
Concerned Administrative Ministries/Departments
The work of granting government approval for foreign investment under the extant FDI Policy and FEMA Regulations, shall be
entrusted to the concerned Administrative Ministries/Departments as listed below:
S. No Sector/ activity Administrative Ministry/ Department
1 Mining Ministry of Mines
2 (a) Defence – items requiring license under the industries(Development & Department of Defence Production, Ministry of Defence
Regulation) act 1951 and/or arms act 1959
2 (b) Cases relating to FDI in small arms. Ministry of Home Affairs
3 Broadcasting. Ministry of Information and Broadcasting
4 Print Media. Ministry of lnformation and Broadcasting
5 Civil Aviation Ministry of Civil Aviation
6 Satellites Department of Space
7 Telecom Department of Telecommunications

8 Private Security Agencies Ministry of Home Affairs

9 Applications involving investments from Countries of Ministry of Home Ministry of Home Affairs
Affairs Concern which presently include Pakistan and Bangladesh, requiring
security clearance as per the extant FEMA 20, FDI Policy and security
guidelines, amended from time to time
10 Trading (Single & multi brand and food products retail trading) Department of lndustrial Policy & Promotion.
11 FDI proposals by Non-Resident Indians (NRIs)/ Export Oriented Units Department of lndustrial Policy & Promotion.
requiring approval of the Government
12 Applications relating to issue of equity shares under the FDI policy under the Department of lndustrial Policy & Promotion.
Government route for import of capital goods/machinery/equipment
(excluding second-hand machinery)
Institutional and Regulatory Set-up
Concerned Administrative Ministries/Departments
S. No Sector/ activity Administrative Ministry/ Department

13 Applications relating to issue of equity shares for pre- operative/pre-incorporation Department of lndustrial Policy & Promotion.
expenses (including payments of rent etc.)
14 Financial services activity which are not regulated by any Financial Sector Regulator Department of Economic Affairs
or where only part of the financial services activity is regulated or where there is
doubt regarding the regulatory oversight
15 Applications for foreign investment into a Core Investment Company or an Indian Department of Economic Affairs
company engaged
only in the activity of investing in the capital of other India Company/ies.
16 Banking (Public and Private) Department of Financial Services
17 Pharmaceuticals Department of Pharmaceuticals

Note
• In respect of sectors/activities which are presently under automatic route but required Government approval earlier as per the extant policy during the
relevant period, concerned administrative Ministry/Department would be the Competent Authorities for the grant of post-facto approval for foreign
investment.
• In respect of applications in which there is a doubt about the Administrative Ministry/Department concerned, DIPP shall identify the Administrative
Ministry/Department where the application will be processed.
• Proposals for foreign investment would be examined by Competent Authorities as per the Standard Operating Procedure laid down by DIPP (available at
[Link]
• In case of proposals involving total foreign equity inflow of more than INR 5000 cr, Competent Authority shall place the same for consideration of
Cabinet Committee on Economic Affairs (CCEA).
• The CCEA would also consider the proposals which may be referred to it by the Minister in-charge of the concerned Competent Authority.
• In respect of proposals where the Competent Authority proposes to reject the proposals or in cases where conditions for approval are stipulated in
addition to the conditions laid down in the FDI policy or sectoral laws/regulations, concurrence of DIPP shall compulsorily be sought by the Competent
Authority.
• The monitoring of the compliance of conditions under the FDI approvals, including the past cases approved by the Government, shall be done by the
concerned Administrative Ministries/Departments.
 Institutional and Regulatory Set-up
Applicable regulatory framework for business entities
Limited Liability The Indian Partnership
Companies Act, 2013 Competition Act, 2002
Partnership Act, 2008 Act, 1932
► The Companies Act, 2013 ► A corporate business ► An Act to define and ► An Act to provide, keeping
passed by the Parliament vehicle that enables amend the law relating to in view of the economic
has received the assent of professional expertise and partnership. It lays out the development of the
the President of India on entrepreneurial initiative complete structure of a country, for the
29th August, 2013 to combine and operate in partnership firm establishment of a
flexible, innovative and constituting definition of Commission to prevent
► The act governs efficient manner, partnership firm, its practices having adverse
companies, their providing benefits of registration ,management effect on competition, to
incorporation, allocation limited liability while and dissolution procedure, promote and sustain
of share capital, allowing its members the and interrelation between competition in markets
administration, flexibility for organizing partners. State
management, reporting their internal structure as governments have made ► The Act lays down rules
and filing, dissolution and a partnership rules regarding certain and procedure for
compliances of all types of provisions of the act formation of the
companies under its ► The Act defines of LLP’s, competition commission,
ambit. It also lays down their incorporation, its administration and
guidelines for conversion to LLP, management, and its
memorandum of contribution of partners, duties, powers and
association and articles of administration, functions. It also talks
association for different management, reporting about the organisation
types of companies and filing, and dissolution and working of
Competition Appellate
Tribunal.

Others : Income tax Act 1961, GST act, Shops and establishment acts etc.
Institutional and Regulatory Set-up
Applicable regulatory framework for business establishments
Taxation Overview in India
Over the last few years, the government of India (GoI) and various State (provincial) Governments have undertaken various policy reforms
and process simplification towards great predictability, fairness & automation. This has consequently, lead to India’s meteoric rise to the
top 100 in the World Bank’s Ease of Doing Business (EoDB) ranking in 2017.

Key Features of India’s taxation System: Taxes in India are levied by the Central Government and the State Governments. Some minor
taxes are also levied by the local authorities such as the Municipality and Local Government.

Major Central Taxes Major State Taxes

► Income Tax ► State Goods & Services Tax (SGST)
► Central Goods & Services Tax (CGST) ► Stamp Duty & Registration
► Integrated GST (IGST)
► Custom Duty

A resident company is taxed on its worldwide income. A non-resident company is taxed only on income that is received in India,
or that accrues or arises, or is deemed to accrue or arise, in India. Company whether Indian or foreign is liable to taxation, under
the Income Tax Act,1961. Corporation tax is a tax which is levied on the incomes of registered companies and corporations..
Taxes In India are primarily into 2 categories- Direct and Indirect Tax.

Note: For detailed information, please refer to Taxation in India page ([Link]
Institutional and Regulatory Set-up
Applicable regulatory framework for business establishments
Goods and Services Tax (GST) is a
unified indirect tax across the country on
products and services. It is a comprehensive Old Regime GST Regime
levy on manufacture, sale and consumption,
under which no distinction is made between • Custom Duty Custom duty
goods and services for levy of tax. It is a
destination based consumption tax.
• • Central Excise Duty (CENVAT)

Central Taxes
The GST, dual in nature is levied by
both the Centre and State. The Central • Additional Excise Duties and the Excise Duty levied
under the Medicinal and Toiletries Preparations
GST (CGST) is levied on intra state Central GST
Act, 1955
supply of goods and / or service and • Service Tax Integrated GST
State GST (SGST) is levied by the States. • Additional Customs Duty (CVD)
• Integrated GST (IGST) is levied and • Special Additional Duty of Customs (SAD)
administered by the Centre on every • Surcharges and Cesses levied by the Centre
inter-state supply of goods and • Central Sales Tax
services.
• VAT/ sales tax
• Import of goods or services is treated as • Octroi and Entry Tax
State Taxes

inter-state supplies and is subject to • Purchase Tax State GST/

IGST in addition to Basic Custom duty. • Luxury tax Union Territory GST
• CGST, SGST and IGST is levied at • Taxes on lottery, gambling and betting
uniform rates, mutually agreed upon by • Entertainment tax (unless levied by the local bodies)
the Centre and the States under the • Surcharges & State Cesses (related to the supply of
goods and services)
aegis of the GST Council (GSTC).
• All goods and services are covered
under GST except alcohol for human
consumption, electricity, sale / Assessment and filing on GST Network (GSTN)
purchase of real estate, specified
petroleum products and tobacco
products.
Institutional and Regulatory Set-up
Applicable regulatory framework for business establishments
GST TDS Income Tax Filing

► Forms GSTR 1, 2, 3 are to be a filed by a person registered under ► TDS is deposited 07 ► Advance tax for
GST for each month other than the people who are registered date of every month companies to be
under the composition scheme deposited in 4
► Filling of quarterly TDS instalments i.e. by 15
► A person registered under the composition scheme has to file GSTR- return is to be June, 15 Sep, 15 Dec
4 under GST for each quarter. undertaken by 31 and 15March for
July, October, January every financial year
► GSTR-9A is an annual return which is to be filed by both registered and May for each
or unregistered under composition scheme by 31 December 2018 quarter respectively ► Filing of return to be
for the financial year 2017-18. undertaken by 30
► Issue of quarterly September (incase of
► GSTR-1 : Monthly (10th
day of next month) certificate by 15 Aug, no internal
► GSTR-2 : Monthly (15th day of next month) November, February transaction / transfer
► GSTR-3 Monthly (20 th day of next month and 30 May for each pricing. Incase of
► GSTR-3B Monthly (20 th day of next month quarter respectively Transfer pricing it will
► GSTR-4 Quarterly (18th of month succeeding quarter) be 30 Nov
► GSTR 5: Monthly (20th of next month) ► Filing of Form
► GSTR 6: Monthly (13th of next month) 15G/15H form by 07 ► Time limit for filing of
► GSTR 7: Monthly (10th of next month) April the revised return is
► GSTR 8: Monthly (10th of next month) 1 year from the end
► GSTR 9: Annual (31st Dec of next financial year) ► Issuance of yearly TDS of the assessment
► GSTR 9A: Monthly (31st Dec of next financial year) certificate by 31 May year
► GSTR 10: One time (within 3 months of GST registration is
cancelled/ surrendered )
► GSTR 11: Monthly (28th of next month)
Note- These date are as per the GST Act 2017. For August , September and October GST schedule please refer to latest notification at [Link]
Institutional and Regulatory Set-up
Governing Bodies for business establishment
Ministry of Corporate Affairs is primarily concerned with administration
Companies of the Companies Act 2013, the
Limited Liability Partnership Act, 2008, Competition Act & other allied Acts and rules & regulations framed there-under mainly for
regulating the functioning of the corporate sector in accordance with law

Agencies of MCA Agencies under MCA Other Agencies

Supervision
Registrar of Companies Competition Commission of India National Company Law Tribunal

Official Liquidators The Institute of Chartered Accountants National Financial Reporting Authority
of India
Securities Exchange Board of India
Regional Directors The Institute of Company Secretaries of
India State Governed

Central Registration Centre The Institute of Cost Accountants ofIndia The Reserve Bank Of India

Central Board of Direct Taxes

Central Board of Excise and Customs

Controller & Auditor General of India

Central Vigilence Commission

Income Tax Department

State Commercial Tax Department

Municipal Bodies/ Local Property tax

Department
 Institutional and Regulatory Set-up
Winding-up of business establishments

Prepare declaration Intimate Statutory Filing application for

of solvency and hold authorities and winding up
board meeting banker

Obtain shareholders, Submit preliminary NCLT to pass

creditors approval & report on verification dissolution order
appoint liquidator of claims by
liquidator

Public notice inviting Realise assets,

claims discharge liabilities
and repatriate funds
if any

For details w.r.t winding up, refer :

Company : sec 2(94A) and sec 272 of companies act 2013 : [Link] along with provisions of insolvency and bankruptcy code :
[Link]
LLP : Section 63, 64 and 65 of LLP Act 2008 : [Link]
Partnership : sec 40-44 of the Partnership Act 1932, [Link]
4
Annexures :
List of Documents required of DSC, DIN
List of Documents required of OPC , Private Limited
List of Documents required of LLP, BIS
List of Documents required of FIFP
List of Documents required of Foreign Bank Branch
Investment Options for Foreigners
Contacts
 Annexure I: List of Documents required
DSC DIN

List of documents required for Digital The DIR-3 form must contain a photo of the DIN applicant along with the details
Signature Certificate of the applicant and the following documents:
► Address Proof ► In case of Indian nationals, Income-tax PAN is a mandatory requirement for
► Aadhaar card proof of identity.
► PAN card ► Address proofs like passport, election (voter identity) card, and ration card,
► Photo driving license, electricity bill, telephone bill or Aadhaar shall be attached and
► Email Id should be in the name of applicant only.
► Phone Number ► In case of Indian applicant, documents should not be older than 2 months
from the date of filing of the eForm.
Note: ► In case of foreign applicant, address proof should not be older than 1 year
i. PAN is mandatory for Indian from the date of filing of the eForm.
ii. Passport is mandatory for foreigner ► DIN for foreign nationals can be obtained by providing a copy of the foreign
iii. Documents to be notarized & nationals passport that is notarised and apostilled. The passport copy
apostilled for foreigners attached for the foreign national DIN applicant must contain the date of birth
iv. Video and mobile verification is of the applicant. If passport does not include date of birth, then an additional
mandatory. proof containing date of birth must be submitted, duly certified or attested.
► It is mandatory to attach a copy of board resolution for appointment of
director in an exiting company
 Annexure II: List of Documents required
OPC Private Limited Company

List of documents required for filing OPC List of documents required for filling List of documents required for filling
► PAN of main director and Nominee SPICe form for Private Limited SPICe form for Private Limited Company
Director (Both the directors should be Company for Indian Nationals for Foreign National
Indian nationals ) ► PAN card ► Passport
► Address Proof of Director & Nominee ► Address Proof ► Address Proof
Director – Passport, Driving License, ► Passport ► Driving License
Aadhaar , Bank Statement or ► Election Card or Voter ► Residence Card
electricity bill (Any two of these docs Identity Card ► Bank Statement
must be valid and recent ► Ration Card ► Government issued form of
► Proof of registered office in India – ► Driving License identity containing address
Rent Agreement , Sale Deed, Copy of ► Electricity Bill ► Residence Proof
Electricity bill, Property Tax receipt . ► Telephone Bill ► Bank Statement
NOC from landlord for use of premises ► Aadhaar Card ► Electricity Bill
as registered office ► Residence Proof (in case present ► Telephone Bill
► Sign Digital Signature Application and permanent address are ► Mobile Bill
different) ► Registered Office Proof- proof of
► Bank Statement registered office during the company
► Electricity Bill registration process or within 30 days
► Telephone Bill of incorporation of the company
► Mobile Bill ► The notarized copy of lease / rent
agreement in the name of the
company along with a copy of rent
paid receipt not older than one month
► The authorization from the Landlord
 Annexure III: List of Documents required
LLP BIS

List of documents required for filing OPC ► List of Products that mandatory require BIS
► PAN Card of the Partners license are :
► Address Proof of the Partners ► Cement
► Utility Bill of the proposed Registered ► Household electrical goods
Office of the LLP ► Food and related products
► No-Objection Certificate from the ► Diesel engines
Landlord ► Oil pressure stoves
► Rental Agreement Copy between the ► Automobile accessories
LLP and the Landlord ► Cylinders, Valves and Regulators
► Medical Equipment's
► Steel Products
► Electrical Transformers
 Annexure IV: List of Documents required
FDI approval : Foreign Investment Facilitation Portal (FIFP)

List of documents required for filing application through FIFP: ► Copy of Downstream Intimation
► Certificate of Incorporation of the Investee & Investor ► Copy of relevant past FIPB/SIA/RBI approvals, connected with
Companies/Entities (Investee company may be a proposed the current proposal (in case of amendment proposal)
entity and may not be incorporated) ► Foreign Inward Remittance Certificate (FIRC) in case investment
► Memorandum of Association (MOA) of the Investee & Investor has already come in and in case of post-facto approval
Companies/Entities ► In the cases of investments by entities which themselves are
► Board Resolution of the Investee & Investor pooled investment funds, the details such as names and
Companies/Entities addresses of promoters, investment managers as Standard
► Audited Financial Statement of Last Financial Year of the Operating Procedure for Processing FDI Proposals 9 well as all
Investee & Investor Companies/Entities the contributors to the investment fund
► Article of Association of the Investee & Investor ► List of the downstream companies of the Indian company and
Companies/Entities the details of the equity held by the Indian Company along with
► List of Names and addresses of all foreign collaborators along the details of the activities of the companies
with Passport Copy/ Identification Proof of the Investor ► High Court order in case of a scheme of arrangement
Company/Entity ► Valuation certificate as approved by a Chartered Accountant
► Diagrammatic representation of the flow and funds from the ► Non-compete clause certificate of the investor and investee
original investor to the investee company and Pre and Post company in case of investment in pharmaceutical sector (As
shareholding pattern of the Investee Company per Annexure 10 of Consolidated FDI Policy Circular of 2016),
► Affidavit stating that all information provided in hard copy and and as amended from time to time
online are the same and correct ► Certificate of statutory auditors as mandated in the FDI policy,
► Signed copy of the JV agreement/shareholders agreement/ as applicable
technology transfer/trademark/brand assignment agreement
(as applicable), in case there are existing ventures
► Board resolution of any joint venture company
► Certificates of Incorporation and charter documents of any
joint venture/company which is a party to the proposed
transaction 64
 Annexure V: List of Documents required
Additional information to be furnished by the Promoters along with relevant supporting documents for setting up
Foreign Bank Branch in India (Annex II)
List of documents required for Existing Structure List of documents required for Proposed Structure
► Information on the individual promoters behind the group ► The applicants should furnish detailed information about the
A. Self-declaration by the individual promoters as per Appendix persons/entities, who would subscribe to 5 per cent or more of
B. Detailed profiles on the background and experience of the the paid up equity capital (shareholding pattern) of the
individual promoters, his/their expertise, track record of proposed bank, including foreign equity participation in the
business proposed bank and the sources of capital of the proposed
► Information on entities in the promoter group : investors.
A. Names and details of other entities in the promoter group as ► The proposed promoter shareholding and plan for dilution of
per Appendix II (if not covered in Appendix I). promoter shareholding in compliance with the guidelines.
B. Shareholding pattern of all the entities in the promoter ► Proposed management of the bank, if finalized
group.
C. A pictorial organogram indicating the corporate structure of Project Report
all the entities in the group indicating the shareholding and ► A project report9 covering business potential and viability of
total assets of the entities. the proposed bank, any other financial services proposed to be
D. Annual reports of the past five years of all the group entities. offered, plan for compliance with prudential norms on
► Information on the promoting / converting entity: CRR/SLR10, composition of loan portfolio, priority sector, etc.
a. Declaration by the promoting / converting entity as per as per the guidelines, and any other information that they
Appendix III. consider relevant.
b. Shareholding pattern of the promoting / converting entity. ► The project report should give as much concrete details as
c. Memorandum and Articles of Association and financial feasible, based on adequate ground level information and
statements of the promoter entity for the past five years avoid unrealistic or unduly ambitious projections. The business
(including a tabulation of important financial indicators for the plan should address how the bank proposes to achieve
said years), board composition and representation of the financial inclusion and in the case of an NBFC applicant, how
Directors over a period of ten years, income tax returns for the existing lending business will fold into the bank or divested
last three years, C.A certificate indicating source of funds for / disposed of
promoting / converting entity
Annexure VI: Investment options for foreigners

Investment options for

foreigners

Investment in
Investment in unlisted/ Investment
listed companies ADRs and Investment Vehicle
listed companies (except by NRIs/
through stock GDRs* (REITs, INVITS, AIF)
through Stock Exchange) PIOs
exchange

Repatriable Non- repatriable

Foreign Direct Foreign Foreign

Investment Venture Capital Portfolio
(FDI) Investor Investors (FPI)

Note: An investor can participate in Indian economy by either commencing business in India (forms explained earlier) via, say
the FDI route as outlined above or can invest in the financial markets via a host of available financial instruments. A few of
these have been enumerated in the subsequent slides. In particular, FDI has been explained in detail in Section 2 of this
document.
 Annexure VII: Contacts
Please connect, in case of doubt.

INVEST INDIA (Investment Facilitation Cell)

Vigyan Bhavan, Annexe,
Maulana Azad Road,
New Delhi 110011
Tel: +91-11-23048155
Email: info@[Link]
Website: [Link]

FDI Approval related queries MCA related queries

Address: Foreign Investment Facilitation Section DIPP MCA online service related link:
Udyog Bhawan, New Delhi-110001, India [Link]
Email: fifp-dipphelpdesk@[Link] [Link]
FIFP Status-Enquiry link :
[Link]
Disclaimer

We make no claims, promises, assurances, or guarantees about the accuracy,

completeness, or adequacy of any information contained in this document. Nothing
contained on this website should be construed to constitute a recommendation,
endorsement or views of the Government. Since the policy evolves and is amended
regularly, the user is advised to ascertain the position as per the Policy and other
extant law and regulations at the relevant time. In case of any dispute, the position as
per extant law and policy, as amended from time to time shall only be valid.

Invest India, its management, directors, employees or staff, shall not be held
responsible or held liable for any information contained in the response/clarification
or any action/ consequence arising out of any contrary view(s) taken by any other
party or statutory authority qua this document.