Wholly-Owned Subsidiary in India

Wholly-Owned Subsidiary in India

As the name suggests, wholly owned Subsidiary means wholly owned by parent company. It’s the trend going on wherein the majority of multinational corporations register a Wholly-Owned Subsidiary as means of extending business in the target country for the ultimate purpose of capturing market in the destination country.

Let’s understand this with example;

➢     What is a wholly owned subsidiary?

WOS is the entity whose shares is 100% held by the holding company. Though Companies Act 2013 says to have minimum two shareholders so keeping in mind the compliance under Companies Act 2013, we have generally two shareholders i.e.;

n  Steerabidance Inc. USA as Body Corporate registered outside India through its Authorised Representative Mr. X holding 9999 equity shares

n   Mr. Y as Nominee Shareholder holding 1 equity share

n  Pls note that here we assume that the total number of equity shares in the Company is 10,000 equity shares.

➢     Registration of a Wholly Owned Subsidiary Company in India is a 4 step Procedure

1. Obtaining Digital Signature for foreigners:

a. Digital Signature of each applicant is required.

b. The form of the digital signature should be attested by a CA or a CS.

c. Documents requirements:

-          Notarized and apostilled passport copy

-          Notarized and apostilled address proof

-          passport size photo

-          mobile number and email id

2. Obtaining Director Identification Number (DIN) for foreigners:

Read the blog for more information on how to obtain DIN for Foreigner;

http://csnehasethassociates.blogspot.in/2016/06/din-of-foreigner.html

a. Documents/ Information requirements:

-          In addition to the above documents provided for obtaining DSC, we require;

-          Notarised & Apostilled Present and permanent address proof

-          Educational qualifications and occupation

-          Whether resident in India?

-          Citizenship

-          Father’s name ( if not reflecting in passport)

-          Digital signatures

3. Filing Name Application with ROC :

a. Requirements

-          Board resolution

-          certificate of incorporation (USA)

-          DIN for both the directors

-          registered office details (India)

4. Registration of the Company:

a.      Filing of Registration in eForm SPICE 32

-          Once name gets approved, we need to file eForm SPICe  along with INC 33 and INC 34 with the following documents: -

-          INC 9 Affidavit

-          Affidavit Cum Declaration

-          Declaration for first Director

-          DIR 2 consent from Directors

-          Registered office Proof in Chennai along with NOC from Owner

-          Subscription Sheet AOA

-          Subscription Sheet MOA ( note that there is requirement to get the above documents notarised and apostilled or else if the promoters travel India on Business VISA and then, Notary & Apostilled requirement will not be there, just we need to attach the Business VISA along)

b. Filing of eForm INC 33 & INC 34

-          We shall draft MOA & AOA of the company and file the same along with Spice 32

-          Subscription Sheet AOA (Notary +Apostilled)

-           Subscription Sheet MOA (Notary +Apostilled)

c. Applying for PAN & TAN

-          Only DSC needs to be affixed on the form and PAN & TAN shall be applied

d. Opening of Bank account

e. FDI in Bank Account

The Subscribers are required to invest the subscription amount in their currency into the bank account of Company within 60 days of Registration, otherwise penal actions be attracted

f. Filing of Advance Reporting form at ebiz portal

-AD bank will issue us FIRC upon KYC be completed.

-Documents required -

-Declaration and other forms for signing by the Investor

g. Filing of Form FC GPR

-Board Resolution

- FIRC

- CA Certificate

- CS Certificate

In case of any queries, please contact CS Neha Seth at 9871903449 or email us at csnehaseth@gmail.com