There are lot of opportunities to the Foreign Companies to start business in India as India being one of the largest and fastest growing market. In case the foreign corporation has plans to operate in India on a full-fledged scale, they can incorporate an Indian Subsidiary.
A Foreign National (other than a citizen of Pakistan or Bangladesh) or an entity incorporated outside India (other than entity incorporated in Pakistan or Bangladesh) can invest and own a Company in India by acquiring shares of the company (existing Indian company), subject to the FDI Policy of India. In addition, a minimum of one Indian Director (Resident in India) is required for incorporation of an Indian Company along with an address in India.
Advantages of Indian Subsidiary Company
Separate Legal Entity: A Company is Separate legal entity and artificial person established under the Act. If the company suffers from any loss and faces financial distress because of primary business activity, the personal assets of shareholders / Members / Directors will not be at risk of being seized by banks, creditors, and government. They are not personally liable.
Foreign Direct Investment: 100% Foreign Direct Investment (FDI) is allowed in many of the sectors through multiple business entities (like LLP, Public or Private) without any prior approval from the Government.
Brand Value of the Company: Brand Value of the Company will get increased because employees feel secure in joining the company, vendor feels secure in offering credit, investor feels secure in investing and the customer feels trust & confidence in brand. This all makes big shape of the company and ensure to become a multinational company.
Owning Property: Being an Artificial Person, the Company can enjoys the right to own and transfer property in its name. No shareholder can make any claim upon the property of the company so long as the company is still running.
