<\/p>\n
Setting up a subsidiary is the most common way for a foreign company to establish a real, revenue-earning presence in India. A wholly owned subsidiary (WOS)<\/strong> \u2014 an Indian private limited company owned 100% by the foreign parent \u2014 gives you a separate legal entity, limited liability, and clean FEMA compliance. This guide walks through exactly how to register one in 2026: the documents, the FDI route, the timeline, the mandatory RBI filing, and what it costs.<\/p>\n If you already know the structure you want and just need the numbers, you can jump straight to our foreign subsidiary setup cost estimator<\/a> for an itemised figure.<\/p>\n A WOS is an Indian company incorporated under the Companies Act 2013 in which a foreign company holds the entire shareholding (directly, or with a nominee holding a single share to meet the two-shareholder minimum). Unlike a branch or liaison office, a WOS is a separate Indian legal entity<\/strong> \u2014 it can earn income, sign contracts, hire employees, raise equity and repatriate profits, while shielding the parent from Indian liabilities.<\/p>\n Most foreign companies entering India for long-term operations choose a WOS over a branch, liaison or project office. If you’re still deciding, a comparison of India entry structures helps \u2014 but for building an actual India business, the WOS is almost always the right call.<\/p>\n In most sectors, 100% FDI is permitted under the automatic route<\/strong>, meaning no prior government approval is needed. A minority of sectors have caps or require government approval \u2014 for example multi-brand retail, defence, insurance, telecom, print media and broadcasting. A few are prohibited outright (lottery, gambling, chit funds, Nidhi companies, atomic energy). Investors from Pakistan and Bangladesh require prior government security clearance for all<\/strong> sectors.<\/p>\n The single most important thing to confirm before you invest is your sector’s FDI route and cap. Get this wrong and the whole timeline changes.<\/p>\n From the parent company<\/strong> (all notarised and apostilled in the home country \u2014 or attested by the Indian embassy if the country isn’t a Hague Convention member):<\/p>\n From each proposed director:<\/strong><\/p>\n For the Indian registered office:<\/strong> proof of address (a recent utility bill) and a no-objection certificate from the premises owner. A virtual office is acceptable for registration.<\/p>\n Every Indian company must have at least one director who is resident in India<\/strong> \u2014 someone who has stayed in India for 182 days or more in the previous financial year (Section 149(3)). A foreign WOS typically meets this by hiring an Indian country manager as director, appointing a professional nominee resident director, or relocating a parent-company employee. Plan for this early; it’s a common last-minute blocker.<\/p>\n Step 1 \u2014 Name reservation & DSC (3\u20137 days).<\/strong> Reserve the company name via the MCA’s RUN or SPICe+ Part A, and obtain Class-3 DSCs for the directors. Apostilled passports are needed for foreign directors’ DSCs.<\/p>\n Step 2 \u2014 Incorporate via SPICe+ (7\u201315 days).<\/strong> File the SPICe+ form with the MoA, AoA and subscriber sheet signed by the foreign parent. PAN and TAN are allotted automatically with the certificate of incorporation. Note that incorporation carries zero MCA filing fee for authorised capital up to \u20b915 lakh<\/strong> \u2014 you can check the exact government fees on our MCA fee calculator<\/a>.<\/p>\n Step 3 \u2014 FDI inflow & FC-GPR (15\u201330 days).<\/strong> The parent remits the share capital through banking channels and obtains a Foreign Inward Remittance Certificate (FIRC). You must then file Form FC-GPR with the RBI through your AD bank within 30 days of share allotment<\/strong> to report the FDI. This is the single most-missed FEMA deadline \u2014 a delay triggers a compounding application and penalty.<\/p>\n Step 4 \u2014 Commencement, bank account & registrations (30\u201360 days).<\/strong> File Form INC-20A (declaration of commencement of business) within 180 days, open a current bank account, appoint a statutory auditor (Form ADT-1), and register for GST if applicable.<\/p>\n Working end to end, most subsidiaries are fully set up \u2014 including FC-GPR \u2014 within about 6 to 8 weeks<\/strong> of engagement. The main variable is how quickly the home-country documents are apostilled.<\/p>\n A WOS files the same annual compliances as any Indian private limited company, plus FEMA requirements:<\/p>\n Total first-year cost is the sum of government fees, professional\/CA fees, apostille costs, a registered office, FC-GPR filing and first-year compliance. It varies with your investment size, sector and the state of registration. Rather than quote a single number, use our foreign subsidiary setup cost estimator<\/a> \u2014 it produces an itemised breakdown for your exact situation, or talk to a TAXAJ FEMA specialist<\/a> for a fixed quote.<\/p>\n Once the parent’s documents are apostilled and the directors’ KYC is ready, incorporation typically completes in about 2\u20134 weeks, and the full process including FC-GPR in around 6\u20138 weeks. The main variable is the speed of legalising home-country documents.<\/p>\n Yes. Foreign nationals can be directors and hold shares, but the company must have at least one director resident in India (182+ days in the previous financial year). A nominee resident director can be arranged if needed.<\/p>\n The two key ones are FC-GPR \u2014 reporting the FDI to the RBI within 30 days of allotting shares \u2014 and the annual FLA return, due by 15 July each year. Missing these attracts penalties under FEMA 1999.<\/p>\n Yes. After Indian taxes, profits can be freely repatriated under FEMA through dividends, royalties or technical fees, subject to withholding tax and Form 15CA\/15CB. There is no lock-in on dividend repatriation.<\/p>\n TAXAJ is a chartered-accountancy and FEMA advisory firm that has helped 50+ foreign companies set up subsidiaries, branch and liaison offices in India \u2014 end to end, from incorporation and FC-GPR to annual compliance. Estimate your setup cost<\/a> or book a consultation<\/a>.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":" Setting up a subsidiary is the most common way for a foreign company to establish a real, revenue-earning presence in India. A wholly owned subsidiary (WOS) \u2014 an Indian private limited company owned 100% by the foreign parent \u2014 gives you a separate legal entity, limited liability, and clean FEMA compliance. This guide walks through…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_kad_post_transparent":"","_kad_post_title":"","_kad_post_layout":"","_kad_post_sidebar_id":"","_kad_post_content_style":"","_kad_post_vertical_padding":"","_kad_post_feature":"","_kad_post_feature_position":"","_kad_post_header":false,"_kad_post_footer":false,"_kad_post_classname":"","footnotes":""},"categories":[14,2],"tags":[],"class_list":["post-992","post","type-post","status-publish","format-standard","hentry","category-fema-fdi","category-launch-business"],"_links":{"self":[{"href":"https:\/\/www.taxaj.com/learn\/wp-json\/wp\/v2\/posts\/992","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.taxaj.com/learn\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.taxaj.com/learn\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.taxaj.com/learn\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.taxaj.com/learn\/wp-json\/wp\/v2\/comments?post=992"}],"version-history":[{"count":1,"href":"https:\/\/www.taxaj.com/learn\/wp-json\/wp\/v2\/posts\/992\/revisions"}],"predecessor-version":[{"id":993,"href":"https:\/\/www.taxaj.com/learn\/wp-json\/wp\/v2\/posts\/992\/revisions\/993"}],"wp:attachment":[{"href":"https:\/\/www.taxaj.com/learn\/wp-json\/wp\/v2\/media?parent=992"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.taxaj.com/learn\/wp-json\/wp\/v2\/categories?post=992"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.taxaj.com/learn\/wp-json\/wp\/v2\/tags?post=992"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}What is a wholly owned subsidiary (WOS)?<\/h2>\n
Is 100% foreign ownership allowed?<\/h2>\n
Documents you’ll need<\/h2>\n
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The resident director requirement<\/h2>\n
Step-by-step: registering your WOS<\/h2>\n
Ongoing compliance (don’t overlook this)<\/h2>\n
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How much does it cost?<\/h2>\n
Frequently asked questions<\/h2>\n
How long does it take to register a foreign subsidiary in India?<\/h3>\n
Can a foreign national be a director of an Indian subsidiary?<\/h3>\n
Which FEMA filings must a foreign subsidiary complete?<\/h3>\n
Can profits be repatriated to the parent abroad?<\/h3>\n
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