Start-up of Foreign Business in India

The procedure for foreign company registration in India begins by selecting a type of company to enter the Indian market or start business operations in India. There are the following two ways:

1. Registration of a company
2. Setting up a Liaison Office or Representative/Project Office or a Branch Office of the foreign company

For the foreign company registration in india, the investor must firstly, decide the type of company (Private Ltd. or Public Ltd.). A private limited company offers limited liability or the legal protection for its shareholders but this adds certain restrictions on its ownership and also enjoys the privileges given over public company as per the Companies Act, 2013 whereas a public limited company is whose stocks are traded in a stock exchange and can be sold and bought by anyone (public) and requires following numerous rules and regulations as per the Companies Act, 2013.

Therefore, incorporating a private limited company is the easiest and the fastest way of setting up a foreign business in India. Similarly, when a foreign company brings in 100% FDI through automatic route in India, it becomes Wholly Owned Subsidiary Company of that Foreign Company. In this case, it becomes an entity whose whole share capital is owned by that foreign company. So, it can be a private company which is limited by guarantee or limited by shares or by unlimited liability company.