Overview of Indian Subsidiary Registration
Foreign companies have interest to start their operations in India as it is one of the largest and fast-growing markets in the world. A Foreign National other than a citizen of Pakistan or Bangladesh or an entity incorporated outside India can make investment and can own their subsidiary company in India by acquiring shares subject to the FDI Policy of India. There is a minimum requirement of one Indian Director who must be Indian Resident and one is to be Foreign Director, which is needed for incorporation of an Indian Subsidiary Company.
Subsidiary Company Registration is governed by the Companies Act 2013. It defines a subsidiary as a company in which a foreign corporate body or parent company owns minimum 50% of the entire share capital. The parent company is the one wholly or partially having a control over a subsidiary company. Subsidiary companies must follow the laws of the country in which they are set up and running. Therefore, if the foreign subsidiary is incorporated in India, then it must follow the law in force in India.