Welcome to India!
Set up a company in Bangalore!

India is fast becoming a global leader in business. We are the 6th largest economy and boast of consumer base unlike any in the world! None of this would have been possible without amazing people like yourself who wish to invest in India. So thank you! Thank you for your faith in us. We promise you that India will not let you down!

If you are reading this, we know that you want to set up your dream venture in India. You must have heard many things about doing business in India (psst! we know not all that you’ve heard is great 🙂) So we know that you are bursting with questions! Worry not for BCL India is here to help.

 

In the following sections we shall help you understand

  • Why choose India as your preferred business destination & what’s so special about Bangalore?
  • What are the steps involved in setting up a subsidiary in India?
  • What should you do once your subsidiary is set up in India?

We, at BCL India, would be delighted to help you with any further questions that you may have. Please do not hesitate to reach out to us.

Without further ado… let’s dive in!

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We are the fastest growing economy amongst the BRICS nations! This year, we jumped 30 places up on the 'Ease of Doing Business' ranking and we are just warming up!

Why Invest in India?

India offers unparalleled global competitive advantage. We are one rank shy of the top 5 mega economies of the world. India also offers a definitive cost advantage and a rich talent pool to choose from.

A stable political environment that is motivated to welcome investment into India helps matters greatly. Our emerging middle class is our pride and we are one of the largest & most innovative startup ecosystems in the world.

BCL India welcomes you to the Most Dynamic City in the world! And for the records, we beat Silicon Valley, Shanghai and Dubai to get there!

Advantage Bangalore!

Bangalore is just as famous for its technology talent pool as it is for its startups.
"Lauded as the Silicon Valley of India, Bengaluru is the No. 2 hub for business innovation in the Asia - Pacific region" said the Inc. magazine

On an average 20 businesses take birth each day in Bangalore. World class facilities are abundant with global leaders like IISC and IIM making Bangalore their home.
What better place to start than the most cosmopolitain city of India? Welcome home!

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Now that you're on board to invest in Bangalore, it is important we tell you about the two popular business structures - Private Limited Companies (PLC) & Limited Liability Partnerships (LLPs)

The Best Business Structure

PLCs are regulated by the Companies Act 2013. Setting up a PLC could take anywhere between 1 day - 2 weeks.
In most sectors, PLCs can be 100% owned by non-Indian shareholders. This is the most popular route adopted to set up Indian subsidiaries.

LLPs are fast catching up too! Like PLCs, they too enjoy the benefits that come with limited liability structures.
100% foreign investment is allowed in LLPs and in some respects, they could offer you a better tax advantage.

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No investment decision can be made without understanding the tax regime of the host country. India is on the path of minimising tax rates to make businesses competitive.

3 magic letters... T.A.X

PLC income tax rates were recently brought down to 25%* LLPs continue to be taxed at 30%.
India also provides income tax incentives to businesses engaged in Research & Development. Further, businesses set up in SEZs enjoy 15 years of tax holiday**

GST was introduced in 2017 and brought within its fold multiple indirect taxes. The theme is simple 'One Nation. One Tax'
The benefits of GST are starting to become visible. Exports are zero-rated with full refund on taxes paid on inward supplies.

* ah! the dreaded * ... conditions, of course, apply

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Shareholders are owners of the PLC whereas Directors manage the operations of the company. Corporations can be shareholders of a PLC but Directorship can be held only by natural persons.
Every person who intends to become a Director should posses a Director Identification Number (DIN) and a Digital Signature Certificate (DSC)
BCL India can help you obtain DIN and DSC.
In the absence of your representative in India, we also provide Resident Director services.
Laying the foundation

A PLC can be set up with minimum 2 shareholders and 2 directors, one of whom should be a Resident Indian. In most sectors, 100% foreign shareholding is permitted, i.e. both shareholders can be non-Indians. Further, shares can be held by individuals or by corporations.

Foreign investment into capital is popularly referred to as Foreign Direct Investment (FDI). In most sectors, including IT & ITeS, no prior government approval is needed before such investment. Post-facto declarations would however be required.
Unlike FDI, borrowings from outside India, referred to as External Commercial Borrowings (ECB) require prior approval from the Reserve Bank of India.
BCL India assists several foreign subsidiaries comply with the entire specturm of regulations around FDI & ECB, including post-facto filings and prior government approvals across all sectors.
Funding the company

Funds can be introduced into the PLC towards share capital, either equity (i.e. ordinary shares) or preference (i.e. preferred stock).
A PLC can also accept loans from sources within India or from abroad in the form of External Commercial Borrowings.
Finally, PLCs can also accept advance against services to be rendered in the future.

MoA broadly defines the capital structure, the business objectives of the PLC, its registered office and establishes its limited liability.
AoA lays down all the guidelines for the management of the PLC, the responsibilities of the directors, and the powers of shareholders.
Previously, MoA and AoA had to be manually submitted. Today, these forms are submitted electronically through e-MoA (INC-33) and e-AOA forms (INC-34)
BCL India will help you lay down the right framework for your PLC to ensure smooth operations once your business goes live. We shall also file e-MOA and e-AoA for setting up the PLC.
The Operational Framework

Every PLC has to operate within the framework that its shareholders establish at the time it is set up. This framework is formally documented in two documents
(a) Memorandum of Association,
(b) Articles of Association

While the MoA operates as the charter of the PLC defining how it transacts with outsiders, the AoA defines internal rules and regulations.

Every PLC in India needs to have a unique name. Where the Indian PLC is a subsidiary of a foreign company, the name of the company should necessarily have the same name as its parent company. The proposed name could be rejected by the Registrar of Companies on account of its similarity with other companies or its familiarity with brands that are trademarked. Rejections leads to additional costs and delays in setting up the PLC.
BCL India can help you choose the right name for your PLC beforehand. Additionally, we shall guide your through the whole process of collating the documents needed to set up the PLC.
Documents to set up the PLC

The documents needed to set up a PLC depend on whether the shareholders are Indian or foreign. Additional documents would also be needed if the directors are non-residents.
These incorporation documents have to attested by the Indian Embassy & in some cases, have to be notarised as well to estasblish their authenticity.
It is also very important that the stakeholders reserve the name of the PLC which needs to be unique.

Permanent Account Number or PAN is the PLC's tax identification number that will be used to file its income tax returns. Tax Deductor and Collector Account Number (TAN) is an identification number used by the PLC to deposit taxes withheld from payments made to employees and vendors.
In addition to these identification numbers under income tax, the PLC has to obtain other licenses to do business. Let's see them now.
BCL India believes in partnering with its clients. We shall be there for you at each step to help you set up your dream venture in India. We welcome you and wish you all the very best!
Final Lap - Timelines, Tax ID

The Ministry of Corporate Affairs (MCA) generally takes between 1 - 7 days to approve of the PLC's incorporation. The process may take longer depending on the applications the MCA has to scrutinise.
MCA may also come back with additional questions or comments which would require timely redressal.
The PLC shall also obtain income tax identification numbers (PAN & TAN) together with the Incorporation certificate.

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Get your business off the blocks!

Once the subsidiary is incorporated, licenses have to be obtained to make it functional. These licenses depend on the nature of business the subsidiary conducts.
For example, a subsidiary engaged in foreign trade will have to obtain an Import Export Code. Subsidiaries that engage more than 20 employees have to register under Provident Fund. Almost all businesses have to obtain a GST number. Further, subsidiaries operating through factories have to register under the Factories Act.

Absence of licenses could result in penalties & prohibitions which could significantly impair the ability of the subsidiary to do business.

BCL India specialises in subsidiary set up services identifying all licenses needed by your subsidiary to do business in India setting up a subsidiary in India. We understand how crucial this process is and possess the expertise to liaise with all government departments to secure your business. Our recommendations flow from our vast experience dealing with several businesses.
We shall be glad to assist you!

We love your questions…

Post them here and & we will write back to you with the answers.


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