Wholly Owned Subsidiary in India

Wholly Owned Subsidiary in India for Foreign Companies

Establish a Wholly Owned Subsidiary in India with end-to-end support for company incorporation, FDI, FEMA, tax registrations and regulatory compliance.

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Establish Your Wholly Owned Subsidiary in India with Confidence

A Wholly Owned Subsidiary (WOS) in India is one of the most commonly used structures for foreign companies planning long-term commercial operations in India. It allows the foreign parent to establish a separate Indian legal entity with up to 100% foreign ownership, subject to the applicable FDI Policy and sector-specific conditions.

Unlike a Branch Office or Liaison Office, a subsidiary company can undertake a wide range of commercial activities, generate revenue within India, enter into contracts, own assets, hire employees, and expand its operations with greater operational flexibility.

Setting up a wholly owned subsidiary requires compliance with the Companies Act, 2013, Foreign Exchange Management Act (FEMA), FDI regulations, RBI reporting requirements, tax registrations and other applicable regulatory requirements.

At EzyBiz India Consulting LLP, we provide comprehensive support to foreign investors throughout the incorporation journey. From selecting the appropriate business structure and obtaining regulatory registrations to post-incorporation compliance, accounting, taxation, payroll, FEMA reporting, and corporate advisory, our experienced professionals help international businesses establish and grow their presence in India efficiently and compliantly.

A wholly owned subsidiary is commonly considered as the legal structure for establishing a Global Capability Centre in India, subject to the applicable FDI, tax and regulatory requirements.

Subsidiary Company Registration in India

Subsidiary company registration in India enables a foreign investor to establish an Indian company with a separate legal identity and limited liability. Foreign ownership of up to 100% is permitted in many sectors, subject to the applicable FDI Policy, entry route and sector-specific conditions.

The incorporation process involves company registration with the Ministry of Corporate Affairs (MCA), appointment of directors, subscription to share capital, registered office documentation and subsequent FEMA/FDI reporting, wherever applicable.

Wholly Owned Subsidiary in India at a Glance

Particulars	Details
Business Structure	Private Limited Company, generally  incorporated as an Indian subsidiary under the Companies Act, 2013
Ownership	Up to 100% foreign ownership permitted in many sectors under the FDI Policy, subject to applicable regulations
Legal Status	Separate legal entity distinct from its foreign parent company
Liability	Limited to the unpaid amount on shares subscribed by shareholders
Permitted Activities	Can undertake manufacturing, trading, services, consultancy, exports, imports, e-commerce, R&D and other lawful business activities, subject to sector-specific regulations
Minimum Directors	Two directors (at least one resident director as required under the Companies Act, 2013)
Minimum Shareholders	Two shareholders (individuals or corporate entities, subject to applicable laws)
Registered Office	Mandatory registered office address in India
FDI Compliance	FEMA reporting and RBI filings, wherever applicable
Typical Incorporation Timeline	Approximately 2–4 weeks (subject to document availability and regulatory approvals, if any)
Post-Incorporation Compliance	MCA filings, FEMA reporting, accounting, taxation, GST, payroll, annual audit and other statutory compliances

What is a Wholly Owned Subsidiary in India?

A Wholly Owned Subsidiary (WOS) in India is an Indian company whose share capital is wholly owned, directly or indirectly, by a foreign parent or foreign investors, subject to the applicable FDI Policy and sector-specific conditions.

It is a separate legal entity from its foreign parent and can generally undertake permitted commercial activities, enter into contracts, hire employees, own assets, open bank accounts and earn revenue in India.

A WOS is governed primarily by the Companies Act, 2013, FEMA, FDI regulations and applicable tax and regulatory laws. Depending on the sector and ownership structure, foreign investment may be permitted under the automatic route or may require prior government approval.

For most international businesses planning a long-term presence in India, a Wholly Owned Subsidiary offers the ideal balance of ownership, operational flexibility, credibility, and limited liability, making it the preferred business structure for foreign investment.

Did You Know?

In many sectors, foreign investors can establish a 100% foreign-owned subsidiary in India through the Automatic Route, without requiring prior Government approval, subject to compliance with the applicable FDI policy and FEMA regulations.

Why Foreign Companies Choose a Wholly Owned Subsidiary in India

Foreign companies generally choose a Wholly Owned Subsidiary in India when they want long-term operational control, the ability to undertake commercial activities and a scalable legal presence in the Indian market.

Compared with representative-office structures such as  a Branch Office, Liaison Office, or Project Office,  a subsidiary provides greater flexibility for conducting business, hiring employees, entering into contracts and expanding operations, subject to applicable laws and sector-specific regulations.

Complete Ownership and Management Control

Eligible foreign investors may hold up to 100% equity in an Indian subsidiary, subject to the applicable FDI Policy and sector-specific conditions. This enables the foreign parent to retain control over management, operations, business strategy and key commercial decisions without requiring a local equity partner in many sectors.

Separate Legal Entity with Limited Liability

A Wholly Owned Subsidiary is a separate legal entity incorporated under the Companies Act, 2013. Its assets, liabilities, rights and obligations are distinct from those of the foreign parent, and shareholder liability is generally limited to the unpaid amount on shares.

Freedom to Undertake Commercial Activities

A Wholly Owned Subsidiary can undertake a broad range of permitted commercial activities in India, including manufacturing, trading, services, consultancy, technology, research and development, imports, exports and e-commerce, subject to the applicable FDI Policy and sector-specific regulations.

Enhanced Business Credibility

Operating through an Indian subsidiary can enhance credibility with customers, suppliers, financial institutions, government authorities and business partners. It can also facilitate participation in commercial contracts, tenders and long-term business relationships in India.

Access to India’s Expanding Market

A Wholly Owned Subsidiary enables foreign companies to establish a direct presence in India and access its large consumer market, skilled workforce, expanding infrastructure and growing digital economy. It provides a platform for building local operations and pursuing long-term business opportunities.

Scalable Structure for Future Growth

A Wholly Owned Subsidiary provides flexibility to expand operations as the business grows. The company can increase capital, open additional offices, hire employees, enter into strategic arrangements and restructure its operations, subject to applicable corporate, tax and regulatory requirements.

Strong Intellectual Property and Brand Protection

An Indian subsidiary can own, use and protect trademarks, copyrights, patents, domain names, software and other intellectual property in India, subject to applicable laws. This can help the foreign parent maintain greater control over its brand and intellectual property while operating in the Indian market.

Long-Term Investment Platform

A Wholly Owned Subsidiary provides a stable legal structure for foreign companies planning long-term investment and business continuity in India. It also offers flexibility for future expansion, restructuring, joint ventures, acquisitions or fundraising, subject to applicable laws and regulatory requirements.

Wholly Owned Subsidiary vs Branch Office vs Liaison Office vs Project Office

Foreign companies entering India can choose from several business structures depending on their commercial objectives, investment plans, and regulatory requirements.

While each structure serves a different purpose, a Wholly Owned Subsidiary (WOS) is generally the preferred choice for businesses planning long-term operations, revenue generation, and business expansion in India.

The following comparison provides a quick overview of the key differences:

COMPARISON TABLE

Particulars	Wholly Owned Subsidiary	Branch Office	Liaison Office	Project Office
Legal Status	Separate legal entity	Extension of foreign company	Extension of foreign company	Temporary extension of foreign company
Ownership	Up to 100% foreign ownership (subject to FDI policy)	Owned by foreign company	Owned by foreign company	Owned by foreign company
Commercial Activities	✔ Permitted	✔ Restricted to RBI-approved activities	✖ Not permitted	✔ Limited to approved project
Revenue Generation in India	✔ Yes	✔ Yes (permitted activities only)	✖ No	✔ Only from project
Manufacturing & Trading	✔ Permitted (subject to applicable laws)	Generally not permitted	✖ Not permitted	✖ Project-specific only
Contracts with Indian Customers	✔ Yes	✔ Yes	✖ No	✔ Project-related only
Separate Legal Identity	✔ Yes	✖ No	✖ No	✖ No
Limited Liability	✔ Yes	✖ Liability extends to parent company	✖ Liability extends to parent company	✖ Liability extends to parent company
FDI Investment	✔ Through share capital	Not applicable	Not applicable	Not applicable
Business Expansion	✔ Highly scalable	Limited	Very limited	Limited to project duration
Best Suited For	Long-term business operations	Existing overseas businesses providing specific services	Market research, promotion and business development	Execution of a specific contract or project

Explore Other India Market Entry Options:

• Branch Office in India | • Liaison Office in India | • Project Office in India | • Joint Venture in India

Which Business Structure is Right for You?

The right business structure depends on your commercial objectives, investment strategy, and long-term plans in India.

• Choose a Wholly Owned Subsidiary if you intend to establish a long-term presence, undertake commercial activities, hire employees, generate revenue, and expand your business in India.
• Choose a Branch Office if your foreign company wishes to carry out only the specific activities permitted under RBI regulations without incorporating a separate Indian company.
• Choose a Liaison Office if your objective is limited to market research, promoting the parent company’s business, or acting as a communication channel without undertaking commercial operations.
• Choose a Project Office if your company has secured a specific project in India and requires a temporary establishment solely for executing that project.

Why Most Foreign Investors Prefer a Wholly Owned Subsidiary

For businesses looking to build a sustainable and scalable presence in India, a Wholly Owned Subsidiary offers the greatest operational flexibility, complete ownership, limited liability, and the ability to conduct a broad range of commercial activities. These advantages make it the preferred entry vehicle for multinational corporations, technology companies, manufacturers, trading businesses, and service providers investing in India.

Eligibility for Setting Up a Wholly Owned Subsidiary in India

Most foreign companies and foreign nationals can establish a Wholly Owned Subsidiary in India, subject to the applicable provisions of the Companies Act, 2013, the Foreign Exchange Management Act (FEMA), the Consolidated FDI Policy, and sector-specific regulations.

While many sectors permit 100% foreign ownership through the Automatic Route, certain industries require prior approval from the Government of India.

To establish a wholly owned subsidiary, the following key eligibility requirements should generally be satisfied:

Foreign Shareholders

A foreign company, foreign individual, overseas body corporate, or other eligible foreign investor may hold shares in an Indian subsidiary, subject to the applicable FDI policy and FEMA regulations.

Minimum Directors

A Private Limited Company must have a minimum of two directors, of whom at least one must qualify as a Resident Director under the Companies Act, 2013.

Minimum Shareholders

A minimum of two shareholders is required for incorporation. The shareholders may be foreign individuals, foreign corporate entities, or a combination thereof, subject to applicable laws.

Registered Office in India

The company must maintain a registered office address in India for receiving statutory communications and maintaining prescribed records.

Permitted Business Activities

The proposed business activities must comply with India’s FDI Policy. Certain sectors permit automatic foreign investment, while others require prior Government approval or are subject to sector-specific conditions.

Capital Requirement

There is generally no prescribed minimum paid-up capital for incorporating a wholly owned subsidiary under the Companies Act, 2013. However, the capital should be commercially adequate considering the proposed business operations and applicable regulatory requirements.

Compliance with FEMA and RBI Regulations

Foreign investment received by the subsidiary must comply with FEMA, pricing guidelines, reporting requirements, and other regulatory compliances prescribed by the Reserve Bank of India and the Ministry of Finance.

Planning to Set Up a Wholly Owned Subsidiary?

Before incorporating a company in India, it is advisable to evaluate the applicable FDI route, sector-specific conditions, tax implications, and ongoing compliance requirements. Proper planning at the incorporation stage helps foreign investors avoid regulatory challenges and ensures a smooth business setup process.

Documents Required for Wholly Owned Subsidiary Registration in India

The documents required for setting up a Wholly Owned Subsidiary in India depend on whether the foreign shareholder is an individual or a corporate entity, the nationality of the proposed directors and the proposed registered office in India.

Foreign documents generally need to be notarised and apostilled or consularised, as applicable in the country where they are executed.

Documents from Foreign Shareholders

• Passport of individual shareholder(s), or Certificate of Incorporation of the foreign corporate shareholder
• Address proof of individual shareholder(s), where applicable
• Board Resolution approving the investment in the Indian subsidiary, for corporate shareholders
• Constitutional documents of the foreign corporate shareholder
• Shareholding / ownership details, wherever required
• KYC and other information required for incorporation and foreign investment reporting

Documents from Directors

• Passport
• Address proof
• Recent passport-size photograph
• Email address and mobile number
• Basic personal details required for DIN and incorporation
• Other KYC documents or information, wherever applicable

Documents for Indian Registered Office

• Rent / lease agreement, where the premises are rented
• Latest utility bill / electricity bill for the premises
• NOC from the owner / landlord permitting use of the premises as the company’s registered office
• Ownership proof, where applicable
• Other address-related documents or information required for incorporation

Other Information/ Documents Required

• Proposed business activities
• Proposed shareholding and investment structure
• Proposed authorised and paid-up capital
• Proposed company name(s)
• Trademark authorisation, where applicable
• Sector-specific approvals or information, wherever required
• Other information required based on the proposed business and ownership structure

Step-by-Step Process for Wholly Owned Subsidiary Registration in India

Setting up a Wholly Owned Subsidiary in India involves company incorporation, foreign investment compliance, banking and post-incorporation registrations. The exact process may vary depending on the ownership structure, business activity, FDI route and sector-specific requirements.

Step 1 – Business Structure Consultation

Evaluate the proposed business model, FDI eligibility, investment structure, and regulatory requirements.

Step 2 – Obtain Digital Signature Certificates (DSC)

Digital Signatures are obtained for the proposed directors to facilitate electronic filing with the Ministry of Corporate Affairs (MCA).

Step 3 – Director Identification Number (DIN)

DIN is allotted to the proposed directors during the incorporation process.

Step 4 – Company Name Reservation

Reserve the proposed company name with the Registrar of Companies (ROC).

Step 5 – Incorporation of Company

Preparation and filing of incorporation documents with the ROC under the Companies Act, 2013.

Step 6 – Certificate of Incorporation

Upon approval, the Registrar issues the Certificate of Incorporation along with the Corporate Identification Number (CIN).

Step 7 – PAN, TAN & Bank Account

Obtain PAN, TAN, open the company’s bank account, and complete initial registrations.

Step 8 – Receipt of Foreign Investment

The foreign parent remits the share subscription amount through normal banking channels in accordance with FEMA regulations.

Step 9 – FEMA Reporting & Share Allotment

Complete the share allotment and file the applicable FEMA / RBI reporting forms within the prescribed timelines.

Step 10 – Business Registrations & Operational Setup

Obtain GST registration, Import Export Code (IEC), Shops & Establishment registration, Professional Tax registration (where applicable), and other business-specific licences before commencing operations.

Post-Incorporation FEMA & RBI Compliance

After company incorporation and receipt of foreign investment, the Indian subsidiary must comply with applicable FEMA and RBI reporting requirements. Timely share allotment, foreign investment reporting and maintenance of supporting records are important for ongoing regulatory compliance.

• Receipt of foreign investment through authorised banking channels
• Share allotment within the prescribed timeline
• FEMA / RBI reporting, wherever applicable
• Compliance with applicable pricing and valuation requirements
• Maintenance of statutory and investment records
• Compliance for future capital infusion, share transfers or restructuring

Annual Compliance Requirements for a Wholly Owned Subsidiary

A Wholly Owned Subsidiary in India is required to comply with ongoing corporate, tax, accounting, labour and FEMA requirements after incorporation. The exact compliances depend on the company’s activities, transactions and regulatory profile.

• Board and shareholders’ meetings
• Annual financial statements and statutory audit
• Annual ROC filings
• Income-tax and TDS compliance
• GST compliance, where applicable
• FEMA / RBI reporting, where applicable
• Payroll and labour law compliance
• Maintenance of statutory records
• Transfer pricing compliance, where applicable

Companies planning a wholly owned Indian subsidiary may also review our Business Setup Services in India for support with entity structuring, incorporation, FDI, taxation, payroll and ongoing compliance.

Frequently Asked Questions About Wholly Owned Subsidiary in India

1. What is a Wholly Owned Subsidiary in India?

A Wholly Owned Subsidiary (WOS) is an Indian company incorporated under the Companies Act, 2013, in which the entire share capital is owned by a foreign company or eligible foreign investors, subject to India’s Foreign Direct Investment (FDI) policy and applicable regulations.

2. Can a foreign company own 100% of an Indian subsidiary?

Yes. In many sectors, foreign investors can own up to 100% of an Indian subsidiary through the Automatic Route under the FDI Policy. However, certain sectors require prior Government approval or are subject to sector-specific conditions.

3. Is RBI approval required for setting up a Wholly Owned Subsidiary?

Generally, prior RBI approval is not required where foreign investment is permitted under the Automatic Route. However, the company must comply with FEMA reporting requirements after receiving foreign investment. Certain sectors may require Government approval before investment.

4. What is the difference between a Wholly Owned Subsidiary and a Branch Office?

A Wholly Owned Subsidiary is a separate legal entity incorporated in India and can undertake a wide range of commercial activities. A Branch Office is an extension of the foreign company and is permitted to undertake only specified activities in accordance with RBI regulations.

5. How long does it take to register a Wholly Owned Subsidiary in India?

The incorporation process generally takes 2 to 4 weeks, depending on document readiness, regulatory approvals (if applicable), and the timely completion of statutory formalities.

6. What is the minimum capital required for a Wholly Owned Subsidiary?

There is no prescribed minimum paid-up capital under the Companies Act, 2013. However, the capital should be sufficient for the proposed business operations and comply with any applicable sector-specific requirements.

7. How many directors are required to incorporate a Wholly Owned Subsidiary?

A Private Limited Company must have at least two directors, and at least one director must qualify as a Resident Director under the Companies Act, 2013.

8. Can all directors be foreign nationals?

Foreign nationals can be appointed as directors. However, at least one director must satisfy the statutory requirement of being a Resident Director in India.

9. Can a foreign company be the shareholder of an Indian subsidiary?

Yes. A foreign company can hold shares in an Indian subsidiary, subject to the applicable FDI policy, FEMA regulations, and sector-specific conditions.

10. What documents are required for subsidiary company registration in India?

The documents for generally include passports or incorporation documents of foreign shareholders, address proof, board resolutions (for corporate shareholders), registered office proof in India, and other incorporation documents. Additional documents may be required depending on the ownership structure and business activity.

11. Can a Wholly Owned Subsidiary undertake manufacturing and trading activities?

Yes. Subject to the applicable FDI policy and sector-specific regulations, a Wholly Owned Subsidiary can undertake manufacturing, trading, service, consultancy, technology, research, import, export, and other lawful business activities.

12. Is GST registration mandatory after incorporation?

GST registration is required if the company meets the prescribed registration thresholds or undertakes activities where registration is mandatory under the GST laws, such as interstate taxable supplies or exports.

13. What FEMA compliances are applicable after receiving foreign investment?

After receiving foreign investment, the company must comply with FEMA reporting requirements, complete share allotment within the prescribed timeline, and file the applicable RBI reporting forms through the designated online reporting system.

14. Can profits be repatriated to the foreign parent company?

Yes. Subject to applicable tax laws, FEMA regulations, and completion of statutory compliances, dividends and other eligible payments may be repatriated to the foreign parent company through authorised banking channels.

15. Can a Wholly Owned Subsidiary purchase property in India?

A Wholly Owned Subsidiary can acquire property required for its business operations, subject to applicable FEMA provisions, local laws, and regulatory requirements.

16. What annual compliances are required for a Wholly Owned Subsidiary?

Annual compliances generally include ROC filings, statutory audit, income tax return, GST returns (where applicable), TDS compliance, maintenance of statutory registers, Board Meetings, shareholder meetings, payroll compliance, and other applicable regulatory filings.

17. Can a Wholly Owned Subsidiary employ foreign and Indian employees?

Yes. A Wholly Owned Subsidiary may employ both Indian and foreign nationals, subject to applicable employment laws, immigration requirements, and visa regulations.

18. Can a Wholly Owned Subsidiary later raise investment from other investors?

Yes. Subject to the Companies Act, FEMA regulations, shareholder approvals, and other applicable laws, a subsidiary may issue shares to new domestic or foreign investors in the future.

19. Why is a Wholly Owned Subsidiary the preferred business structure for foreign companies?

A Wholly Owned Subsidiary provides complete ownership, limited liability, operational flexibility, greater market credibility, the ability to undertake commercial activities, and a scalable platform for long-term business expansion in India.

Country-Specific India Market Entry Pages

We have prepared dedicated India market entry pages to help overseas businesses understand the regulatory, tax and commercial considerations applicable to their jurisdiction. Explore our country-specific guides below:

• India Market Entry Services for Chinese Companies
• India Market Entry Services for Taiwanese Companies
• India Market Entry Services for US Companies
• India Market Entry Services for UK Companies
• India Market Entry Services for Australian Companies
• India Market Entry Services for Japanese Companies
• India Market Entry Services for Singapore Companies

Related India Entry Services

• India Market Entry Consulting 
• Foreign Company Registration in India
• Branch Office in India
• Liaison Office in India
• Project Office in India
• Joint Venture Registration in India
• Business setup services in India

About EzyBiz India Consulting LLP

EzyBiz India Consulting LLP is a multidisciplinary advisory firm assisting foreign companies, overseas investors and multinational groups with India market entry, wholly owned subsidiary registration, FDI and FEMA advisory, taxation and ongoing regulatory compliance.

Foreign-owned subsidiaries operating from Delhi can also access our Chartered Accountant Services in Delhi for accounting, GST, income tax, ROC compliance, audit and ongoing regulatory support.

Last Updated: August 2026

Disclaimer

The information provided on this page is for general informational purposes only and should not be considered legal, tax or regulatory advice. The requirements for setting up and operating a Wholly Owned Subsidiary in India may vary depending on the nature of business activities, sector, ownership structure, foreign investment route and applicable regulations. Professional advice should be obtained based on the specific facts and circumstances before taking any decision.