Foreign Wholly Owned
Subsidiary in India —
100% Yours. No Partner Needed.
Own your India operations entirely. A Wholly Owned Subsidiary gives you complete ownership, full control, and 100% of profits — without any Indian joint venture partner. Mitali Tita, practising Company Secretary in Mumbai, handles your complete WOS setup and FEMA compliance.
A Foreign Wholly Owned Subsidiary (WOS) in India is an Indian company (incorporated under Companies Act 2013) in which a foreign company or individual holds 100% of the equity shares — with no Indian or other external shareholders. It is the most popular India market entry structure because 100% FDI is permitted under the Automatic Route in most sectors, requiring no prior government approval. The WOS is treated as a fully Indian entity for all legal, tax, and regulatory purposes, while the foreign parent retains complete ownership, full operational control, and 100% of profits. After allotting shares to the foreign parent, FC-GPR must be filed with RBI within 30 days, and an annual FLA Return filed by July 15 every year.
What Is a Foreign Wholly Owned Subsidiary?
A Wholly Owned Subsidiary (WOS) is a specific type of subsidiary where the parent company holds exactly 100% of the equity shares — there are no other shareholders, minority investors, or joint venture partners. Every share in the company is owned by the foreign parent.
In India's context, a Foreign WOS is typically incorporated as a Private Limited Company under the Companies Act 2013, with the foreign company listed as the sole subscriber to the Memorandum of Association. The foreign parent receives 100% of the subscribed shares upon incorporation and capital infusion.
Unlike a joint venture (where control and profits are shared with an Indian partner), a WOS gives the foreign parent complete strategic autonomy — every business decision, every rupee of profit, every piece of intellectual property, and every aspect of brand management remains entirely under the parent's control.
India's FDI Policy permits 100% foreign ownership under the Automatic Route in most sectors — making WOS the default India entry choice for most multinational companies, tech firms, manufacturers, and service providers.
WOS vs Joint Venture — Why 100% Ownership Changes Everything
The fundamental difference between a WOS and a joint venture is ownership — and that single number (100% vs less) changes everything about how you run your India business.
Every share. Every decision.
Every rupee of profit. Yours alone.
Sectors Where 100% WOS Is Permitted Under Automatic Route
These sectors allow foreign companies to set up a 100% WOS in India with no prior government approval. Always confirm current policy before investing — Mitali Tita provides a written FDI eligibility report.
Technology companies, software development, IT-enabled services, BPO, KPO, analytics
100% AutomaticElectronics, auto components, chemicals, textiles, consumer goods, capital goods
100% AutomaticNew pharmaceutical manufacturing plants. Brownfield acquisitions: 74% automatic; above 74% requires government approval.
100% GreenfieldRoads, highways, bridges, ports, airports, metro rail, power generation, transmission
100% AutomaticMarketplace model e-commerce only — connecting buyers and sellers. Inventory-based e-commerce not permitted.
100% AutomaticRetail under a single brand name worldwide. Mandatory 30% local sourcing from Indian MSMEs above 51% FDI.
100% AutomaticHotels, resorts, restaurants, food service, tourism infrastructure, travel companies
100% AutomaticHospitals, diagnostic centres, medical devices manufacturing, telemedicine, health-tech
100% AutomaticSolar power projects, wind energy, hydroelectric, energy storage, clean energy technology
100% AutomaticSchools, universities, vocational training, online education platforms, EdTech companies
100% AutomaticCaptive research and development centres — the preferred structure for global companies setting up India GCCs (Global Capability Centres)
100% AutomaticFreight, cold chain, warehousing, supply chain management, courier services
100% AutomaticPackaged foods, beverages, food manufacturing, agro-processing, food retail (with conditions)
100% AutomaticUp to 74% FDI is under automatic route — above 74% requires government approval. Not a 100% WOS sector for banking.
74% Automatic OnlyFDI capped at 51% with government route approval — WOS (100%) not permitted. JV with Indian partner required.
51% Cap — Govt RouteWhy a 100% WOS Is the Preferred India Entry Structure
For most foreign companies, a WOS offers the perfect balance — maximum control, complete profit rights, full IP protection, and a fully Indian-capable business entity.
The foreign parent retains 100% of equity permanently — unless you choose to divest. No Indian partner can dilute your ownership without your explicit consent.
Every decision — hiring, pricing, product, market, partnerships — is made by the foreign parent. No partner veto, no board deadlocks, no governance disputes.
All distributable profits belong exclusively to the foreign parent. Dividends can be remitted freely after withholding tax (DTAA rate: typically 10–15% vs 20% domestic). No profit-sharing with any Indian party.
Proprietary technology, trade secrets, source code, formulations, and brand standards stay entirely within the parent's control — there is no Indian joint venture partner to share with or who could later compete.
No inter-partner negotiations, no shareholder agreement thresholds, no minority shareholder approvals. Decisions are made at parent company speed — critical in fast-moving markets.
The parent sets and enforces global brand standards in India without compromise — no partner diluting brand messaging, product quality, or customer experience for local convenience.
The WOS is a separate Indian legal entity. India-specific liabilities, lawsuits, and debts do not reach the foreign parent company's global assets or balance sheet.
As the sole shareholder, the parent can pass many resolutions in writing without formal shareholder meetings — significantly simplifying corporate governance compared to multi-shareholder companies.
Operate fully in India — hire unlimited employees, own assets, sign Indian contracts, bid for government tenders, open branches — as a locally incorporated Indian entity.
A WOS can remain 100% foreign-owned indefinitely, bring in an Indian partner by partial divestment, or list via IPO on Indian exchanges. No structure locks you in permanently.
How to Set Up a Foreign Wholly Owned Subsidiary in India
The WOS setup follows a defined sequence — FDI eligibility first, then apostille, then incorporation, then FEMA compliance. Mitali Tita manages every step.
Confirm 100% FDI Eligibility Under Automatic Route
Verify that your proposed India business activity is on the 100% FDI Automatic Route — meaning no prior government approval is required. Most sectors qualify, but multi-brand retail, banking (above 74%), defence (above 74%), and print media have restrictions. Mitali Tita provides a detailed written FDI Sector Eligibility Report for your specific activity before any document preparation begins.
🌍 Always first step — determines if WOS is possiblePass Board Resolution in the Foreign Parent Company
The foreign parent's board passes a resolution specifically authorising: incorporation of a 100% Wholly Owned Subsidiary in India, subscription to 100% of the equity shares, appointment of nominated directors for the WOS's board, designation of an authorised signatory for incorporation filings, and the proposed registered office address in India. This resolution must be notarised and apostilled in the country of origin.
📋 Resolution must explicitly authorise 100% WOS — not just "subsidiary"Prepare & Apostille All Foreign Documents
All foreign parent documents must be notarised by a Notary Public and apostilled by the competent authority in the country of origin (for Hague Convention countries — USA, UK, Germany, France, Singapore, Netherlands, Australia, etc.). Documents: Certificate of Incorporation, MoA/AoA/Charter, Board Resolution, and foreign directors' passport/address proofs. Non-English documents require an official English translation (also notarised). For non-Hague countries: consular legalisation by the Indian Embassy is required.
📋 Start apostille immediately — runs in parallel with other stepsConfirm & Onboard the Mandatory Indian Resident Director
Even a 100% Foreign WOS must have at least one Indian resident director (stayed 182+ days in India in the previous calendar year) under Section 149(3) of Companies Act 2013. This can be a trusted local employee, a professional nominee director, or a CA/CS. Collect full KYC: PAN Card, Aadhaar, address proof (not older than 2 months), and photograph. This director will co-sign the SPICe+ form with any foreign directors.
⚠️ Non-negotiable — every Indian company must have 1 resident Indian directorReserve WOS Company Name
Search the proposed WOS name on mca.gov.in for uniqueness. Many foreign companies name their India WOS after their brand (e.g., "XYZ Corporation India Private Limited" or "XYZ India Private Limited"). The name must not be identical to any existing company, must not infringe trademarks (check ipindiaonline.gov.in), and must end with "Private Limited". Reserve via RUN form (₹1,000, 1–3 working days) or within SPICe+.
🔤 "India" in the name requires no special approval for WOSObtain DSC for All Directors
All proposed directors need Class 3 DSC. Indian directors: obtained via Aadhaar OTP online — ready in 1–2 working days. Foreign directors: obtained using their apostilled passport and foreign address proof, with video verification by the certifying authority — takes 3–7 working days. DSC is mandatory for signing SPICe+, e-MoA, and e-AoA. For a WOS, the sole subscriber (foreign parent) must also sign the e-MoA through its authorised representative.
🔐 Foreign director DSC: start early — 3–7 working daysDraft WOS-Specific MoA & AoA
The Memorandum of Association (MoA) for a WOS lists the foreign parent as the sole subscriber to 100% of the equity shares. The Articles of Association (AoA) are specifically drafted for a sole-shareholder WOS — including: written resolution mechanisms (allowing the parent to pass resolutions without formal meetings in many cases), IP protection clauses, inter-company transaction governance, parent approval thresholds for major decisions, and dividend/repatriation policies aligned with FEMA/DTAA requirements.
📝 WOS AoA is distinct from multi-shareholder company AoA — custom drafting neededFile SPICe+ on MCA Portal & Receive COI
Submit SPICe+ with: apostilled parent company documents (as subscriber KYC), all director KYC, e-MoA (sole subscriber — foreign parent), e-AoA, and India registered office proof. SPICe+ simultaneously processes: name approval · DIN allotment · PAN & TAN for the WOS · GST registration · ESIC & EPFO. Upon ROC approval, the Certificate of Incorporation (COI) is issued — your WOS is now a legally incorporated Indian Private Limited Company.
🎉 COI issued — your India WOS is officially incorporatedOpen Indian Bank Account & Receive 100% FDI Capital
Open a current bank account in the WOS's name using COI, PAN, GST certificate, director KYC, and authorised signatory details. The foreign parent remits the full subscribed capital via SWIFT to the WOS's Indian bank account. Obtain the FIRC (Foreign Inward Remittance Certificate) from the AD bank. Allot 100% of shares to the foreign parent. File INC-20A (Commencement of Business Declaration) within 180 days of incorporation.
🏦 FIRC is mandatory evidence for FC-GPR — obtain immediately on receiptFile FC-GPR with RBI — The Most Critical FEMA Step
Within 30 days of allotting shares to the foreign parent, file FC-GPR through the WOS's authorised dealer (AD) bank via RBI's FIRMS portal. Required documents: share allotment details, FIRC, KYC of the foreign parent company, share certificate, and CS/CA pricing compliance certificate confirming shares issued at or above FMV. This is the most time-sensitive compliance after incorporation. Penalty for late filing: up to 3× the investment amount.
🚨 30-day deadline from allotment — Mitali Tita files this on time, every timeWOS FEMA Compliance Timeline — What Happens & When
FEMA compliance for a Foreign WOS happens at specific milestones. Missing any deadline attracts severe penalties. Here is the complete timeline.
Certificate of Incorporation (COI) received. CIN, PAN, TAN issued.
Open current account in WOS's name at an Indian AD bank.
Receive capital → obtain FIRC → allot shares → file FC-GPR via AD bank on FIRMS portal. Penalty: 3× investment if missed.
Commencement of Business declaration with ROC. Penalty ₹50,000 if missed.
Annual Foreign Liabilities and Assets Return filed with RBI every year while parent is sole shareholder.
Every time the parent infuses additional capital and new shares are allotted — fresh FC-GPR within 30 days.
Documents Required for Foreign WOS Registration
A Foreign WOS requires apostilled foreign parent documents, Indian director KYC, and India registered office proof. All can be shared digitally.
Official certificate confirming the foreign company's legal existence, registration number, and country of incorporation.
Notarised + ApostilledConstitutional documents showing the foreign company's permitted activities, authority, and governance structure.
Notarised + ApostilledBoard resolution specifically authorising incorporation of a 100% WOS in India, 100% equity subscription, directors to be appointed, and authorised representative for incorporation.
Notarised + ApostilledValid passport of each foreign national director proposed for the WOS board. Must be notarised and apostilled copy. The authorised representative's passport is also required.
Notarised + ApostilledUtility bill or bank statement not older than 2 months — showing current residential address. Notarised and apostilled.
Notarised + ApostilledMandatory for the at least 1 Indian resident director required under Section 149(3). PAN must be linked to Aadhaar. Cannot be omitted even in a 100% WOS.
Mandatory — Indian DirectorLinked to active mobile for OTP-based eKYC during DSC application and SPICe+ filings.
Mandatory — Indian DirectorElectricity / water / telephone bill of the Indian registered office address not older than 2 months. Can be any valid Indian address — commercial or residential.
No Objection Certificate from the landlord of the Indian office address — required for SPICe+ registration.
Foreign Inward Remittance Certificate — issued by the Indian AD bank after the parent's capital is received. Required before FC-GPR can be filed with RBI.
Post-Incorporation — FEMAAnnual Compliance for a Foreign WOS in India
A Foreign WOS must comply with MCA/ROC, RBI/FEMA, and Income Tax regulations. Here is the complete annual compliance picture.
Within 30 days of every share allotment to the foreign parent. Required each time capital is infused and new shares allotted. Filed via AD bank on FIRMS portal.
By July 15 annually. Mandatory as long as parent is sole/majority shareholder (i.e., always for a WOS). Covers FDI balance, earnings, and ECBs.
Within 30 days of AGM. Parent must also consolidate WOS financials into group accounts per parent country's GAAP/IFRS. Penalty: ₹100/day.
Within 60 days of AGM. Must disclose foreign parent as 100% shareholder. Penalty: ₹100/day for delay.
By September 30. For a WOS, the sole shareholder (foreign parent) can pass AGM resolutions more efficiently — even in writing for some matters.
With proper notice, agenda, and minutes. Foreign directors can attend via video conference — no physical presence in India required for meetings.
Annual corporate tax return. Tax rate: 25% (standard) or 22% under Section 115BAA new regime. Significantly lower than branch office's 40%.
Mandatory if international transactions with foreign parent exceed ₹1 crore. CA certifies in Form 3CEB. Maintain TP Documentation throughout the year.
One-time filing within 180 days of incorporation. Bank account opened + capital received + shares allotted — then file. Penalty: ₹50,000 if missed.
All DIN holders — including any foreign directors with Indian DIN — must file DIR-3 KYC by September 30 annually. DIN deactivated if missed.
Foreign Wholly Owned Subsidiary — All Your Questions Answered
Comprehensive answers to every common question about setting up, running, and managing a 100% Foreign WOS in India.
Joint Venture (JV): Foreign parent shares equity with an Indian partner (typically 51%–74% foreign, 26%–49% Indian). Profits, control, and decisions are shared. Risk of management disputes, IP exposure to partner, slower decisions.
When JV is necessary: When the sector has an FDI cap below 100% (e.g., multi-brand retail at 51%, banking at 74%), the foreign company must have an Indian partner holding the minimum required equity — WOS is not possible in such sectors.
For most IT, manufacturing, services, and tech companies — WOS is the superior choice.
- IT / Software / ITES / BPO / Analytics
- Manufacturing (most sub-sectors)
- Pharmaceuticals (greenfield projects)
- Infrastructure (roads, ports, airports, power)
- E-commerce (marketplace model only)
- Single-brand retail (with local sourcing conditions)
- Hospitality, healthcare, education
- Renewable energy, logistics, food processing
- R&D / GCC (Global Capability Centres)
- Financial services (fund management, NBFC activities)
- Apostille in foreign country: 7–15 working days (start this immediately)
- DSC for foreign directors: 3–7 working days
- Company name reservation: 1–3 working days
- SPICe+ preparation and filing: 3–5 working days
- ROC processing and COI: 5–10 working days
- Bank account opening: 3–7 working days
- FC-GPR filing: Within 30 days of share allotment (FEMA deadline)
Critical deadline: Within 30 days of the date of allotment (not the date of fund receipt).
Process: Foreign parent remits capital → WOS receives funds → bank issues FIRC → WOS allots 100% shares to parent → FC-GPR filed through AD bank via FIRMS portal within 30 days.
Penalty for missing 30-day deadline: Up to 3 times the total investment amount or ₹2 lakh per day of continued default — one of FEMA's most severe penalties. Mitali Tita files FC-GPR on the same day as share allotment.
- WOS board declares dividend from distributable profits per Indian GAAP/Ind AS
- No RBI approval required for dividend repatriation
- Deduct Withholding Tax (TDS): 20% domestic or DTAA rate (whichever is lower) — typically 10–15% under major DTAAs (USA, UK, Singapore, Netherlands, UAE, Mauritius)
- Net dividend remitted via SWIFT through the WOS's AD bank
A common misconception: "We own 100% so there's no arm's length issue." This is incorrect. The tax authorities focus on whether transactions are at market rates — not on the ownership percentage.
Transactions requiring TP documentation: Management fees, IT services charged to parent, royalties, software licence fees, purchase/sale of goods, inter-company loans, guarantee fees, and IP transfers.
Mandatory: TP Documentation annually + Form 3CEB if international transactions exceed ₹1 crore.
Option 1 — Partial Divestment (bring in Indian partner): The foreign parent sells a portion of its WOS shares to an Indian investor — converting from WOS to a Joint Venture. Requires FEMA share transfer pricing compliance (at or above FMV) and Form FC-TRS filing.
Option 2 — Public Listing (IPO): Convert the WOS to a Public Limited Company (alter MoA/AoA, add directors/shareholders), then list on NSE, BSE, or SME platforms through an IPO. The foreign parent retains its stake even after listing.
Option 3 — Remain WOS indefinitely: If the business strategy is best served by 100% foreign ownership, the WOS can remain a WOS for its entire corporate life with no pressure to change.
RBI/FEMA: FC-GPR (within 30 days of each share allotment); FLA Return (by July 15 annually — every year while parent holds shares).
ROC: AOC-4 (30 days from AGM); MGT-7A (60 days from AGM); AGM (by September 30); 4 board meetings minimum; DIR-3 KYC (September 30); DPT-3 (June 30); INC-20A (within 180 days of incorporation — first year).
Tax: ITR-6 (corporate income tax); Form 3CEB (Transfer Pricing Audit if applicable); advance tax; TDS filings.
GST: GSTR-1 and GSTR-3B returns (monthly/quarterly if registered).
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From WOS incorporation to FEMA compliance, secretarial audit, and alternative India entry structures — complete support by Mitali Tita.
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