Overseas Subsidiary and JV Setup for Indian Companies
From structure planning to incorporation support — we coordinate overseas subsidiary and JV setup end-to-end with FEMA-compliant documentation.
Part of our Global Expansion advisory. For the FEMA/RBI fundamentals, read our ODI Compliance Guide for Indian Companies.
Structure Options
- Wholly Owned Subsidiary (WOS) — 100% Indian-owned overseas entity.
- Joint Venture with a foreign partner — shareholding, governance and SHA structuring.
- Step-down subsidiary considerations — layered holding and FEMA reporting impact.
- Choice of jurisdiction based on tax treaties, ease of business and substance requirements.
Our Setup Support
- Structure memo — entity type, jurisdiction, shareholding and funding mix.
- Funding route — equity, loan or guarantee within ODI limits.
- Documentation pack for the AD-bank including UIN application and Form ODI Part I.
- Coordination with overseas incorporation agents and local counsel.
Post-Setup Compliance
- Annual Performance Report (APR) for every overseas JV/WOS.
- ODI annual reporting and Form ODI Part II/III for subsequent transactions.
- FLA return and ongoing FEMA filings linked to the overseas investment.
- Audit coordination and transfer-pricing inputs where applicable.
Setting up a company abroad, step by step
For an Indian business expanding overseas, the setup has two sides: the foreign country's company formation, banking and tax rules, and India's overseas investment rules. Most delays happen where the two meet, for example when the foreign bank wants share capital before incorporation but the Indian AD bank needs incorporation documents before releasing it.
- Jurisdiction choice: customer location, tax treaty with India, cost of compliance, ease of banking and substance requirements.
- Structure: wholly owned subsidiary or JV with a local partner, share classes and governance.
- Indian approvals: board approval, financial commitment check, valuation where shares are acquired, Form ODI and remittance through the AD bank.
- Local formation: registration, local directors or agents where required, tax and VAT/GST registration, and bank account.
- Post-setup: share certificate submission in India and the annual APR cycle.
Tax and transfer pricing
Transactions between the Indian parent and the overseas subsidiary, such as sales, services, loans and guarantees, are international transactions that must be priced at arm's length and documented. The place of effective management of the subsidiary should be genuinely abroad; if key decisions are taken in India, the subsidiary may be treated as resident in India for tax. Our guide to POEM and permanent establishment explains the risk.
Figures and timelines above reflect our understanding at the time of writing; confirm against the latest Act, Rules and notifications before relying on them.
Practical questions
Should the JV partner be local?
In some countries local ownership is required for certain activities. Even where it is not, a local partner can help with licences and customers, but the JV agreement needs strong deadlock and exit clauses. See JV advisory.
Can we start trading before the ODI filing?
No. The remittance and the filing go together, and the overseas entity should not be funded from India outside the ODI framework.
Set Up Your Overseas Arm the Right Way
Talk to our cross-border team for structure, funding route and compliance roadmap.