Foreign founders most commonly form a Private Limited Company in India — 100% foreign ownership is allowed, but the entity requires at least 2 directors and 2 shareholders, with at least one director being an Indian resident. Other structures include LLP (foreign investment requires prior RBI approval, unlike the automatic route for Private/Public Limited companies), Branch Office, Liaison Office (limited to non-commercial liaison activities), and Project Office (for specific project execution). After share allotment to a foreign shareholder, Form FC-GPR must be filed with the RBI within 30 days, and the company must file an annual FLA (Foreign Liabilities and Assets) Return with the RBI by 15 July each year.
Private Limited Company: most common structure for foreign founders, 100% foreign ownership allowed, but requires at least 2 directors (one must be an Indian resident) and 2 shareholders.
Branch Office, Liaison Office, and Project Office are alternative structures for established foreign companies with narrower activity scopes.
Form FC-GPR must be filed with RBI within 30 days of allotting shares to a foreign shareholder.
Annual FLA (Foreign Liabilities and Assets) Return must be filed with RBI by 15 July every year.
Steps
Obtain DIN and DSC — Director Identification Number and Digital Signature Certificate required for all directors.
Secure a registered office address in India — Required for incorporation filings.
Incorporate via MCA portal — File incorporation documents with the Ministry of Corporate Affairs, appointing at least one Indian resident director.
File FC-GPR post-investment — Within 30 days of allotting shares to the foreign shareholder.
File annual FLA Return — Due by 15 July each year with the RBI.
Required Documents
Director Identification Number (DIN) for all directors
Digital Signature Certificate (DSC) for all directors
Registered office address proof in India
Passport/ID of foreign shareholders and directors
Common Mistakes
Assuming 100% foreign ownership means no Indian resident director is needed — Indian company law requires at least one Indian resident director regardless of ownership split.
Missing the 30-day FC-GPR filing deadline after share allotment to a foreign shareholder, or the annual 15 July FLA Return deadline.