Foreign Company Compliance in India

Foreign companies registered in India are required to maintain various additional compliances under the Companies Act, 2013. In this article, we look at some of the unique compliance requirements for a foreign company registered in India.

Form FC-1

Foreign companies registered in India are required to file Form FC-1 within a period of thirty days of the establishment of its place of business in India. The application must be supported with an attested copy of approval from the Reserve Bank of India under the terms of Foreign Exchange Management Act or Regulations, and too from other regulators, if any, sanction is necessary.

Financial Statements

All foreign companies registered in India are required to organize financial statement of its Indian business operations in agreement with Schedule III of the Companies Act, 2013. Thus foreign companies are required to furnish the following information / statements together with the financial statements of the company to be filed with the Registrar of Companies:

Statement of associated party transaction,
Statement of repatriation of profits
Statement of transfer of funds (including dividends if any) which shall, in relation of any fund transfer between place of business of foreign company in India and any other related party of the foreign company

The documents that are referred to above in this rule must be delivered to the Registrar of Companies within a period of six months from the end of the financial year of the foreign company.

Audit of Accounts of Foreign Company

All foreign companies must get its accounts, pertaining to the Indian business operations organized in agreement with the necessities of clause (a) of sub-section (1) of section 381 and rule 4 and audited by a practicing Chartered Accountant in India or a firm or LLP of practicing Chartered Accountants.

Form FC-3

All foreign companies are required to file with the Registrar of Companies, Form FC-3 detailing the list of places of business of the foreign company along with the financial statements of the company.

Annual Return

Foreign company must prepare and file the annual return of the company in Form FC-4 within a period of sixty days from the final day of its financial year. Any document which should be delivered from a foreign company can be delivered to the Registrar of Companies with jurisdiction over New Delhi.

Authentication of Translated Documents

Documents necessary to be filed with the Registrar of Companies by the foreign company must be in English language. If any translation is made out of India, it must be authenticated by the signature and the seal of the official with custody of the original or a Notary of the country where the company has been incorporated. Where such translation is made in India, it shall be authenticated by an Advocate, attorney or pleader entitled to appear facing any High Court and an affidavit, of a competent person having, in the estimation of the Registrar.

Click here to learn about about registration of a foreign company in India.

MCA Notification on Companies (Registration of Foreign Companies) Amendment Rules, 2024

The Central Government has issued a notification (G.S.R. 491(E)) amending the Companies (Registration of Foreign Companies) Rules, 2014, through the Companies (Registration of Foreign Companies) Amendment Rules, 2024. These amendments will come into effect from September 9, 2024. The primary changes introduced by the notification are:

Substitution of "Registrar" with "Registrar, Central Registration Centre": The term "Registrar" has been replaced with "Registrar, Central Registration Centre" in Rule 3, in sub-rule (3). This implies a centralized registration process for foreign companies.
Insertion of New Proviso: A new proviso has been inserted in Rule 8, in sub-rule (1). This mandates that all documents required for the registration of a foreign company, as specified in Rule 3(3), must be submitted in Form FC-1 to the Registrar, Central Registration Centre.

Below, we have attached the official MCA notification on Companies (Registration of Foreign Companies) Rules, 2014,

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Frequently Asked Questions

Common questions about Foreign Company Compliance in India.

Foreign companies registered in India are required to file Form FC-1 within 30 days of establishing a place of business in India. This application must be accompanied by an attested copy of approval from the Reserve Bank of India under the Foreign Exchange Management Act or Regulations, and from other regulators if any sanction is necessary.

Foreign companies registered in India must prepare financial statements of their Indian business operations in accordance with Schedule III of the Companies Act, 2013. They must also provide statements of related party transactions, repatriation of profits, and transfer of funds (including dividends, if any) between their Indian place of business and any other related party of the foreign company.

Foreign companies must have their accounts pertaining to their Indian business operations, prepared in accordance with Section 381(1)(a) and Rule 4, audited by a practicing Chartered Accountant in India or a firm or LLP of practicing Chartered Accountants.

Foreign companies are required to file Form FC-3 with the Registrar of Companies, detailing the list of places of business of the foreign company along with the company's financial statements.

Foreign companies must prepare and file their annual return in Form FC-4 within 60 days from the last day of their financial year.

Any document that a foreign company needs to deliver can be submitted to the Registrar of Companies with jurisdiction over New Delhi.

Documents that foreign companies need to file with the Registrar of Companies must be in English. If translated outside India, they must be authenticated by the signature and seal of the official with custody of the original or a Notary of the country where the company is incorporated. If translated in India, they must be authenticated by an Advocate, attorney or pleader entitled to appear before any High Court, and an affidavit of a competent person, as deemed acceptable by the Registrar.

The Central Government has issued a notification (G.S.R. 491(E)) amending the Companies (Registration of Foreign Companies) Rules, 2014, through the Companies (Registration of Foreign Companies) Amendment Rules, 2024. The primary changes include the substitution of "Registrar" with "Registrar, Central Registration Centre" and the insertion of a new proviso mandating that all documents for foreign company registration must be submitted in Form FC-1 to the Registrar, Central Registration Centre.

The Companies (Registration of Foreign Companies) Amendment Rules, 2024 will come into effect from September 9, 2024.

The recent amendment to the Companies (Registration of Foreign Companies) Rules, 2014, through the Companies (Registration of Foreign Companies) Amendment Rules, 2024, seems to aim at centralizing the registration process for foreign companies in India by introducing the concept of a "Registrar, Central Registration Centre" and mandating the submission of all registration documents to this central authority.