Foreign subsidiary registrations: India inbound and outbound, the 60-day checklist

Most foreign subsidiary projects begin with a clean expectation: incorporate the entity, fund it, and start operating. The reality on both directions — Indian parent investing abroad via ODI, or foreign parent investing into India via FDI — is that the corporate-law incorporation is the easier half. The FEMA reporting, the pricing certificate, and the post-incorporation filings within statutory windows are where deals slip.

We run this work in two modes. Outbound is governed by the Foreign Exchange Management (Overseas Investment) Rules and Regulations, 2022, which replaced Notification 120 in August that year and consolidated the prior ODI/OPI framework. Inbound is governed by the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 and the consolidated FDI policy. The 60-day window is not a rule by itself — it is the realistic envelope from kickoff to a fully compliant entity, set by the 30-day FC-GPR deadline on inbound and the equivalent OPI/ODI reporting on outbound.

What follows is the checklist we use, split by direction. The steps in each column happen in parallel, not series.

Outbound: Indian parent into a foreign subsidiary

The starting question is whether the investment qualifies as Overseas Direct Investment or Overseas Portfolio Investment. Under the 2022 framework, ODI means an unlisted equity acquisition or a holding of 10% or more in a listed foreign entity, or control irrespective of percentage. Anything else is OPI.

For an Indian operating company setting up a wholly-owned subsidiary in Singapore, the UAE, or Delaware — the three jurisdictions we see most — this is ODI. The route is automatic if the Indian party is eligible, the financial commitment is within 400% of net worth, and the foreign entity is not in a prohibited sector (real estate, gambling, financial services without RBI permission for the latter).

The pre-incorporation steps

Before the foreign entity is incorporated, the Indian parent needs a board resolution authorising the investment, a valuation certificate from a SEBI-registered Category I merchant banker or a chartered accountant (where the consideration is above USD 5 million the valuation must follow internationally accepted pricing methodology), and an AD Category I bank identified for the remittance.

The AD bank issues a Unique Identification Number against the proposed investment before the first remittance. The UIN is not optional. Every remittance, every subsequent filing, every disinvestment report references the UIN. Companies that remit funds before the UIN is issued create reconciliation problems that take months to fix.

The post-incorporation filings

Once the foreign entity is incorporated and the first remittance is made, Form FC (the consolidated reporting form under the 2022 rules) is filed within 30 days through the AD bank's interface. This replaces the older Form ODI. The form captures the financial commitment, the equity structure, the funding mode, and the foreign entity's basic details.

Annual Performance Reports follow each subsequent year by 31 December for the year ended 31 March, until disinvestment. The APR is filed by the Indian party irrespective of the foreign entity's accounting year — a point that catches first-time outbound investors when the foreign accounting year does not match.

Inbound: foreign parent into an Indian subsidiary

Inbound projects compress harder than outbound because the FC-GPR clock starts the moment shares are allotted, not the moment funds are received. Founders sometimes plan around the wire timing and miss that the allotment is the trigger.

Route determination

The first question is whether the sector requires government approval or sits under the automatic route. The consolidated FDI policy and Press Note 3 of 2020 (which subjected investments from countries sharing a land border with India to government approval irrespective of sector) jointly govern this. Sectors that still need government approval include defence beyond 74%, broadcasting content services, multi-brand retail, and a handful of others. Most technology and services investments are automatic route up to 100%.

If the parent is in a Press Note 3 jurisdiction, government approval through the FIFP portal is required even for an automatic-route sector. Approval timelines run 6 to 12 weeks and are not negotiable on speed. Plan the incorporation and approval workstreams in parallel rather than serially.

Incorporation through SPICe+

Indian subsidiaries are incorporated through SPICe+ (Simplified Proforma for Incorporating Company Electronically). The 2020-onwards consolidated form covers name reservation, incorporation, DIN allotment, PAN, TAN, EPFO, ESIC, GST registration, and bank account opening through a single application.

For a foreign-parent subsidiary, the additional inputs are the parent's corporate documents (certificate of incorporation, board resolution authorising the investment, charter documents) apostilled or consularised depending on whether the parent jurisdiction is a Hague Apostille signatory, identity documents of the proposed directors (at least one must be a resident director under Section 149(3) of the Companies Act, 2013), and the registered office address.

Pricing and FC-GPR

Shares to a non-resident must be issued at or above the fair value determined by a SEBI-registered Category I merchant banker or a chartered accountant under internationally accepted pricing methodology. The pricing certificate is dated and reflects the valuation as of a date close to the allotment.

Once the funds are received in the rupee account and shares are allotted, FC-GPR is filed within 30 days on the FIRMS portal through the AD bank. The filing requires the FIRC (Foreign Inward Remittance Certificate) issued by the receiving bank, the KYC report on the remitter, the pricing certificate, the board resolution allotting shares, and the share certificates. Missing any one of these holds up the filing.

If shares are transferred between a resident and a non-resident — a secondary sale, an internal reorganisation — FC-TRS is the relevant form, also within 60 days of the transfer or receipt of consideration, whichever is earlier.

The 60-day checklist, in parallel

Both directions, planned correctly, fit inside 60 days from kickoff to a clean compliance file. The schedule below is what we run in practice.

Week 1

On outbound: board resolution authorising the investment, AD bank identified, valuation engagement started, foreign-jurisdiction counsel briefed on the entity structure. On inbound: route determination concluded, SPICe+ name reservation filed, director identity and address documents apostilled at the parent end, parent corporate documents notarised and apostilled.

Weeks 2 and 3

On outbound: UIN application filed through the AD bank, valuation certificate finalised, foreign-jurisdiction incorporation in progress. On inbound: SPICe+ incorporation filed, PAN and TAN issued, registered office set up, banking onboarding initiated with the AD bank.

Weeks 4 and 5

On outbound: remittance executed, foreign entity bank account opened, share certificates issued by the foreign entity. On inbound: pricing certificate obtained, share subscription documents executed, funds remitted by the foreign parent, FIRC issued, shares allotted by the Indian subsidiary's board, share certificates issued.

Weeks 6 to 8

On outbound: Form FC filed within 30 days of the remittance, UIN acknowledgement linked. On inbound: FC-GPR filed within 30 days of allotment, with FIRC, KYC, pricing certificate, board resolution, and share certificates uploaded.

Where projects slip

The single most common slip we see on inbound is the gap between allotment and FC-GPR. Founders treat the allotment as the celebratory milestone and then take two weeks to assemble the underlying documents for the filing. The 30-day clock runs from the allotment date on the board resolution, not from when the documents are ready. Late filing attracts a Late Submission Fee under RBI's framework and, if delayed materially, requires a compounding application under Section 13 of FEMA.

On outbound, the most common slip is remitting before the UIN is issued. The AD bank will sometimes process the remittance against a draft UIN application; the reconciliation between the remittance and the eventual UIN is then manual and prone to error.

On both directions, the pricing certificate is the document that often arrives last. The valuer needs financial information that the new entity does not yet have, or the parent has not yet shared. Start the valuation engagement in week one of either project, not week four.

What 'done' means

A foreign subsidiary registration is not complete when the entity is incorporated. It is complete when the FEMA reporting is filed within the statutory window, acknowledged on the FIRMS or AD bank portal, and reconciled against the remittance and the cap table. Until then, the entity is operating with an open compliance flag that will surface in any future diligence, any future investment round, and any future disinvestment.

We run both inbound and outbound projects to the 60-day envelope where the parent and the AD bank cooperate on the schedule. The schedule slips when the valuation, the apostille, or the AD bank onboarding starts late. Each of those is fixable by starting them in parallel with the corporate-law work, not after it.