Incorporation & Acquisition of Entities in India

Home » Incorporation & Acquisition of Entities in India

Incorporation & Acquisition of Entities in India

Looking to start or expand your business in India? Incorporating a new entity or acquiring a stake in an existing one offers strategic and compliant routes to establish a solid business footprint in the Indian market.

Incorporating an Entity in India

A person resident outside India who intends to engage in trading, manufacturing, or service-related activities may incorporate a new entity in India. Depending on the sector, and guided by the Foreign Exchange Management (Non,debt Instruments) Rules, 2019 (commonly known as FEMA NDI Rules 2019), foreign investors may choose to incorporate:

A Public Limited Company
A Private Limited Company
A Limited Liability Partnership (LLP)

These entities are recognized as Indian businesses and must comply with applicable local laws and statutory provisions. Foreign investment in LLPs is permitted under the automatic route only in sectors where 100% FDI is allowed and where there are no FDI-linked performance conditions. This route makes FDI in LLP a viable and flexible option for eligible sectors. Incorporation follows:

Companies Act, 2013 (for companies)
Limited Liability Partnership Act, 2008 (for LLPs)

These laws are administered by the Ministry of Corporate Affairs (MCA) through the Registrar of Companies (ROC). Pro Tip: If you are planning to incorporate a FEMA LLP, ensure that the sector is fully open to FDI under the automatic route and that your structure complies with the latest FEMA guidelines

Acquiring Stake in an Existing Entity

Another strategic route for entering the Indian market is acquiring equity in an already established Indian business. As with incorporation, this process is regulated under FEMA NDI Rules 2019 and associated notifications as amended from time to time.

A person resident outside India can acquire a stake in an Indian entity depending on:

Sectoral caps
Entry routes (automatic or government approval)
Compliance with FEMA and other applicable laws

Acquisition allows the foreign investor to benefit from existing operations, infrastructure, and market presence, enabling quicker market penetration with lower startup risk.

Why Choose FEMABIDE Advisorz?

At FEMABIDE Advisorz, we provide complete assistance with:

Entity structure selection and registration
FEMA LLP compliance and setup
Advisory on FDI in LLP and company incorporation
Legal and regulatory due diligence
End-to-end support from application to operational readiness

Company Acquisition India, The FEMA and RBI Framework for Cross-Border Mergers and Acquisitions

Company acquisition India by a foreign investor or Indian company involves a multi-layered FEMA compliance framework, covering share pricing under FEMA NDI Rules, sector-specific FDI caps and conditions, FC-TRS filing for transfer of shares between residents and non-residents, RBI reporting through the FIRMS portal, and the FEMA Cross-Border Merger Regulations 2018 for transactions involving NCLT,sanctioned schemes. Mergers India compliance for cross-border transactions requires both sides of the transaction to be FEMA-compliant, the Indian company receiving the foreign investment and the foreign company whose shares the Indian investor is acquiring, with valuation, documentation, and reporting obligations on both sides.

Mergers India Compliance, The 2-Year FEMA Window That Follows Every NCLT-Approved Cross-Border Merger

Mergers India compliance does not end with NCLT approval, for cross-border mergers, it begins there. Under the FEMA Cross-Border Merger Regulations 2018, any asset, liability, or borrowing inherited through the merger that is not FEMA-compliant must be resolved within two years of NCLT sanction. Company acquisition India through merger, whether inbound or outbound, requires a comprehensive FEMA compliance audit of every inherited position: foreign borrowings, overseas guarantees, assets outside India, INR liabilities of foreign resultant entities, and RBI reporting obligations. At Femabide Advisorz, our company acquisition India advisory covers the complete FEMA compliance lifecycle, from pre-transaction due diligence and structuring through FC,TRS filing, NCLT,related FEMA compliance, and the two-year post-merger resolution plan. For mergers India compliance that protects your transaction from the ground up, Femabide Advisorz is the specialist firm M&A teams rely on.

Reach us

Ready to Incorporate or Acquire in India?

Let us help you navigate the complexities of FEMA LLP, FDI in LLP, and entity acquisition with ease and compliance.

Full Name

Phone

Nature of Query

Country

India Others

State

description of your query

Incorporation & Acquisition of Entities in India