Doing Business in India — Indian Counsel for Foreign Companies & Investors
with the details owned.
A foreign company enters India by choosing a structure — usually a wholly-owned subsidiary or a joint venture — investing through the applicable FDI route under FEMA, and then building the contract, employment and compliance stack that lets it operate. Candour Legal advises on each of those steps as Indian counsel: we handle the Indian law directly, and coordinate tax, company-secretarial and foreign-law specialists where the matter needs them.
How a foreign company starts operations in India
Most foreign businesses enter through a private limited company — wholly owned where the sector’s FDI rules permit it, or as a joint venture where a local partner adds distribution, land or licences. Branch and liaison offices exist as alternatives but need RBI-route approval and suit narrower purposes. Investment flows in under the Foreign Exchange Management Act: most sectors sit on the automatic route, where no prior approval is needed and the work is in the post-investment filings; some regulated sectors need government approval, and investments from land-border countries have their own approval requirement. The structure decision is commercial as much as legal — tax treatment, repatriation, exit and control all pull on it — which is why we put it in writing with the trade-offs before anything is incorporated.
What we handle
Eight workstreams that take a foreign business from decision to operating reality.
Entry structures & incorporation
Wholly-owned subsidiary, joint venture, branch or liaison office — the trade-offs in writing, then incorporation coordinated with the company-secretarial professionals who handle MCA filings, so the entity arrives with a clean constitutional base.
FDI routes & FEMA
Route analysis under the FDI policy — automatic versus approval, sectoral caps and conditions, land-border-country rules — and the FEMA reporting that follows investment, coordinated with authorised-dealer banks. Past lapses are addressed through compounding.
Joint-venture & shareholder arrangements
Shareholders’ agreements that anticipate deadlock, exit, transfer restrictions and enforcement realities in India — drafted by the team that also litigates these documents when ventures fail, which changes how we write them. Through our corporate practice.
Commercial contracts under Indian law
Supply, distribution, agency, franchise, licensing and services agreements — governing law and dispute-resolution clauses chosen deliberately, with arbitration seats and enforcement routes considered at drafting, not discovered in dispute.
Employment & contractors
Indian employment contracts and handbooks, employee-versus-contractor structuring for foreign companies building Indian teams, POSH compliance, and exits and investigations handled to Indian law and documentation standards.
Data protection & technology
DPDP Act applicability and compliance for foreign businesses processing Indian personal data, SaaS and technology contracting, and IT-rules questions — grounded in our DPDP practice.
Investment & legal due diligence
Title to shares, corporate records and authorisations, promoter and group-structure review, material contracts, financing and security, litigation and regulatory searches, employment and licences — red-flag or full-scope, reported in a form an investment committee abroad can act on.
Ongoing counsel & the GCC route
Retained Indian counsel after entry — board and governance support, contract flow, disputes readiness — and structuring for global capability centres through our dedicated GCC practice.
How an India-entry engagement runs
We hear the business plan, flag the FDI-route and regulatory position for your sector, and give you a written structure recommendation with the trade-offs — before any formation cost is incurred.
Incorporation, FEMA-compliant capitalisation and post-investment filings, coordinated across counsel, company secretaries and the authorised-dealer bank.
Employment documents, commercial contracts, data-protection posture and IP assignments — built as a set, so the documents refer to each other instead of contradicting each other.
State and central registrations mapped to the actual business, and a calendar of recurring obligations handed to whoever will own it — in-house, or the specialists we coordinate.
Once live, matters arrive as they arrive — a distributor default, an employee exit, a notice. Retained or per-matter, the same team that built the stack handles what the stack encounters.
Frequently Asked Questions
The questions foreign companies ask before committing to India.
Can we hire people in India without setting up an entity?
To a point. Independent contractors and employer-of-record arrangements let foreign companies engage Indian talent without a local entity, and many start that way. But contractor arrangements that function like employment create misclassification risk, and a sustained Indian operation can raise permanent-establishment questions on the tax side — which we flag and route to qualified tax advisers. When a team stops being an experiment, an entity usually becomes the cleaner answer, and we help make that transition orderly.
Should we choose a wholly-owned subsidiary or a joint venture?
A wholly-owned subsidiary gives control and simplicity, and is the default where the FDI rules for your sector allow full foreign ownership. A joint venture makes sense where a partner genuinely contributes — distribution, regulatory position, land — but everything then depends on the shareholders’ agreement: deadlock, exit, valuation and transfer restrictions decided while the parties still like each other. We advise on the choice and paper it either way.
What approvals does a foreign investor actually need?
In most sectors, none in advance — the automatic route permits investment without prior approval, with the obligations arriving afterwards as FEMA filings and pricing compliance. Government approval is needed in specified regulated sectors, above sectoral caps, and for investment from countries sharing a land border with India. The route analysis is one of the first things we put in writing, because it shapes both timeline and structure.
What does legal due diligence on an Indian company cover?
The corporate record at the MCA, share title and capitalisation history, promoter and group structure, material contracts and their change-of-control clauses, borrowings and registered security, litigation and enforcement searches across courts and tribunals, employment liabilities, licences and property. The output is a report that separates deal-breakers, price-adjusters and fixable conditions — not an undifferentiated list of everything found.
Do you handle the tax and accounting side too?
No — and you should be wary of any law firm that claims to do everything. Tax structuring, transfer pricing, audit and bookkeeping belong with chartered accountants and tax advisers. We identify the issues, bring in qualified professionals we work with regularly or yours, and coordinate the whole so you deal with one accountable team rather than five unconnected advisers.
Does India’s DPDP Act apply to a foreign company?
It can. The Act applies to processing of digital personal data within India, and extends to processing outside India where it relates to offering goods or services to persons in India. A foreign SaaS or consumer business serving Indian users can therefore be within scope without any Indian entity. We assess applicability, and where it applies, build the consent, notice and grievance framework the Act requires.
Which disputes clause should our Indian contracts use?
Deliberately chosen, not copied. For significant contracts we usually recommend arbitration — seat selected with enforcement in mind, institution and language specified, interim-relief access preserved — because a foreign award from a New York Convention country and an Indian award are both enforceable here through defined routes. For smaller operational contracts, Indian court jurisdiction is often the economical answer. The wrong clause is the one nobody thought about; details sit with our arbitration practice.
Considering India? Start with the structure memo.
Tell us the business, the sector and the plan. We will come back with a conflict check and a written view on route, structure and the realistic sequence — before you commit to anything.
Discuss an India Entry →