LIVE GST Certification Course by CA Arun Chhajer begins 27th April. Register Now!!

Regultion in forming A pvt ltd

John Joseph (FINANCE MANAGER) (77 Points)

26 August 2010

Dear Colleagues,

If 2 person wants to promote a PVT LTD co. , one is a foreigner. Could a foreigner can be a promoter of INdian Co??

Can he became Director? Is there any regulations ??

What all requirement he has to full fill to become a promoter, sharehloder, director ??

Reply
Follow
Share

6 Replies

HARDIK (COMPANY SECRETARY NCFM (Corporate Governance )) (664 Points)
Replied 26 August 2010

A foreigner can become director and shareholder. However apart from company law fema also applicable in case foreigner is subscriber to the MOA and shares alloted to him. so kindly see fema regulation regarding particular sector and fdi limit in this regard. for appoinement as a director din required and in case of foreigner docs required to be certified by embessy.

(Guest)

Yes, a Foreigner can become a director, shareholder & promoter of or in any Indian Company and about FEMA there are small points which you have to comply

thanks

vivek (CS) (751 Points)
Replied 26 August 2010

There is no restriction he can become promoter, shareholder and director. Here, you will have to comply FEMA while issuing Shares to any PROI (Person resident outside India). While obtaining DIN of concerned foreign director you will have to additionaly comply:-

Process for applicants who are (i) Indian citizens residing abroad; (ii) foreign nationals residing in India; and (iii) foreign nationals residing outside India

While general conditions as mentioned at Sr.No. 1, 3, 4 and 5 would be applicable in these categories also, the certification of attached documents and the photograph may be done by a notary in the home country of the applicant or the Managing Director/ CEO of the Company on which he is a Director or the Company Secretary in full time employment of the Company. Further, in the case of a Foreign National, certified copy of the valid passport should be enclosed.

Regards,

John Joseph (FINANCE MANAGER) (77 Points)
Replied 26 August 2010

Hi Hard**k ,

thanks a lot...

Wat Rules and regulations in Companies Act Reagarding a foreigner to be a Director??

Kumar (Legal Consultant) (358 Points)
Replied 26 August 2010

There is no seperate requirement need to be fulfilled by the foreigner to be a Promoter/shareholder/director in the private limited company.Only you have to ensure that he obtain proper DIN alongwith indian Promoter/shareholder/director .At the time of infusion of money in the incorporated company foreigner has to compply FDI policy.

Regards