Holding Companies in India
Updated on Friday 26th January 2018
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A holding company in India is defined by the Company Law, which states that this business form is registered with the purpose of controlling other companies. The holding company may own another legal entity through the ownership of shares or by controlling its management. Businessmen interested in starting a company in India under this business form may find a complete defintion of the term under the Section 2 (46) of the Companies Act 2013. Our team of specialists in company formation in India can provide legal representation on the procedures concerning the registration of this business form.
Main characteristics of the Indian holding companies
The main purpose of an Indian holding company is to perform investments in other companies, which are referred to as operating companies. As a general rule, a holding company may perform the following activities:
• deciding on the investment policies of its operating companies.
It is important to know that in India, just like in other jurisdictions, a holding company is not entitled to complete commercial activities. This type of company is usually incorporated by businessmen due to its tax reduction schemes and asset protection regulations and our agents in India can provide further advice on the main advantages available for the holding company.
Register a holding company in India
Businessmen who want to know how to form a company in India under this structure should first choose a legal entity. As a general rule, two types of companies are preferred in this case:
Amongst the registration requirements, the investors have to file an application with the local authorities, in which they will offer information on the new company, such as:
• the company’s trading name;
• the name of the company’s representatives;
• the company’s statutory documents.
Another requirement for company formation in India in this sense is to open a corporate bank account for the newly founded business, as the holding company must have a separate account than the ones of the operating companies it controls.
Other compulsory steps are prescribed by the local law and foreign businessmen may contact our team of specialists in company registration in India for a complete presentation.