{"id":12514,"date":"2017-01-10T11:43:14","date_gmt":"2017-01-10T11:43:14","guid":{"rendered":"https:\/\/www.legalraasta.com\/blog\/?p=12514"},"modified":"2026-04-07T17:17:47","modified_gmt":"2026-04-07T11:47:47","slug":"subsidiary-company-india","status":"publish","type":"post","link":"https:\/\/www.legalraasta.com\/blog\/subsidiary-company-india\/","title":{"rendered":"Incorporation of Wholly Owned Subsidiary Company in India"},"content":{"rendered":"

Another useful term which is really very important in the world of shares. This important term is A “Wholly Owned Subsidiary Company”<\/p>\n

Before moving further, it is necessary to know about its definition. Basically, if there is an entity of which 100 percent shares are held by another company. for example, if there is ‘A’ Pvt. Ltd. The company having shares that hold 100 shares of another Pvt. Ltd. that is ‘B’, then in this case, ‘B’ Pvt. Ltd. Becomes a wholly owned subsidiary company of ‘A’ Pvt. Ltd.<\/p>\n

If we talk about the relation between India and the foreign company, then another term comes into play, that is Foreign Company.<\/p>\n

Well, It can be defined as a company that is incorporated outside India (that is in a foreign country) is called Foreign Company. For eg, in the above example, ‘A’ Pvt. Ltd. In U.S.A. is a foreign company.<\/p>\n

When an entity which is incorporated outside India (that is foreign country), makes 100% FDI in India, the Indian company incorporated for this purpose is said to be wholly owned subsidiary of that foreign entity.<\/p>\n

There are more exemptions which can be claimed by a private limited company under the Indian Companies Act,1956 previously an now the companies act, 2013, hence most of the companies prefer to form a wholly owned subsidiary private limited company<\/strong><\/a>.<\/p>\n

Read: Exemptions Private Limited Companies<\/a><\/span><\/p>\n

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