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International Client Services

Diwan Advocates

International Client Services

A German manufacturing company wants to set up a production facility in India. It can do so as a wholly owned subsidiary, as a joint venture with an Indian partner, through an LLP, or via a liaison or branch office. Each structure has a different tax profile, a different governance requirement, a different liability exposure, and a different path to eventually repatriating profits. The company's advisers in Frankfurt know German law. What they need is a team in Delhi that can answer the India-specific questions with the same precision.

An NRI settled in Canada holds a share in ancestral property in Delhi with three siblings. One sibling has built on the common property without consent. The NRI wants to partition the property, sell their share, and repatriate the proceeds. That involves Hindu succession law, the Transfer of Property Act, FEMA's rules on sale of immovable property by an NRI, and the tax treatment of the capital gain. It cannot be handled from Canada alone.

International clients dealing with India face a legal system that is sophisticated, multi-layered, and requires local knowledge to navigate effectively. At Diwan Advocates, we serve as the Delhi anchor for foreign law firms, multinational companies, foreign investors, and NRIs who need Indian legal advice they can rely on.

India Entry: Choosing the Right Structure

Wholly Owned Subsidiary

A private limited company incorporated under the Companies Act, 2013 is the most common vehicle for a foreign company's India operations. It has a separate legal identity, limited liability, and can employ staff, hold assets, and enter contracts in its own name. Foreign investment in the subsidiary must comply with the applicable sectoral caps and conditions under FEMA and the FDI Policy.

Joint Venture

A joint venture with an Indian partner is required in sectors where 100 percent FDI is not permitted and is often commercially advantageous in sectors where local relationships and market knowledge matter. The shareholders agreement governing the JV must address decision-making rights, deadlock resolution, exit mechanisms, and the FEMA implications of the Indian partner's acquisition or disposal of their stake.

Liaison and Branch Offices

Foreign companies that want a presence in India without full incorporation can establish a Liaison Office for representational activities or a Branch Office for limited commercial operations. Both require RBI approval. A Liaison Office cannot undertake commercial activities or earn revenue. A Branch Office can carry on activities approved by the RBI but is not a separate legal entity and exposes the foreign parent to direct liability in India.

Cross-Law Note: The choice of entry structure has significant income tax consequences. A subsidiary is taxed as an Indian company. A branch office is taxed as a foreign company at a higher rate on its Indian income. Transfer pricing rules apply to transactions between the Indian entity and its foreign parent or affiliates, and the arm's length principle requires those transactions to be priced as if between unrelated parties. The Place of Effective Management rules can also treat a foreign company as an Indian resident for tax purposes if its management decisions are actually made in India.

Foreign Investment: FEMA Compliance

All foreign direct investment in India is governed by the Foreign Exchange Management Act, 1999 and the FEMA (Non-Debt Instruments) Rules, 2019. FDI under the automatic route does not require prior government approval. FDI in sectors on the government route requires approval from the relevant ministry. The FDI Policy sets out the applicable caps and conditions by sector.

Every issuance of shares to a foreign investor must be at a price not less than the fair market value determined by a SEBI-registered valuer. Shares sold by a foreign investor to an Indian resident cannot be sold above the fair market value. Filing of Form FC-GPR on receipt of foreign investment and Form FC-TRS on transfer of shares between residents and non-residents is mandatory within prescribed timelines. Late filings require compounding.

Downstream investment, the onward investment by an Indian company that has received foreign investment into another Indian company, is subject to restrictions that treat the investing company as if it were the foreign investor for the purposes of sectoral caps and conditions. This is a commonly missed compliance point in multi-tier Indian holding structures.

Cross-Border Arbitration and Dispute Resolution

India is a New York Convention country. Foreign arbitral awards made in Convention countries are enforceable in India under Part II of the Arbitration and Conciliation Act, 1996. Enforcement can be resisted on limited grounds: incapacity, invalid agreement, lack of notice, excess of jurisdiction, non-arbitrability of the subject matter, and public policy. Indian courts have applied the public policy exception narrowly since the 2015 amendments, making enforcement significantly more predictable.

For international commercial arbitration seated in India, Part I of the Act applies. Indian courts have supervisory jurisdiction including powers to appoint arbitrators, grant interim relief, and set aside awards on Section 34 grounds. We act as Indian counsel in ICC, SIAC, LCIA, and DIAC arbitrations involving Indian parties or Indian-law governed contracts.

Cross-Law Note: A foreign judgment from a country with which India has a reciprocal enforcement arrangement is executable as a decree in India under the Civil Procedure Code. A foreign judgment from a non-reciprocating country must be re-litigated in India as a fresh suit, though the foreign judgment carries strong evidential weight. The United States and India do not have a reciprocal enforcement arrangement, which means US court judgments must be re-litigated in India.

NRI Services

Non-Resident Indians dealing with Indian legal matters face the combined challenge of Indian legal complexity and physical distance. Property inherited or purchased in India, family disputes with relatives in India, business interests in Indian companies, and regulatory requirements all need a firm that can act on instructions given remotely and report back clearly.

We advise NRIs on the purchase and sale of immovable property in India including FEMA compliance on repatriation of sale proceeds, succession and inheritance matters including obtaining succession certificates and letters of administration, partition of jointly held family property, matrimonial disputes involving a spouse in India or abroad, NRI investment in Indian companies, and the income tax treatment of income from Indian sources. We maintain clear communication with NRI clients across time zones and provide regular updates without requiring their presence in India.

Where an NRI faces a dispute with a family member, business partner, or government authority in India, we represent them in courts and before regulatory authorities in Delhi and co-ordinate with counsel in other cities where required.

Bilateral Investment Treaties and Investor-State Disputes

India has entered into a number of Bilateral Investment Treaties that provide foreign investors with protections against expropriation, unfair and inequitable treatment, and denial of justice. Following the White Industries case in 2011, India terminated many of its early BITs and replaced them with a revised model treaty. Foreign investors who believe they have been treated in violation of the applicable BIT can initiate investor-state arbitration. We advise foreign investors on the availability and merits of BIT claims and on the Indian domestic law position that will be relevant in the treaty arbitration.

Why Diwan Advocates for International Clients?

India Entry Structuring	We advise foreign companies on choosing the right Indian entity: wholly owned subsidiary, joint venture, liaison or branch office, or LLP. Each has different regulatory, tax, and operational implications.
FEMA and RBI Compliance	Every foreign investment, repatriation of profit, and cross-border payment must comply with FEMA. We handle the filings, approvals, and ongoing compliance so our clients focus on the business.
Cross-Border Disputes	International arbitration, foreign decree enforcement, and disputes with Indian joint venture partners are handled by a team that understands both Indian law and international practice.
NRI Legal Services	NRIs dealing with Indian property, succession, business interests, matrimonial matters, or regulatory requirements need a trusted Delhi-based firm that can act without them being present. We are that firm.
Bilateral Treaty Navigation	DTAA, BIT claims, WTO dispute participation, and mutual legal assistance treaty requests all require understanding of both the applicable treaty and the Indian domestic framework.

Legislative Reference Index

Legislation	Relevance	Reference
Foreign Exchange Management Act, 1999	Governs all foreign investment into India, repatriation of proceeds, external commercial borrowings, and current account transactions. The RBI issues master directions under FEMA that are updated frequently.	View ->
Companies Act, 2013	Foreign companies setting up Indian subsidiaries must comply with this Act for incorporation, governance, annual filings, and winding up. Foreign branch offices and liaison offices are also registered under this Act.	View ->
Income Tax Act, 1961	Double tax avoidance agreements are applied under the income tax framework. Withholding tax on payments to non-residents, POEM, transfer pricing, and GAAR are critical considerations for international structures.	View ->
Arbitration and Conciliation Act, 1996	Foreign arbitral awards are enforced in India under Part II of this Act as a New York Convention country. The Act also governs international commercial arbitration seated in India.	View ->
Specific Relief Act, 1963	Foreign judgments and decrees that are not arbitral awards may be executed in India as decrees under the Code of Civil Procedure if they satisfy the conditions in Section 13 of that Code.	View ->
Competition Act, 2002	Foreign-to-foreign mergers that meet Indian jurisdictional thresholds require CCI approval. The 2023 amendment introduced deal-value thresholds specifically targeting large digital economy cross-border acquisitions.	View ->
SEBI Regulations on FPIs	Foreign portfolio investors investing in Indian securities markets operate under a dedicated SEBI registration and compliance framework including KYC, investment limits, and disclosure obligations.	View ->
Insolvency and Bankruptcy Code, 2016	Cross-border insolvency is addressed through voluntary arrangements under Section 234 and the Model Law framework for international co-operation in insolvency proceedings.	View ->
Indian Stamp Act and State Stamp Acts	Cross-border transactions involving Indian assets, including share purchase agreements and asset transfers, attract Indian stamp duty at state-prescribed rates.	View ->
Prevention of Money Laundering Act, 2002	International transactions involving Indian entities trigger PMLA compliance obligations including KYC, suspicious transaction reporting, and record-keeping requirements for regulated entities.	View ->

International clients dealing with India need a firm that understands both the legal system and the practical reality of operating across borders.

Diwan Advocates has been that firm for clients across Asia, Europe, North America, and the Gulf.

We are ready to be that firm for you.

Diwan Advocates | Delhi, India

We are ready to be that firm for you.

Diwan Advocates | Delhi, India

Dr. Farrukh Khan

Dr. Farrukh Khan is the founding partner of the firm, and is also the administrative head. He is placed amongst the most eloquent and skilful lawyers in the country with above par legal knowledge....