LLP Registration Process for NRIs and Foreign Nationals

After the government's decision to allow 100% FDI in LLP under the automatic route; it has become easy for foreign nationals and NRI's to open a
business in India. However, the process is a bit different for NRI's when compared to foreign nationals. This article will help you understand the
process of LLP registration in India for the former and the latter and give you a clear understanding of the topic enabling you to operate a business
in the country.
Foreign Nationals and NRIs have started businesses in India through a private limited company, as it allowed for 100% Foreign Direct Investment
(FDI) under the automatic route for several sectors.
Though, the cost for the purpose of incorporation of a private limited company is relatively low as compared to the effort required to maintain the
compliance was an inhibiting factor.
To allow the NRIs and Foreign Nationals to freely invest in the businesses in the country of India and to improve foreign investment; the Government
has now allowed 100% FDI in LLP as under the automatic route.
Here is a brief on the procedure of LLP registration for NRIs and Foreign Nationals.

LLP Registration
Limited Liability Partnership (LLP) is one of the latest forms of business entity in India through the Limited Liability Partnership Act, 2008.
LLP registration was started in India in the year 2008 and has gained quick momentum and popularity amongst small businesses owing to the low
registration cost and lesser compliance requirements when compared to a private limited company.
India Entry for NRIs and Foreign Nationals
Incorporation of Company
The incorporation of a private limited company or investment in a particular company has undoubtedly been the most preferred strategy for entry
into India for NRIs and Foreign Nationals. 100% FDI under the automatic route has been the primary driver for the popularity of private limited
companies’ amongst the NRIs and Foreign Nationals.
The opening of a Branch Office
Opening a branch office indeed requires the approval from RBI and is a very cumbersome process when compared to the incorporation of a private
limited company. Further, only the well-established businesses possessing a good track record regarding finances are allowed to open a branch
office in India. Thus, entry into India through the establishment of a Branch Office has indeed been much preferred by the Foreign Nationals and
NRIs.
Registration of LLP
Before November 2015, investment in LLP by NRI or Foreign Nationals required Government approval. It made LLP incorporation involving the
Foreign Nationals/NRIs a long, cumbersome and expensive process. Thus, Private Limited company registrations were preferred over LLP
registration by NRIs and Foreign Nationals. With the relaxation in the FDI norms in November 2015; LLP registration can be done easily by NRIs
and Foreign Nationals making it an ideal investment vehicle for the purpose of establishing a small business in the country of India with foreign
direct investment.

LLP Registration Process for NRIs and Foreign Nationals

A minimum of two persons are required to form an LLP in the country of India; It has been recommended that at least one of the Partners of the
LLP be both an Indian Citizen and Indian Resident- similar to the requirement for registration of a company in India.
The overall process for LLP registration is done in five major steps which are listed below:
 Step 1: Digital Signature id obtained for the Partners. It takes 1-3 days.
 Step 2: DPIN is obtained for partners. It takes 1-2 days.
 Step 3: Name approval is obtained for the LLP from the Indian Government. This process may take 1-7 days.
 Step 4: Incorporation application is filed with the Government. It takes 1-7 days.
 Step 5: LLP Agreement is filed within 30 days of incorporation with the Government.
Digital Signature Certificate
Digital Signature Certificate (DSC) has to be obtained for the proposed Partners of the LLP. DSC is necessary for obtaining the Designated Partner
Identification Number (DPIN). To obtain the DSC, the NRI or Foreign National must submit the signed DSC application along with the notarized
copy of the Passport and Address Proof like Driver’s License.

Designated Partner Identification Number

The Partners in an LLP are strictly required to possess Designated Partner Identification Number (DPIN) and it is easily obtainable once DSC is
obtained by the particular Partner. DPIN can be used with Director Identification Number (DIN) which is used in the incorporation of a company.

Name Approval for the incorporated LLP

After the DPINs are available, an application for the reservation of name of the LLP can be made to the Ministry of Corporate Affairs (MCA). This
application for the name can contain up to six names that are acceptable as per the LLP Act, 2008. The name must necessarily be unique as per the
norms in the LLP Act and must be similar to the existing company or LLP name, If any of the names is approved, then the incorporation application
can be filed within 60 days to complete the process of incorporation.

Incorporation of LLP
Once the name approval is completed, based on the name approval provided by the Government; the Partners of the LLP can submit an application
for the incorporation of LLP to the Government along with the necessary documents including the subscriber’s sheet.
If the application is accepted, MCA will provide an incorporation certificate for the LLP and business can commence after that.

LLP Agreement Filing

On incorporation of the LLP, the LLP Agreement must be signed and filed by the Partners within 30 days. Failure to file the LLP agreement within
the designated time will result in a substantial penalty that accrues on a daily basis. Thus, it is crucial to quickly file the LLP agreement and complete
the overall LLP incorporation process.
Pictorial presentation of Incorporation of LLP: