How to Register an Investment Company in India: Process, SEBI/RBI Compliance and Legal Requirements 

India has established a clearly defined regulatory pathway for foreign investors looking to enter its financial service sector. The registration process is digitalised and integrated and can be handled through MCA’s SPICe+ portal. The structured incorporation process has resulted in foreign businesses following specific guidelines of incorporation.  

This allows foreign businesses to invest capital, particularly in the financial services with ease. For an overseas firm sitting on the question “How to register an investment company in India”, number matters. And, what separates a smooth entry from a prolonged back-and-forth with regulators is knowing the process.   

Regulatory Framework Governing Investment Companies 

Foreign businesses registering an investment company in India report to three regulators. Each owns a distinct part of the compliance picture. 

• Ministry of Corporate Affairs: MCA incorporates your legal entity under the Companies Act, 2013. It is where the process starts. 

• Securities and Exchange Board of India: SEBI governs what your company does once it exists. Investment advisory, portfolio management, and capital market activity all fall under its watch. 

• Reserve Bank of India: RBI manages the foreign investment side under FEMA, 1999. How capital enters, how shares are issued, and how money moves out of your Indian entity are all its jurisdiction. 

All three operate independently but expect simultaneous compliance. Treating them as one integrated obligation from day one is what keeps the process on track. 

Incorporating the Company Under the Companies Act, 2013 

For most foreign businesses, a private limited company is the most practical route. It offers limited liability, a clear ownership structure, and compatibility with SEBI’s registration requirements for investment intermediaries.  

The incorporation process runs through the MCA’s Simplified Proforma for Incorporating a Company Electronically Plus (SPICe+) portal. This form facilitates the reservation of the company name, the allotment of a Director Identification Number, PAN, and TAN, and the filing of the Memorandum of Association and Articles of Association.  

One important note to keep in mind is that when registering, at least one director must be a resident of India. A resident of India is defined as a person who has stayed in the country for at least 182 days in the preceding financial year. Beyond that, both directors and shareholders can be a foreign national. The documents required are: 

• Digital Signature Certificate for all proposed directors.  

• Passport copies and overseas address proof for foreign directors, notarised and apostilled 

• A Memorandum of Association that lists investment advisory services as a principal object 

• Articles of Association governing internal management 

• Registered office proof, which includes a utility bill and a No Objection Certificate from the property owner 

The registrar of Companies issues the Certificate of Incorporation within two to seven business days of a complete submission. After that, two post-incorporation filings become mandatory:  

1. Form INC-20A, a declaration of commencement of business, within 180 days 

2. Form INC-22, a registered office verification, within 30 days 

One procedural point worth flagging early: where a company’s activities require registration or approval from a sectoral regulator such as SEBI or the RBI, that approval must be obtained before commencing those activities, and a declaration confirming this must be submitted at incorporation stage. In practice, this means SEBI and RBI registrations run in parallel with or immediately after the MCA process.  

FDI compliance Under Foreign Exchange management Act, 1999 

Foreign investment in into Indian companies is governed by the Foreign Exchange management Act (FEMA), 1999 and administered by the RBI. For investment advisory services, 100% FDI is permitted under the automatic route. No prior government approvals are required.  

The key compliance requirement for FDI is Form FC-GPR. This form must be filed through the authorised dealer within 30 days of shares being allotted against foreign remittances. The form captures sharing pricing, valuation methodology as per RBI norms, and details of the foreign investors. Shares must be issued within 60 days of receiving funds. If the deadline is not met, the funds must be refunded promptly. 

There are two annual and transaction obligations that apply: 

All of this is handled through the RBI’s FIRMS portal (Foreign Investment Reporting and Management Systems), which supports fully digital submission. Penalties for non-compliance under FEMA can help reach up to three times the contravention amount.  

SEBI Registration as an Investment Adviser 

Getting your company incorporated is step one. But the registration that actually determines whether you can do business as an investment adviser is with SEBI, under the Investment Advisers Regulations, 2013. If your firm charges fees for advising clients on securities, this registration is not optional. 

What changed in 2024 and why it matters for you 

The SEBI (Investment Advisers) (Second Amendment) Regulations, 2024 came into effect in December 2024 and quietly removed some of the more restrictive entry barriers. Here is what is different now: 

• The net worth requirement no longer applies. Instead, you maintain a deposit with BSE Ltd (acting as IAASB), scaled to your client base rather than a fixed capital figure 

• A graduate degree in finance, commerce, economics, banking, capital markets, or a related field now meets the educational bar. The postgraduate requirement is gone 

• The prior experience requirement for new applicants has been dropped 

What has not changed: NISM-Series-X-A and X-B certifications remain mandatory for your principal officer and every person providing investment advice. 

The registration process, step by step: 

1. Create your login on the SEBI Intermediary Portal through BSE’s IAASB platform 

2. File Form A with complete entity and principal officer information 

3. Submit supporting documents including NISM certificates, educational qualifications, a net worth statement dated within six months, your business plan with risk profiling approach, infrastructure details, and three years of income tax returns 

4. Pay the application fee upfront. It is non-refundable. The registration fee is collected only after approval 

5. SEBI typically takes 30 to 60 days to process applications. Respond to any clarifications promptly to avoid delays 

Once you are registered, the compliance does not stop. Client agreements need Most Important Terms and Conditions clearly included. If your advisory process uses AI tools, that must be disclosed. Your website needs to carry SEBI-mandated disclosures, and audit findings must be made available. Fee structures are capped at 2.5% of Assets Under Advice per annum per client family, or a fixed fee, whichever works out higher. 

Portfolio Manager Registration 

Foreign entities that want to actively manage client portfolios rather than simply provide advice will need to pursue a separate registration as a Portfolio Manager under the SEBI (Portfolio Managers) Regulations, 2020. This pathway carries higher entry thresholds than the Investment Adviser route, both in terms of financial requirements and operational infrastructure. 

Portfolio managers must demonstrate considerably greater financial depth, meet NISM-Series-XII certification requirements for principal officers, and submit detailed documentation of their investment strategies and client agreement frameworks. Many foreign businesses entering India for the first time opt to begin with Investment Adviser registration and expand into portfolio management once they have established operational footing. 

Ongoing Compliance Across Three Regulators 

Running an investment company in India means reporting to three regulators on a structured, recurring basis. The table below consolidates the key obligations: 

Foreign entities entering from 2026 onwards should note that SEBI’s updated circulars have introduced flexibility on fee mode switching and deposit compliance timelines. The broader direction of regulatory movement has been towards simplification, but the reporting cadence itself has not changed. Building a compliance calendar from day one, rather than treating it as an afterthought, saves considerable administrative friction down the line. 

Additional Registrations Worth Noting 

Two more registrations come into play as your operations grow, and both are easy to overlook when the focus is on MCA incorporation and SEBI approval. Getting ahead of them early prevents unnecessary friction down the line. 

• GST Registration becomes mandatory once annual turnover from advisory services crosses the applicable threshold. Registering early, even before you hit that threshold, means cleaner invoicing and the ability to claim input tax credit from the start. 

• Authorised Dealer (AD-I) Bank Account is non-negotiable for any foreign exchange movement, whether that is FDI inflows, profit repatriation, or fee receipts from non-resident clients. Open this account alongside incorporation, not after, to avoid delays in share allotment. 

One tool worth adding to your setup is the DPIIT’s National Single Window System (NSWS). It brings FDI-related approvals across multiple ministries into one place, which cuts down the administrative load of managing separate portals considerably. 

Cost and Timeline: How to Register an Investment Company in India Without Delays 

Budgeting for market entry is easier when the numbers are laid out plainly. The costs involved in setting up an investment company in India are relatively contained at the registration stage, but the timeline requires patience, particularly through the SEBI review window. The table below breaks down what to expect at each phase:  

*Prices are indicative. Check Government portal. 

Annual compliance costs, covering audits, MCA filings, SEBI reports, and FLA returns, typically fall between USD 8,000 and USD 15,000 depending on the scale of operations. 

Conclusion 

India’s investment sector is no longer a difficult market to crack for foreign businesses. It is a structured opportunity, and the regulatory architecture, while multi-layered, has been deliberately designed to channel serious capital rather than obstruct it. 

What separates firms that establish themselves smoothly from those that struggle is rarely the complexity of the rules. It comes down to preparation. For anyone researching how to register an investment company in India, engaging qualified legal and compliance professionals early, building a reporting calendar before the first transaction, and treating regulatory alignment as a core business function will determine how quickly a registered entity becomes an operational firm.  

If you have any questions regarding the process of incorporation, registration, or compliance, get in touch with the professionals at Stratrich Consulting.