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Home / RBI Compliance / Overseas Business Setup
Last updated: 2 October 2026
Indian companies can set up or acquire businesses abroad under the Overseas Investment Rules, 2022 — within limits and with reporting through their AD bank. Expertvuw’s team checks eligibility and limits, prepares the documents for the AD bank and coordinates the overseas incorporation.
Under the Foreign Exchange Management (Overseas Investment) Rules and Regulations, 2022, an Indian entity can make overseas direct investment (ODI) in a foreign entity engaged in a bona fide business activity, subject to conditions. Most investments fall under the automatic route through the Indian entity’s AD bank; some require RBI or government approval.
The Indian entity’s total financial commitment — equity, debt and non-fund-based commitments such as guarantees — is generally limited to 400% of its net worth as per the last audited balance sheet. Investments in certain sectors, such as real estate and gambling, are not permitted, and structures that create round-tripping need care.
Before the first remittance, the AD bank obtains a Unique Identification Number (UIN) for the overseas entity. The investment is reported in Form FC, and thereafter Annual Performance Reports and other filings apply.
Basis: FEMA, 1999; Foreign Exchange Management (Overseas Investment) Rules, 2022; FEM (Overseas Investment) Regulations, 2022; RBI Master Direction – Overseas Investment. Last updated: 27 September 2026.
Most ODI is made through the AD bank without prior RBI approval.
Financial commitment is generally capped at 400% of net worth.
The foreign entity must carry on a bona fide business activity.
Real estate business, gambling and certain financial products are restricted.
The AD bank obtains a UIN before the first remittance.
APR by 31 December each year and FLA return annually.
Overseas setup issues often begin before the first remittance.
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Overseas setup connects with these services.
Ongoing APR and reporting.
Setting up a US company.
Setting up in Singapore.
Setting up in a UAE free zone.
Check eligibility, route and limits.
Agree structure and funding.
Pass board resolutions and gather documents.
Coordinate incorporation abroad.
Obtain UIN and remit funds.
File Form FC and set up annual reporting.
The overseas entity brings annual FEMA duties.
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Yes, in most cases under the automatic route through its AD bank, subject to the Overseas Investment Rules.
Total financial commitment is generally limited to 400% of its net worth as per the last audited balance sheet.
A Unique Identification Number for the overseas investment, obtained through the AD bank before the first remittance.
Investment in real estate business abroad is restricted under the Overseas Investment Rules.
The Annual Performance Report by 31 December, the FLA return, and reporting of further investments and changes.
ACS – Director, Expertvuw Management Pvt Ltd
FEMA filings are prepared by Expertvuw’s team. Certificates required by the AD bank or RBI are issued by independent practising professionals, and representation before RBI or the Directorate of Enforcement is made by authorised professionals or advocates.