Foreign national as director of the Company
Suchitra. S
(Querist) 05 July 2011
This query is : Resolved
Respected experts, please let me know whether a foreign national can become the Director of a Company. If yes, under which provision of law.
Bovan Cherian Varkey
(Expert) 05 July 2011
There is no bar in inducting a foreigner as a Director of the Company, provided he has to follow all procedures to be followed by an Indian
A V Vishal
(Expert) 05 July 2011
1. Can a Foreign national Become director in an Indian Company
Yes, Foreign National can become director in Indian Company
2. Does Appointment of foreign Directors Require RBI Approval
No, RBI has clarified that under the Foreign Exchange Management Act, 1999, appointment of a foreign national as a director on the board of directors of an Indian company does not require the Reserve Bank’s approval.
3. Can all the directors of Indian Company be foreign National
Yes, An Indian company can have all the directors as foreign nationals
4. Payment of Sitting Fees , Remuneration and other charges require RBI Approval
No, It is clarified that the Reserve Bank has also granted general powers to an Indian company to make payment in rupees towards sitting fees or commission or remuneration and travel expenses to and from and within India to its non-whole time director who is resident outside India and is on a visit to India for the company’s work.
5. What are the minimum formalities to become a director in Indian Company.
To become director in Indian company the directors should have
Directors Identification Number
Digital Signature Certificate
6.Does Foreign Directors also Require Directors Identification Number – DIN
Yes, Every Director whether foreign or Indian should have DIN
7. What Documents Required for Foreign Directors DIN
For DIN of Foreign Directors the proof of Identity and Proof of Residence are required , Both shall be either duly notarized or shall be certified by Indian Embassy in the country of residence.
8. Does Foreign Directors Require Digital Signature Certificate– DSC
Yes, Like any other director foreign Director shall have a DSC.
9. Any other disclosure requirement by foreign directors
Yes, Like any other directors the foreign directors of the Indian company has to disclose the list of all the company, firms in which they are directors or they are interested.
Suchitra. S
(Querist) 05 July 2011
Vishal Sir, is thanks for the reply. Please let me know if there is any specific provision that prohibits a Pakistani or Bangladeshi national to be a Director of Indian Company. We are dealing with one Pakistani national who wants to be a Director and being denied by the approval of Company Secretary.
Advocate. Arunagiri
(Expert) 05 July 2011
Please tell us whether the company is Public limited or private limited. The provisions differs for both.
Amit Soni
(Expert) 05 July 2011
The provisions related to DIN applies equally to the private & public company.
A V Vishal
(Expert) 05 July 2011
THERE IS NO SUCH PROVISION UNDER FEMA OR COMPANIES ACT BARRING APPOINTMENT OF A PAKISTANI OR BANGLA DESHI, HOWEVER, THE C S CANNOT REFUSE IF THERE IS SOME PROBLEM WITH APPOINTMENT OF SUCH INDIVIDUAL THE ROC MAY RAISE OBJECTION.
Suchitra. S
(Querist) 06 July 2011
Thank you everyone for their prompt replies, specially Vishal Sir for updating me regarding the query.
