You would do this through equal ownership of the shares of each company. Your Indian "partners" are permitted to own shares of the US company. Your allowed percentage ownership of the Indian company depends on the foreign ownership rules that India imposes on each sector, and whether you are an NRI. Then you will have to decide the most favorable relationship between the two entities, and decide on operating procedures partly driven by US and Indian tax laws. The initial steps can get complicated, and missteps in US-India business structures can be very costly. I advise that you work with a law firm that is experienced at handling US-India business matters.
Our firm regularly advises companies on such matters, and maintains an Of Counsel in New Delhi on our staff. If you would like to discuss this further with me, please send me an email.
Nothing in this post should be construed as legal advice or as creating an attorney-client relationship. Do not rely on the opinions expressed in this post without discussing them with your attorney. Legal advice must be tailored to unique circumstances and this post is for general purposes only.
Although Mr. Moreno gave good advice from an immigration standpoint ... I have a different perspective here ...... you didn't mention anything about your status, nor whether or not your partners have any desire to come to the US.
Thus, as a purely business matter, you need to look at international banking, taxation and other issues ... meet with an international business attorney.
PROFESSOR OF IMMIGRATION LAW for over 10 years -- This blog posting is offered for informational purposes only. It does not constitute an attorney-client relationship. Also, keep in mind that this is an INTERNET BLOG. You should not rely on anything you read here to make decisions which impact on your life. Meet with an attorney, via Skype, or in person, to obtain competent personal and professional guidance.
You are free to do business with whoever you want but you are treading on matters that involve both domestic business law in the state you do your business and possibly international law. Consult with an experienced business law attorney in Texas. I don't know why you want this international partnership but my experience most people do these things because they want the other partners to invest money. Sometimes it is better to forgo the money and keep you business independent. Discuss all aspects of this venture with an attorney. Any time you rely on the money of others for your business you risk a takeover in the future which ousts you completely. http://www.portlandlegalservices.com/
The comments by this author to questions posted on Avvo are designed to foster a general understanding of what might be the law governing the area of the legal problem stated and suggest what might be the approach to finding a legal solution. Under no circumstances is this author acting as the attorney for the party who posted the question or as the attorney for subsequent readers to the question or response and no attorney client relationship is being formed. This attorney's comments are not intended to be a substitute for getting legal advice from a licensed attorney. A reader of this author's comments should never act on the information provided in these comments as though these comments were legal advice and should always seek legal advice in a personal consultation with an attorney in their jurisdiction before taking action. The information provided here is not intended to cover every situation with similar facts. Please remember that the law varies between states and other countries and is always changing through actions of the courts and the Legislature.
All counsels gave you correct advice. I would add he following. You can certainly form a firm here in the US. Firs you need to determine whether a pass through entity of not. Then you need to determine the state of incorporation. This is relevant under many aspects. You need to ask yourself who will be your customers? Where your services will be sold? Legal and tax consequences derive from this determination. Then you say 'I will be managing all the legal matters here as needed': unless you are an attorney trained and licensed here in the US, I do not see how can you do this. Then, if you are, my second question is why then are you posting this question? I understand that probably you need guidance.
From your second question it seems you lack knowledge of the mechanics. Once you form your US company you need to decide whether you want to participate personally or through your Indian company. The decision is important and has legal and tax consequences. Moreover, remitting income overseas has a special procedure. Sending dividend overseas or taking accounts of losses is another very delicate task. My recommendation is to avoid to engage in self help and work with an attorney and CPA with knowledge in this complex field. Good luck.
This reply is offered for educational purpose only. You should seek the advice of an attorney. The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The response does not form an attorney-client relationship, nor is it intended to be anything other than an educated opinion of the author. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the undisclosed individual asking the question. To the extent additional or different facts exist, the response might possibly change. Attorney is licensed to practice law only in the State of New York. Responses are based solely on New York Law unless stated otherwise. Pursuant to Internal Revenue Service guidance, be advised that any federal tax advice contained in this written or electronic communication is not intended or written to be used and it cannot be used by any person or entity for the purpose of (i) avoiding any tax penalties that may be imposed by the Internal Revenue Service or any other U.S. Federal taxing authority or agency or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.
Good answers here. My high-level issues would surround this like:
- Does a partnership make good business sense?
- What risk are you willing to take for legal liability (here and in India)?
- What are your revenue and income projections (here and in India)?
- What tax advantages are you interested in getting?
- What is your pricing and payment structure, if any, between you and your partner.
As the answers above indicate, you have several attorneys that you can chat with for free consultations on your question. This will give you broader knowledge of your options.
So reach out and get those consultations!
Total Mobility Law is an international law firm that lets companies do global business with the knowledge and confidence they need to comply in any country. Our answers on this site do not constitute legal advice, nor do they establish an attorney-client relationship. The only thing that can do that is a signed Engagement Letter and Fee Agreement, which you can get by contacting us through www.totalmobilitylaw.com.