FOREIGN SUBSIDIARY FORMATION – CASE STUDY

European specialty chemical manufacturer with direct subsidiaries decided to branch out in the country. An independent subsidiary with 100 percent ownership of the parent company was to be created in the country from the scratch.

After a few market visits and meetings, the regional office initiated the process of interviewing experts and business development companies to assign the project. The company formation was contemplated as a turnkey project to be contracted out entirely with an end-to-end solution. This independent local company was to be delivered up and running with all aspects of a new import and distribution company covered for and completed. This was to be successfully achieved by fully complying with the country’s complex corporate laws and aligned with the parent company’s policies regarding its international subsidiaries. GTI Partner’s business development services were retained for the task through a service contract and POA agreement to accomplish the following tasks locally and in line with the company’s international subsidiary policy:

• To form a foreign owned independent local subsidiary company through Company Registry and Tax Offices
• To create multi-currency corporate bank accounts without bank signatory travel in line with all banking requirements
• To submit and have registered the trademark application for the brand with the country’s Intellectual Property Office
• To apply for and have registered the business and VAT ID numbers along with company’s book of records with local TAX Authorities
• Interview, select and contract out services of a Country Manager, Customs Clearing and Import Agent with the approval of head office
• To apply for and obtain import and business licenses and have registered with Industry Trade Promotion Agency and Association
• To secure lease of a functioning office and a full-service warehouse locations and have them registered with authorities as required by law
• To put together country specific product portfolio and initial inventory through product/price benchmark in collaboration with the head office
• To finalize logistics, import and custom clearance of the first shipment of products for initial inventory delivered to the warehouse