Indian Subsidiary Company Registration in Chennai – Complete Guide for Foreign Companies

India has become an important destination for foreign businesses looking to expand their operations, access a large customer base, establish technology and service centres, manufacture products, and build long-term business operations. Chennai is one of the leading cities for establishing an Indian subsidiary because of its strong industrial ecosystem, technology sector, automobile industry, healthcare sector, logistics infrastructure, skilled workforce, ports, and growing startup environment.

Foreign companies planning to establish a business presence in Chennai can consider setting up an Indian subsidiary company. An Indian subsidiary provides a separate legal structure through which a foreign parent company can conduct business activities in India, subject to applicable corporate, foreign exchange, taxation, sector-specific, and regulatory requirements.

Indian subsidiary registration in Chennai generally involves incorporating an Indian company under the Companies Act, 2013 and complying with applicable foreign investment regulations. Depending on the ownership structure and applicable sectoral rules, a foreign company or foreign investors may establish a wholly owned subsidiary or another appropriate subsidiary structure in India.

This comprehensive guide explains the meaning of an Indian subsidiary, eligibility requirements, ownership structure, documents, incorporation process, FDI considerations, taxation, ongoing compliance, approximate costs, advantages, and important considerations for foreign businesses planning to establish an Indian subsidiary in Chennai.

What Is an Indian Subsidiary Company?

An Indian subsidiary is an Indian incorporated company that is controlled by another company, generally referred to as the parent company. The parent company may be located outside India, and the Indian company operates as a separate legal entity under Indian law.

A subsidiary incorporated in India can enter into contracts, maintain a bank account, employ staff, lease office premises, purchase assets, provide services, invoice customers, and conduct other permitted business activities in its own name.

One common structure used by international businesses is a wholly owned subsidiary, where the foreign parent company owns the entire permitted shareholding of the Indian company. However, foreign ownership is subject to India's foreign direct investment rules, sectoral caps, entry routes, and other applicable regulations.

For example, a technology company headquartered in the United States may establish an Indian subsidiary in Chennai to provide software development, customer support, research and development, consulting, or other permitted services. The Indian company would be incorporated separately and would have its own directors, books of accounts, tax registrations, contracts, employees, and compliance obligations.

Why Establish an Indian Subsidiary in Chennai?

Chennai is one of India's major commercial and industrial centres. The city has a diversified economy covering information technology, software services, automobile manufacturing, electronics, healthcare, financial services, logistics, engineering, education, renewable energy, and professional services.

For an overseas business, Chennai can provide access to a large talent pool and established business infrastructure. The city is also connected to international markets through its airport and port infrastructure.

Foreign businesses may consider Chennai for several reasons:

• Access to skilled technical and professional employees.
• Strong information technology and business services ecosystem.
• Established automobile and manufacturing industries.
• Availability of engineering and technical talent.
• Strong logistics and transportation infrastructure.
• Access to customers in South India.
• Established network of professional service providers.
• Availability of commercial and industrial facilities.
• Growing startup and technology ecosystem.
• Potential to establish an India-based delivery or operations centre.

The suitability of Chennai depends on the nature of the foreign company's business, target customers, employee requirements, operating costs, regulatory requirements, and long-term expansion plans.

Indian Subsidiary vs Branch Office vs Liaison Office

Foreign companies entering India may consider different structures depending on their objectives. An Indian subsidiary, branch office, and liaison office have different legal and operational characteristics.

Indian Subsidiary

An Indian subsidiary is a separate Indian company. It can generally conduct the business activities permitted under its constitutional documents and applicable laws. It can enter into contracts and generate revenue in India, subject to applicable regulations.

Branch Office

A branch office is an extension of the foreign company rather than a separate Indian company. Its permitted activities are subject to applicable regulations and approvals.

Liaison Office

A liaison office is generally established for activities such as communication and coordination between the foreign parent company and Indian businesses or customers. It is not normally intended to conduct commercial trading activities in India.

The appropriate structure depends on the intended activities, ownership requirements, funding model, taxation, regulatory permissions, and business objectives. Professional advice should be obtained before selecting the structure.

Who Can Register an Indian Subsidiary?

A foreign company or foreign investor may establish an Indian company subject to the Companies Act, applicable foreign direct investment regulations, sector-specific rules, and other requirements.

Foreign investment in India can be subject to either the automatic route or the government approval route depending on the sector, investment percentage, and applicable regulations.

Before incorporation, the proposed business activity should therefore be reviewed carefully. Certain sectors may have specific ownership limits, licensing requirements, security-related conditions, or other restrictions.

For many conventional business activities, foreign investors may establish an Indian company under the applicable automatic route, subject to compliance with the prescribed conditions. However, the rules can change, and the applicable position should be checked at the time of incorporation.

Wholly Owned Subsidiary in India

A wholly owned subsidiary, commonly called a WOS, is an Indian company whose permitted shareholding is entirely held by its foreign parent or foreign investors.

A WOS can be attractive to international businesses that want greater control over their Indian operations. However, ownership must always comply with the applicable foreign investment rules.

A typical structure may look like:

Foreign Parent Company → Indian Subsidiary Company → Indian Business Operations

The Indian subsidiary maintains its own corporate identity, accounting records, bank account, contracts, employees, and statutory filings.

Basic Requirements for Indian Subsidiary Registration in Chennai

The exact requirements can vary depending on the proposed ownership structure and business activity. Some common requirements include:

• At least two members for a private limited company.
• At least two directors for a private limited company.
• At least one director ordinarily resident in India, subject to the applicable Companies Act requirements.
• A registered office address in India.
• Digital Signature Certificates for relevant subscribers and directors.
• Director Identification Numbers where applicable.
• Company name approval or reservation through the applicable incorporation process.
• Memorandum of Association and Articles of Association.
• Identity and address documents of shareholders and directors.
• Corporate documents of the foreign parent company where applicable.
• Appropriate foreign investment documentation.

Documents Required for Foreign Shareholders

Foreign shareholders generally need to provide documents proving their identity, address, corporate existence, and authority to invest in the Indian company.

Depending on whether the shareholder is an individual or a foreign corporate entity, documents may include:

• Passport or equivalent identity document for foreign individual shareholders.
• Proof of residential address.
• Certificate of incorporation of the foreign parent company.
• Memorandum and Articles or equivalent constitutional documents.
• Board resolution approving investment in the Indian subsidiary.
• Authorisation for the person subscribing to shares.
• Registered office proof of the foreign parent.
• Beneficial ownership information where required.
• Documents required under applicable KYC and foreign investment rules.

Documents executed outside India may require notarisation, apostille, consularisation, or other authentication depending on the country in which they are executed and the applicable Indian requirements.

Documents Required for Directors

Indian and foreign directors may need to provide different supporting documents depending on their nationality and residential status.

Common documents may include:

• Passport-size photograph.
• Passport or identity proof.
• Residential address proof.
• Digital Signature Certificate.
• Director-related declarations and consent.
• Other incorporation documents prescribed by the Ministry of Corporate Affairs.

Foreign nationals should ensure that their documents are properly authenticated before submission.

Role of the Resident Director

One important consideration for an Indian subsidiary is the requirement relating to a director who satisfies the applicable resident director condition under the Companies Act.

The resident director requirement is important because a foreign parent may have directors located entirely outside India. The Indian subsidiary must nevertheless meet the statutory director requirements applicable to Indian companies.

The resident director should be properly appointed and the company should maintain appropriate corporate records relating to the appointment.

Step-by-Step Process for Indian Subsidiary Registration in Chennai

Step 1: Decide the Business Structure

The first step is to determine the appropriate Indian entity. A private limited company is commonly considered for subsidiary structures because it provides a separate legal identity and a structured shareholding framework.

The proposed ownership should also be reviewed against applicable FDI rules.

Step 2: Identify the Business Activity

The proposed business activities should be clearly identified before incorporation. This is important because certain industries may have additional licensing requirements or foreign investment restrictions.

Step 3: Determine the Shareholding Pattern

The proposed shareholders and percentage ownership should be determined. If the foreign parent intends to own the entire permitted shareholding, the structure may be designed as a wholly owned subsidiary.

Step 4: Select the Company Name

A suitable company name should be selected according to the naming requirements applicable to Indian companies.

The proposed name should not conflict with existing company names, trademarks, or other restricted names.

Step 5: Obtain Digital Signatures

Digital Signature Certificates are generally required for individuals who need to digitally sign incorporation documents.

Step 6: Obtain Director Identification Number

The applicable incorporation process includes obtaining or associating the required director identification details.

Step 7: Prepare Incorporation Documents

The incorporation documents generally include the company's constitutional documents and declarations relating to subscribers and directors.

Step 8: File Incorporation Application

The incorporation application is submitted through the applicable Ministry of Corporate Affairs system along with the required supporting documents.

Step 9: Registrar Review

The Registrar of Companies reviews the incorporation application and supporting documents. If clarification or additional information is required, the applicant may need to respond within the prescribed period.

Step 10: Certificate of Incorporation

After successful approval, the company receives its Certificate of Incorporation. The company then becomes a separate legal entity under Indian corporate law.

Step 11: PAN and TAN

The newly incorporated company requires appropriate tax registrations, including Permanent Account Number and Tax Deduction and Collection Account Number where applicable.

Step 12: Open a Corporate Bank Account

The company can proceed with opening a bank account after satisfying the bank's KYC and documentation requirements.

Step 13: Bring Foreign Investment

Foreign capital should be received in accordance with the applicable foreign exchange and foreign investment rules. The relevant reporting requirements must also be completed.

Step 14: Commence Business Operations

After completing the applicable registrations and operational requirements, the company can begin its business activities in India.

Foreign Direct Investment Considerations

Foreign investment is an important part of subsidiary registration when the shareholders are located outside India. Foreign investment in India is governed by a combination of foreign exchange regulations, FDI policy, sector-specific rules, and reporting requirements.

The applicable rules depend on factors such as:

• Nature of the business activity.
• Percentage of foreign ownership.
• Nationality and jurisdiction of the investor.
• Applicable sectoral cap.
• Automatic or government approval route.
• Pricing and valuation requirements.
• Reporting requirements.

Because FDI regulations can be updated, foreign businesses should verify the applicable rules at the time of making the investment rather than relying on older incorporation information.

Capital Requirement for an Indian Subsidiary

There is no universal high minimum paid-up capital requirement applicable to every private limited company merely because it has a foreign shareholder. The appropriate capital structure should instead be determined based on the company's business model, operating requirements, funding requirements, and applicable regulatory requirements.

Foreign investors should also consider the amount required to fund initial expenses such as office rent, salaries, professional fees, technology, marketing, equipment, and working capital.

Taxation of an Indian Subsidiary

An Indian subsidiary is generally treated as an Indian company for tax purposes and is subject to applicable Indian taxation laws.

The company's tax obligations may include corporate income tax, Goods and Services Tax where applicable, tax deducted at source, and other applicable taxes and statutory payments.

The actual tax rate and tax treatment depend on factors such as the company's tax regime, business activity, income, deductions, incentives, transactions, and applicable law for the relevant financial year.

GST Registration for an Indian Subsidiary

An Indian subsidiary may need GST registration depending on the nature and value of its taxable supplies and the applicable GST rules.

GST registration may be relevant when the subsidiary provides services or sells goods in India, subject to applicable registration thresholds and compulsory registration provisions.

For example, a foreign technology company establishing a Chennai subsidiary to provide software services to Indian customers may need to evaluate GST registration and ongoing GST compliance.

TDS Compliance

An Indian subsidiary making specified payments may be required to deduct tax at source. This can include payments such as salary, professional fees, contractor payments, rent, interest, and other specified transactions.

The company should maintain appropriate records and comply with applicable TDS deduction, deposit, return filing, and certificate requirements.

Accounting and Bookkeeping

Maintaining accurate accounting records is essential for an Indian subsidiary.

The company should maintain records of:

• Sales and service revenue.
• Purchase transactions.
• Bank transactions.
• Employee expenses.
• Professional fees.
• Inter-company transactions.
• Foreign currency transactions.
• Fixed assets.
• Loans and advances.
• Taxes and statutory payments.

Proper bookkeeping also helps the company prepare financial statements and complete statutory and tax compliance.

Transfer Pricing for Indian Subsidiaries

Transfer pricing can become important when an Indian subsidiary has transactions with its foreign parent company or other associated enterprises located outside India.

Examples may include:

• Management service fees.
• Software development services.
• Technical services.
• Royalty payments.
• Cost reimbursements.
• Loans or financial arrangements.
• Purchase or sale of goods.
• Shared service arrangements.

Such transactions may need to comply with Indian transfer pricing rules. Documentation and reporting requirements can apply depending on the nature and value of transactions.

Annual Compliance for an Indian Subsidiary

Registration is only the beginning of the company's legal existence. An Indian subsidiary must continue meeting applicable annual and periodic compliance requirements.

Common corporate compliance activities may include:

• Maintenance of statutory registers.
• Board meetings.
• Annual general meeting requirements.
• Preparation of financial statements.
• Statutory audit.
• Annual return filing.
• Income tax return filing.
• GST return filing where applicable.
• TDS return filing where applicable.
• Foreign investment reporting where applicable.
• Director-related compliance.
• Other sector-specific registrations and returns.

The exact compliance calendar depends on the company's size, business activity, transactions, registrations, and applicable legal requirements.

Audit Requirements

Companies incorporated in India are generally subject to statutory audit requirements under applicable corporate law. The subsidiary should appoint an eligible statutory auditor and ensure that financial statements are prepared in accordance with applicable accounting requirements.

Additional audits or certifications may be required depending on tax, GST, transfer pricing, foreign investment, or sector-specific rules.

Banking and Foreign Currency Transactions

An Indian subsidiary with a foreign parent may receive funds from overseas. Foreign currency transactions must comply with applicable foreign exchange regulations and banking procedures.

The bank may request incorporation documents, shareholder documents, foreign investment information, board resolutions, KYC documents, and other supporting records.

The company should maintain proper records for all inward and outward remittances.

Registered Office in Chennai

An Indian subsidiary must maintain a registered office in India as required under the Companies Act.

The registered office can be a commercial office or another permitted address supported by appropriate documentation. The address should be capable of receiving official communications.

Businesses planning to establish their operations in Chennai may choose an office based on factors such as accessibility, employee requirements, customer proximity, industry ecosystem, and operating costs.

Can a Foreign Company Fully Own an Indian Subsidiary?

A foreign company can own an Indian subsidiary to the extent permitted under applicable foreign investment rules. In sectors where 100% foreign ownership is permitted under the applicable route, a foreign parent may establish a wholly owned subsidiary.

However, this should not be assumed for every business. Sector-specific restrictions and approval requirements should be checked before incorporation.

Can an Indian Subsidiary Hire Employees?

Yes. An Indian subsidiary can generally employ individuals in India subject to applicable employment, labour, payroll, tax, social security, and other regulations.

Depending on the employee profile and applicable thresholds, the company may need to consider registrations or compliance relating to provident fund, employee state insurance, professional tax, labour welfare requirements, gratuity, payroll tax deduction, and other employment laws.

Can the Indian Subsidiary Invoice the Foreign Parent?

An Indian subsidiary may provide services to its foreign parent company, depending on the nature of the business arrangement and applicable laws.

For example, an Indian subsidiary may provide software development, back-office support, research services, consulting, engineering, or other permitted services to the foreign parent.

Such transactions should be structured carefully because they may involve GST, transfer pricing, foreign exchange, taxation, and documentation requirements.

Export of Services from India

Many foreign-owned Indian subsidiaries provide services to overseas customers or their parent companies.

Depending on the facts of the transaction, such services may qualify as export of services under GST law. The company must evaluate the relevant conditions and comply with applicable documentation and reporting requirements.

Benefits of Setting Up an Indian Subsidiary

Establishing an Indian subsidiary can provide a structured platform for foreign companies that want to build a long-term Indian operation.

Separate Legal Identity

The subsidiary is a separate legal entity from its foreign parent. This allows the Indian operation to enter into contracts and conduct business in its own corporate identity.

Local Business Operations

The subsidiary can establish offices, hire employees, work with vendors, enter customer contracts, and develop operations in India subject to applicable law.

Business Expansion

A formal Indian entity can provide a structure for expanding operations across Indian cities and states.

Access to Indian Customers

A local company may help foreign businesses establish a direct operating presence in the Indian market, subject to the requirements applicable to their industry.

Access to Indian Talent

Chennai has a large pool of engineers, software professionals, finance professionals, healthcare professionals, and other skilled workers.

Long-Term Presence

Unlike a temporary market exploration arrangement, a subsidiary can be structured as a long-term operating company in India.

Industries That May Consider a Chennai Subsidiary

Businesses across multiple sectors may evaluate Chennai for their Indian operations.

• Information technology.
• Software development.
• IT-enabled services.
• Automobile and automotive components.
• Engineering services.
• Electronics.
• Healthcare.
• Medical technology.
• Logistics.
• Manufacturing.
• Consulting.
• Financial technology.
• Research and development.
• Education technology.
• Business process outsourcing.

Each industry may have different licensing and foreign investment considerations.

Cost of Indian Subsidiary Registration in Chennai

The total cost of setting up an Indian subsidiary depends on several factors. There is no single fixed price applicable to every foreign-owned company.

Costs may include:

• Government incorporation fees.
• Stamp duty.
• Digital Signature Certificate charges.
• Professional incorporation fees.
• Document notarisation or apostille expenses.
• Legal and documentation costs.
• Accounting and tax registration costs.
• Bank account setup-related expenses.
• Registered office expenses.
• Ongoing compliance costs.

Foreign companies should also budget for recurring expenses after incorporation rather than considering only the initial registration cost.

Timeline for Subsidiary Registration

The incorporation timeline depends on document readiness, name availability, government processing, foreign document authentication, business activity, and whether additional approvals are required.

If all documents are prepared correctly and no additional approval is required, incorporation may be completed relatively quickly. However, foreign-owned companies should allow additional time for apostille, notarisation, bank KYC, foreign investment procedures, and other post-incorporation formalities where applicable.

Common Mistakes to Avoid

Choosing the Wrong Business Activity

The business activity stated during incorporation should accurately reflect the company's intended operations.

Ignoring FDI Rules

Foreign investment regulations should be reviewed before deciding the ownership structure.

Incomplete Foreign Documents

Foreign corporate documents may require authentication or apostille. Missing authentication can delay incorporation.

Ignoring Post-Incorporation Compliance

Incorporation does not eliminate the requirement for annual and periodic compliance.

Poor Accounting Setup

International groups should establish appropriate accounting processes from the beginning, particularly where inter-company transactions are expected.

Not Planning Transfer Pricing

Where the Indian subsidiary will transact with its foreign parent, transfer pricing considerations should be addressed before commercial operations begin.

Mixing Parent and Subsidiary Transactions

The Indian company and foreign parent should maintain separate books, contracts, invoices, bank accounts, and corporate records.

Indian Subsidiary Compliance Checklist

A foreign company establishing a subsidiary in Chennai can use the following checklist as a general planning reference:

• Determine the Indian business structure.
• Review FDI eligibility.
• Check sector-specific restrictions.
• Determine shareholders.
• Identify directors.
• Arrange resident director requirements.
• Prepare foreign parent documents.
• Authenticate foreign documents where required.
• Obtain digital signatures.
• Select company name.
• Prepare incorporation documents.
• File incorporation application.
• Obtain Certificate of Incorporation.
• Obtain PAN and TAN.
• Open bank account.
• Bring in foreign investment according to applicable rules.
• Complete foreign investment reporting.
• Obtain GST registration if applicable.
• Set up accounting and payroll.
• Register for applicable employee-related compliances.
• Appoint statutory auditor.
• Maintain statutory records.
• Complete annual ROC filings.
• File income tax returns.
• Complete GST and TDS compliance where applicable.
• Review transfer pricing requirements.

Why Professional Assistance Can Help

Indian subsidiary incorporation can involve several areas of law and compliance. Foreign companies may need to coordinate corporate incorporation, foreign investment, taxation, accounting, GST, payroll, transfer pricing, banking, and annual compliance.

Professional assistance can help coordinate these activities and reduce administrative complexity.

A professional service provider can assist with activities such as:

• Company structure evaluation.
• Company name and incorporation documentation.
• Digital signature coordination.
• Preparation of incorporation forms.
• Foreign document review.
• GST registration.
• PAN and TAN assistance.
• Accounting and bookkeeping.
• Tax compliance.
• ROC annual filing.
• Payroll compliance.
• Transfer pricing coordination.
• Foreign investment compliance support.

Indian Subsidiary Registration in Chennai – Frequently Asked Questions

What is an Indian subsidiary?

An Indian subsidiary is a company incorporated in India that is controlled by another company or shareholder, which may be located outside India. It operates as a separate legal entity under Indian law.

Can a foreign company establish a subsidiary in Chennai?

Yes, a foreign company can establish an Indian subsidiary in Chennai subject to the Companies Act, foreign investment regulations, sector-specific rules, and applicable approvals.

Can a foreign company own 100% of an Indian subsidiary?

100% foreign ownership may be permitted in certain sectors and under applicable investment routes. The applicable sectoral rules should be checked before incorporation.

Is an Indian subsidiary a separate legal entity?

Yes. An incorporated Indian subsidiary generally has a separate legal identity from its foreign parent company.

Does an Indian subsidiary need a registered office?

Yes. An Indian company is required to maintain a registered office in India in accordance with applicable company law requirements.

Does an Indian subsidiary need an Indian director?

The company must comply with the applicable director requirements, including the resident director requirement prescribed under Indian company law.

Is GST registration mandatory for every subsidiary?

Not necessarily. GST registration depends on the nature of activities, turnover, location, taxable supplies, and compulsory registration provisions applicable to the business.

Does an Indian subsidiary need an auditor?

Indian companies are generally subject to statutory audit requirements. The subsidiary should appoint an eligible statutory auditor and comply with applicable audit provisions.

Can the subsidiary hire employees?

Yes. An Indian subsidiary can employ staff in India, subject to applicable employment, payroll, tax, social security, and labour regulations.

Can the Indian subsidiary provide services to its foreign parent?

Yes, subject to applicable corporate, tax, GST, transfer pricing, foreign exchange, and documentation requirements.

Is transfer pricing applicable to a subsidiary?

Transfer pricing rules may apply when an Indian company enters into specified international transactions with associated enterprises. The applicability depends on the relationship and nature of transactions.

How long does Indian subsidiary registration take?

The timeline depends on document readiness, government processing, foreign document authentication, name availability, and whether additional approvals are required.

Indian Subsidiary Registration in Chennai – Final Considerations

Establishing an Indian subsidiary can provide a structured way for an international company to establish business operations in India. Chennai offers a broad commercial ecosystem with technology, manufacturing, engineering, healthcare, logistics, and professional services sectors.

However, subsidiary registration should not be viewed as only a company incorporation exercise. Foreign businesses should plan the complete operating structure, including foreign investment, taxation, accounting, GST, payroll, transfer pricing, banking, corporate governance, and annual compliance.

The appropriate structure depends on the foreign investor's business activity, ownership objectives, expected investment, revenue model, Indian customers, employees, and regulatory requirements.

Before proceeding with incorporation, it is advisable to verify the current foreign investment rules and sector-specific requirements applicable to the proposed business. Regulations can change, so information applicable to an earlier financial year should not automatically be treated as current.

Get Assistance for Indian Subsidiary Registration in Chennai

Taxless can assist businesses planning to establish an Indian subsidiary in Chennai with company incorporation and related compliance requirements.

Depending on the business requirements, support may include company incorporation, documentation assistance, PAN and TAN, GST registration, accounting and bookkeeping, tax compliance, TDS compliance, ROC annual filing, payroll-related compliance, and other business compliance services.

If your foreign company is planning to establish a subsidiary in Chennai, the first step is to understand the proposed business activity, ownership structure, foreign parent details, number of directors, expected investment, and intended operations in India.

With proper planning, documentation, and ongoing compliance management, an Indian subsidiary can provide a formal corporate structure through which a foreign business can establish and operate its Indian business presence.

Conclusion

Indian subsidiary registration in Chennai is an important option for foreign companies seeking to establish a long-term business presence in India. A subsidiary provides a separate Indian corporate structure and can support activities such as hiring employees, entering contracts, providing services, selling products, establishing offices, and expanding operations.

The incorporation process involves selecting the appropriate structure, checking foreign investment rules, preparing shareholder and director documents, incorporating the company with the Ministry of Corporate Affairs, setting up banking and tax registrations, and completing applicable post-incorporation requirements.

After incorporation, ongoing compliance becomes an essential part of operating the subsidiary. Corporate filings, accounting, tax returns, GST, TDS, payroll, audit, foreign investment reporting, and transfer pricing may all need to be considered depending on the company's activities and transactions.

Foreign businesses planning to establish operations in Chennai should therefore evaluate both the incorporation process and the long-term compliance requirements before starting operations. A properly planned subsidiary structure can help create a clear framework for managing the Indian business while maintaining appropriate separation between the Indian company and its foreign parent.