Attracted by the size and diversity of the US economy, many Indian and other companies start a business in the US or acquire or invest in existing companies.
The US has no exchange controls, so long as currency transactions greater than US$10,000 are disclosed, and does not require financial audits of privately owned companies. There are no restrictive laws on closing plants or terminating employees, and only about 10% of the labour force is unionized. Various localities provide tax and financial incentives for creating jobs, building a plant or investing in renewable energy.
Business entities
State laws set the rules for establishing and governing business structures. Foreign businesses usually use a corporation as it is easy to set up, transfer ownership of its shares, and create employee equity incentives. The foreign parent is not liable for debts and obligations of its subsidiary cor-poration. A corporation is governed by a certificate of incorporation, filed in its state of incorporation, and by its bylaws, which are not publicly filed.
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Gautam Khurana is the managing partner at India Law Offices in New Delhi. Brian Jaffe is the principal of the Law Office of Brian H. Jaffe, LLC in New York. The firms collaborate on legal matters arising out of investments and transactions involving Indian and US companies.
D – 19 (GF) & D – 31, South Extension – 1
New Delhi – 110 049
Tel: +91 11 2462 2216, 2462218
Fax : +91 11 2465 4364
Email: g.khurana@indialawoffices.com
