Doing business in India has never been more accessible. The Indian government, the Ministry of Corporate Affairs [‘MCA’] specially, has been hard at work, streamlining regulations and simplifying processes to create a more welcoming environment for businesses. Reducing the number of compliances, de-criminalizing of offences and providing exemption to private companies from major compliance are some of the prominent examples of the government’s efforts towards ease of doing business. This article provides an overview of one of the technology-based initiatives taken by the Central government towards ease of doing business.
In recent years, India has undertaken a series of ambitious reforms, ranging from simplifying regulatory frameworks to digitalizing administrative processes. Some more amongst these reforms are de-criminalization of offences, exemptions to private companies from major compliance, the amendment to the definition of small companies and introduction of SPICE+ form for incorporation of companies. The e-form SPICE+ for the first time provided the facility of obtaining PAN, DIN, and ESOP registration etc. through one single form. This step was considered a big step in the ease of doing business as it saved a lot of time of businesspeople. Now in furtherance of its efforts towards enhancing ease of doing business, MCA has come up with a new update with respect to incorporation of companies and LLPs.
The latest MCA update with respect to the Incorporation of Companies and LLPs:
On October 23, 2023, MCA announced that forms for incorporation of companies and LLPs can be filed through the National Single Window System (NSWS) as well, as MCA has integrated with NSWS to provide an additional option to stakeholders for filing applications for incorporation of company or LLP. In other words, now incorporation application can be filed through two portals. The first is the MCA portal and the second being the National Single Window System (‘NSWS’) portal. The application filed on the NSWS portal shall be forwarded to MCA for further processing.
What is NSWS:
NSWS is a digital platform under the Department of Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce and Industry. This portal is aimed at providing guidance to entrepreneurs with respect to the central and state government approvals required by businesses they are proposing to start and allowing entrepreneurs to apply for same through the NSWS portal. NSWS is an alternative one-stop destination other than the respective ministry’s websites, for obtaining multiple approvals under a single window. This portal is designed, developed, and owned by ‘Invest India’ which is the National Investment Promotion and Facilitation Agency of India, set up as a non-profit venture under the aegis of DPIIT, Ministry of Commerce and Industry.
Services offered by NSWS:
As mentioned above, NSWS is a one-stop destination for obtaining and/or renewing various issued by various union ministries and state governments. The portal provides guidance as to which all approvals will be needed by the stakeholders, based on the information provided by them. Further, the portal also allows the stakeholders to apply for a maximum of such approvals through this same portal. NSWS hosts applications for approvals from thirty-one central departments and twenty-two state governments. Approvals from all these ministries and departments can be made through NSWS portal. In addition to this, the portal also provides information relating to various government schemes which may prove beneficial to businesses. The portal also provides a facility to create a secured document repository. The documents can be ones uploaded and used for making all required applications.
How does NSWS portal work:
As a first step, the entrepreneur is interested in knowing which all approvals will be required by him for starting a specific business. For this purpose, he can use NSWS’s Know Your Approval (KYA) model. A stakeholder is required to answer the various questions about the business model asked by the portal. The questions relate to the nature of the entity to be registered, startup and MSME registrations, number and types of employees, requirement of intellectual property registrations, foreign investments, and taxation-related registrations. Based on answers to these questions, the portal suggests the list of approvals required and indicates which of such approvals can obtained through NSWS. Thereafter the entrepreneur must register on the portal using his email ID and phone number. Thereafter, he should upload all the required documents on the portal and then file the application for relevant approvals by logging in to the portal.
The FAQs provided on the NSWS website clarify two important things. The first one is that the portal itself does not charge any fees for its services, but the application fees charged by the specific ministries for granting approval may be paid through this portal. The second thing is that the portal does not re-engineer any of the processes followed by the ministries for granting approvals. It simply acts as one single window for obtaining multiple approvals and as soon as an application is received, it is forwarded to relevant ministry for further processing. The portal provides a detailed list of union ministries and state governments and approvals granted by them which can be applied for through this portal. As far as MCA is concerned, applications for incorporation of company or LLP, application for obtaining DIN/DPIN, application for commencement of business, and application for registration under independent director databank can be made through this portal.
In furtherance of the government’s efforts towards ease of doing business, the latest announcement from MCA on the integration with the National Single Window System (NSWS) marks yet another remarkable milestone. This collaboration offers businesses a dual portal system for company and LLP incorporation, providing greater flexibility and convenience. Importantly, NSWS does not reinvent ministry processes but serves as a central hub, forwarding applications to the relevant ministries for efficient processing.
As India continues to be a beacon for entrepreneurs and investors, the integration of MCA with NSWS exemplifies the government’s dedication to fostering a thriving business ecosystem. These initiatives not only signify the ease of doing business but also highlight the boundless opportunities awaiting those who choose India as their business destination. The future of business in India is indeed brighter than ever.
The Article is written by Ms. Rutuja Umadikar – Research Associate.