Companies Act Section 382

Companies Act, Section 382: Display of Name and Related Information by Foreign Companies

Section 382 of the Companies Act, 2013 prescribes mandatory disclosure and display requirements for foreign companies operating in India, with the aim of promoting transparency and ensuring that stakeholders can easily identify such companies and understand their legal standing. This section requires foreign companies to visibly display their identity and liability status at their business premises and on official communications.

1. Obligation to Display the Company Name and Country of Incorporation at Business Premises

Every foreign company carrying on business in India is required to clearly and prominently exhibit its identity at each of its business locations within the country. The following conditions apply:

The name of the company and the country in which it is incorporated must be conspicuously displayed on the outside of every office or place in India where the company carries on its business. The display must be in:
Legible English characters, and the script of the language, or one of the languages, commonly used in the locality where the office or business place is located.
This ensures that the public, including local stakeholders and authorities, can readily identify the foreign company and its origin.

2. Requirement to Include Name and Country of Incorporation on Official Documents and Publications

Foreign companies must ensure that their official documents and communications reflect their identity accurately. Specifically, the company must:

Clearly state the name of the company and the country of incorporation in legible English characters on:
All business letters, billheads, letter paper, all notices and all official publications issued by the company.
This requirement helps ensure that any recipient of official communication or business documentation can identify the company’s foreign origin and legal entity status.

3. Disclosure of Limited Liability Status of Members (If Applicable)

In cases where the liability of the members of the foreign company is limited (i.e., shareholders are not personally liable beyond their shareholding), the company must take additional steps to disclose this legal characteristic. The requirements are as follows:

(i) Inclusion in Official Documents and Communications

The fact that the company’s members have limited liability must be clearly stated in legible English characters in:

Every prospectus issued by or on behalf of the company,
all business letters, billheads, letter paper, notices, advertisements, and any other official publications of the company.
This disclosure provides vital information to investors, customers, and other stakeholders regarding the extent of the financial responsibility of the company’s owners.

(ii) Display at Business Premises

In addition to including the liability status in documents, the company must also conspicuously exhibit the fact that its members’ liability is limited:

On the outside of every office or place where the company carries on business in India, in legible English characters, and in the language or one of the languages in general use in the locality where the office or place is situated.
This visible disclosure reinforces transparency and legal clarity in business dealings.