Structuring an India entry services RFP: what to ask before you compare quotes

A foreign company setting up an Indian subsidiary usually collects three to five quotes before picking a service provider. Almost none of those quotes are comparable. One firm quotes a flat fee for incorporation and prices everything else separately. Another bundles the first year of compliance into the incorporation fee and raises the price sharply from year two. A third quotes low because its scope silently excludes FEMA filings that the subsidiary will need within 60 days of receiving capital. The gap is not in vendor quality. It is in the RFP. A request for proposal that does not force firms to answer the same structural questions will get back proposals that cannot be evaluated against each other, and the buyer ends up choosing on price alone, which is the one number in the document least likely to reflect the actual cost of the engagement.

What should an India entry services RFP actually cover?

An India entry services RFP should cover four workstreams as one linked engagement, not four separate quotes: entity incorporation, accounting and tax compliance, ongoing secretarial and FEMA regulatory filings, and legal support for contracts and employment. Scoping them separately is the single biggest reason quotes end up incomparable, because the same obligation (for instance, transfer pricing documentation) gets priced under accounting by one firm and under legal by another.

Why do India incorporation quotes from different firms vary so widely?

Two firms quoting for the same wholly owned subsidiary setup can differ by 3x to 5x on the headline number, and the difference is almost never quality. It is scope. A firm quoting ₹35,000 to ₹60,000 for incorporation is usually quoting SPICe+ filing and nothing else: no FEMA advance reporting, no FC-GPR, no first-year secretarial calendar, no accounting setup. A firm quoting ₹1.5 lakh to ₹3 lakh for the same “incorporation” line has bundled in the first year of compliance, or has priced in the cross-border coordination that a purely domestic CA firm does not budget for.

This is the pattern seen across almost every India entry RFP process Treelife has reviewed: the RFP asks “what does incorporation cost” instead of “what is included in the fee you are quoting for incorporation,” and the second question is the one that actually matters. A CFO comparing three quotes on the first question alone is comparing three different products with the same label.

Where the price gap usually comes from

Cost driver	Low quote pattern	High quote pattern
Scope of “incorporation” fee	SPICe+ filing only, DSC and DIN as pass-through	SPICe+ plus advance reporting, FC-GPR, first board meeting minutes, statutory registers
Recurring compliance	Quoted separately, often not shown until after the engagement starts	Bundled as a retainer visible from the first quote
FEMA and RBI filings	Excluded or quoted as “on request”	Included with a stated per-filing or annual fee
Cross-border coordination (time zone, parent-entity documentation, apostille chasing)	Not priced, causes delay later	Priced as a project management line
Legal support (SHA-adjacent, employment contracts, vendor agreements)	Excluded entirely, assumed the client has their own counsel	Included at a defined number of hours or documents

What structural information should the RFP ask for before pricing is even discussed?

Before asking any firm to quote a number, the RFP should force clarity on the entity structure, the parent company’s home jurisdiction, and the expected transaction volume, because pricing without this context is not a real quote. Ask every firm to confirm, in writing, the entity type they are pricing for (wholly owned subsidiary, branch office, or liaison office), since the compliance load and hence the fee structure differs materially between the three (Foreign Exchange Management (Establishment in India of a Branch Office or a Liaison Office or a Project Office or any Other Place of Business) Regulations, 2016).

Structure the RFP so this information goes in a cover brief that every firm receives identically, before the question-and-quote sections. At minimum, the brief should state:

• The parent company’s jurisdiction, sector, and whether the sector triggers any FDI approval route restriction under the DPIIT Consolidated FDI Policy
• Expected headcount in India for year one and year two, since this determines when EPF, ESI, and POSH obligations trigger
• Whether the Indian entity will invoice customers directly, invoice only the parent, or both, since this changes GST and transfer pricing scope
• Expected capital remittance amount and timing, since FEMA advance reporting and FC-GPR timelines depend on this
• Whether the parent already has a group tax structure that requires Form 3CEB, Master File, or Country-by-Country Report coordination

What should you ask about incorporation and company registration?

The incorporation section of the RFP should ask each firm to itemise every step from name reservation through the first board meeting, and state which steps are included in the quoted fee versus billed as a pass-through cost. A firm that cannot break down SPICe+ filing, DSC and DIN procurement, PAN and TAN issuance, bank account opening support, and the first board meeting into separate line items has not actually costed the engagement, it has estimated it.

Specific questions to include:

• What is the expected timeline from document submission to Certificate of Incorporation, and what part of that timeline is outside the firm’s control (apostille processing in the parent’s home country, for instance)?
• Who holds the resident director requirement, and does the firm provide a nominee resident director service, and at what fee and liability terms?
• Is the advance reporting to RBI on the FIRMS portal included in the incorporation fee, or is it billed as a separate FEMA filing? This single question exposes the firms that price incorporation without pricing the FEMA obligation that follows it within 30 days of capital receipt.
• Does the firm’s incorporation fee include drafting the Memorandum and Articles of Association tailored to the parent’s governance requirements, or a template MoA/AoA that will need redrafting later?

How much does India company incorporation typically cost for a foreign-owned subsidiary?

Incorporation of a wholly owned subsidiary alone, covering SPICe+ filing, DSC, DIN, PAN and TAN, typically runs ₹40,000 to ₹1.5 lakh depending on firm and complexity, excluding government fees and stamp duty. This figure excludes FEMA advance reporting, FC-GPR, first-year secretarial compliance, and accounting setup, which is exactly why it should never be compared as a standalone number across firms (verify current figures with each firm, since these are indicative market ranges, not statutory fees).

What should you ask about accounting, bookkeeping and tax compliance?

This section should force each firm to state its accounting software, its close cycle, and how it handles the two obligations that new subsidiaries most often discover too late: transfer pricing documentation and DTAA-linked withholding on payments to the parent.

Ask each firm:

• Which accounting software will be used, and does the firm provide monthly management accounts, or only statutory year-end books?
• What is the firm’s approach to arm’s length pricing for intercompany transactions such as management fees or seconded staff recharges, and will the firm prepare the transfer pricing Local File and Form 3CEB, or refer this out?
• Before the first payment to the parent company, will the firm collect the Tax Residency Certificate, Form 10F, and beneficial ownership declaration needed to apply the treaty withholding rate instead of the domestic rate under the Income Tax Act, 2025?
• Does the quoted fee include the statutory audit, the tax audit if turnover crosses the threshold, and the annual income tax return, or are these quoted separately once the first year closes?

Direct answer: a fee that covers “accounting” but excludes transfer pricing documentation and Form 3CEB support will look cheaper in the RFP and cost more in year two, because the transfer pricing engagement gets negotiated separately once the firm already holds the relationship and the client has limited leverage to switch.

What should you ask about ongoing secretarial and FEMA or RBI compliance?

This is the workstream most often underpriced in initial quotes because its cost is backloaded. The RFP should ask each firm to produce a full first-year compliance calendar with named deadlines, not a general description of “ongoing compliance support.”

Ask for:

• A named list of every filing due in year one: Form BEN-2, first board meeting, statutory auditor appointment, FLA Return, DIR-3 KYC, AOC-4 and MGT-7 timelines from the eventual AGM date, and how each is priced (flat annual retainer versus per-filing fee)
• Confirmation of who is responsible if a filing deadline is missed because the client was slow to provide documents versus because the firm did not track the deadline, and what remedy applies in each case
• Whether the firm’s compliance retainer includes the FLA Return every year the entity carries an FDI position, since this filing is easy to forget after year one and the RFP should confirm the firm tracks it without being reminded
• Whether the quoted fee includes DPDPA gap assessment support, given that core Digital Personal Data Protection Act, 2023 obligations on consent, breach notification, and security safeguards come into force from 13 May 2027, and a subsidiary entering India now should be building compliant data architecture rather than retrofitting it later

What should you ask about legal support for contracts and employment?

Most India entry RFPs treat legal as an afterthought, a line that says “legal support as required.” That framing produces the least comparable quotes of the four workstreams, because “as required” carries no scope at all. Ask each firm to price a defined bundle: a template employment contract compliant with the state Shops and Establishments Act where the entity will operate, a vendor or MSA template, a POSH policy, and a stated number of ad hoc contract reviews included per quarter before hourly billing kicks in.

Ask specifically:

• Does the firm draft India-specific employment contracts, or adapt a template from the parent’s home jurisdiction, which frequently misses Indian termination notice and gratuity requirements?
• At what employee count does the firm proactively flag the POSH Internal Complaints Committee requirement, given the obligation triggers at the tenth employee and carries criminal liability for the employer under Section 26 of the POSH Act, 2013 if missed?
• If the parent needs a shareholders agreement, board charter, or IP assignment deed as part of the India entry, is this priced within the RFP response or treated as a separate engagement once incorporation is complete?

How should the RFP structure pricing so quotes are actually comparable?

Require every firm to respond using the same pricing grid, split by workstream and by year, rather than a single lump figure. A firm unwilling to unbundle its pricing into this format is signalling that its price depends on being compared loosely, not precisely.

Standard pricing grid to require from every respondent

Workstream	One-time fee (Year 1)	Recurring fee (Year 1)	Recurring fee (Year 2 onward)	Explicitly excluded
Incorporation and FEMA reporting	State amount	State amount if applicable	Not applicable	List exclusions
Accounting, bookkeeping, statutory audit	State amount	State amount	State amount	List exclusions
Secretarial and RBI compliance calendar	State amount	State amount	State amount	List exclusions
Legal (contracts, employment, policies)	State amount	State amount	State amount	List exclusions
Transfer pricing and Form 3CEB	State amount	State amount	State amount	List exclusions

Forcing this format catches the two most common quoting tactics: a low year-one number that masks a much higher year-two retainer once the client is locked in, and an “excluded” column left blank because the firm has not actually thought through what falls outside scope.

What questions reveal whether a firm can actually handle cross-border compliance?

Domestic Indian CA and CS firms are competent at Indian compliance but not all of them have run engagements where the client sits in a different time zone, needs board packs in a format the parent’s audit committee can use, and requires documentation that survives scrutiny during a future funding round or acquisition due diligence. The RFP should ask directly:

• How many active engagements does the firm currently run for foreign-owned subsidiaries, and can it name the jurisdictions (not the clients) it has worked with?
• Who is the single named point of contact for the engagement, and what is the firm’s stated response time for queries raised from a non-Indian time zone?
• Has the firm supported a client through an RBI compounding process or a FEMA contravention correction, and if so, in what capacity?
• Can the firm produce a sample of the board pack or management report format it provides to a foreign parent, rather than describing it in prose?
• Who is the named person executing the day-to-day work, separate from whoever is presenting in the pitch meeting, and what is that person’s seniority and tenure at the firm? A senior partner leading the pitch and a two-year-associate running the actual filings is common in Indian professional services and is not disqualifying on its own, but the RFP should surface it before signing, not after the first missed deadline.
• Does the firm currently serve any competitor of the parent company in India, and what is its policy on conflicts if one arises mid-engagement?

A firm that answers these questions with specifics is signalling operational maturity for cross-border work. A firm that answers only in general capability language is signalling that this would be a new type of engagement for them, which is not disqualifying, but should be priced and staffed accordingly, not assumed away.

How should you score vendor responses once the quotes are in?

Publish the scoring weights in the RFP itself, before firms respond, rather than deciding weights after the quotes arrive. This stops the evaluation from quietly collapsing into a price comparison, which is what happens by default when no weighting was agreed in advance.

Suggested scoring weight structure for an India entry RFP

Evaluation category	Suggested weight	What it checks
Total first-year cost across all workstreams	30%	The completed pricing grid, not the headline incorporation number
Scope completeness	25%	Whether FEMA reporting, transfer pricing, and the full compliance calendar are priced in, not excluded
Cross-border experience and named staff continuity	20%	Track record with foreign-owned clients and clarity on who executes the work
Response time and single point of contact commitment	15%	Stated SLA for queries raised outside Indian business hours
References from comparable clients	10%	Verified via a call, not taken from the proposal document alone

Score each firm against this table with the same reviewer applying the same weights, and keep the scoring separate from the negotiation conversation that follows. A firm that scores well on scope and experience but high on price is a negotiation candidate. A firm that scores low on scope completeness is not, regardless of price.

Common mistakes that make the RFP process worse than no RFP at all

1. Scoping the four workstreams as four separate RFPs. This is the single most expensive mistake. It produces quotes that cannot be compared and, worse, creates four separate vendor relationships with four different views of the entity’s compliance calendar, none of whom is accountable for the whole picture. A missed FLA Return, for instance, falls between the accounting firm and the compliance firm if neither was engaged to own it end to end.

2. Asking for a single number instead of a workstream and year-split grid. A single quoted number invites the vendor to bundle in whatever makes the number look lowest, and back-load the rest. Firms that quote this way are not being dishonest, they are responding to the format of the question asked.

3. Not specifying the entity structure before requesting quotes. Asking for “a quote for setting up in India” without specifying wholly owned subsidiary, branch, or liaison office produces quotes based on the firm’s own assumption of what the client needs, which may not match the parent’s actual FDI route or sector cap position.

4. Treating legal as a line item instead of a scoped deliverable. “Legal support as required” is not a scope. It is an invitation for the vendor to bill by the hour on everything, which is fine if the buyer wants that, but should be a deliberate choice stated in the RFP, not a default that emerges from vague wording.

5. Skipping the reference check on cross-border experience. Every firm on the shortlist will claim India entry expertise. Few will have run engagements where the client sits eight time zones away and needs documentation packaged for a foreign audit committee. This gap surfaces in month three, not in the pitch meeting, unless the RFP asks for it directly.

Treelife’s practitioner note

In the India entry engagements we have run at Treelife, the RFPs that produce the best outcomes are the ones where the foreign company’s finance lead insists on the workstream and year-split pricing grid before any vendor meeting happens, and shares the same grid with every shortlisted firm. We have seen quotes for the same wholly owned subsidiary setup range from ₹1.2 lakh to over ₹6 lakh for year one, and in almost every case the gap traced back to whether FEMA advance reporting, FC-GPR, and the first-year secretarial calendar were priced in or quietly excluded. One pattern specific to live transactions: firms that quote low on incorporation and high on the “onboarding” or “compliance setup” fee in month two are usually recovering the same margin through a different line item, which is why the RFP should ask for a total first-year figure across all workstreams, not just the headline incorporation number, before any comparison is made.

Case study

Situation: A UK-based SaaS company with 40 employees globally decided to hire its first three engineers in India and needed a subsidiary set up within a quarter.

Challenge: The company had received three quotes ranging from ₹1.5 lakh to ₹4.5 lakh for “India incorporation and compliance” with no consistent scope across them, and the finance lead could not tell which quote actually covered FEMA reporting and the first-year secretarial calendar.

What Treelife did: Rebuilt the RFP into a workstream and year-split grid, sent it to all three shortlisted firms including a competing quote, and ran a structured comparison call focused on the exclusions column rather than the headline price.

Outcome: The revised comparison showed that the lowest quote excluded FEMA advance reporting and FC-GPR entirely, a gap that would have surfaced as a compliance breach within 60 days of the first capital remittance. The company selected a mid-range quote with full scope, closing incorporation in 11 working days from document submission.

FAQ’s on structuring an India entry services RFP

Q: What is the difference between an RFP and an RFQ for India entry services?
A: An RFP asks firms to propose an approach and scope alongside price, which suits India entry because the right entity structure and compliance scope are not yet fixed. An RFQ asks for a price against a specification you have already finalised, which only works once the entity type and workstream scope have already been decided.

Q: How many firms should be included in an India entry RFP?
A: Three to four firms is the practical range. Fewer than three gives no real price or scope comparison. More than four multiplies coordination effort without materially improving the decision, since the same structural questions and pricing grid apply regardless of shortlist size.

Q: Should the RFP be sent before or after choosing the entity structure (WOS, branch, liaison)?
A: After. Entity structure changes the compliance load and hence the price so significantly (a WOS carries SBO disclosure and full FEMA and tax obligations that a liaison office does not) that quotes collected before this decision are not comparable to each other or to the eventual real cost.

Q: What should be excluded from a fixed-fee incorporation quote by default?
A: Government filing fees, stamp duty (which varies by state), apostille and notarisation costs in the parent’s home country, and any legal opinion required on FDI sectoral cap applicability. These are typically pass-through costs even in a well-structured fixed fee.

Q: How much does ongoing compliance for a foreign-owned subsidiary typically cost per year?
A: Depending on transaction volume, headcount, and whether transfer pricing documentation is required, ongoing accounting, secretarial, and FEMA compliance for a small wholly owned subsidiary typically runs ₹3 lakh to ₹10 lakh annually. Always request this as a named line in the pricing grid rather than accepting a bundled annual figure.

Q: Can one firm handle incorporation, accounting, compliance and legal, or should these be split across specialists?
A: A single accountable firm reduces the risk of an obligation falling between two vendors, particularly for filings like the FLA Return that neither a pure accounting firm nor a pure legal firm may consider theirs to track. If splitting across specialists for genuine expertise reasons, the RFP should name which vendor owns the compliance calendar end to end.

Q: What happens if the selected vendor misses a compliance deadline after the RFP is signed?
A: This depends entirely on the engagement letter, not the RFP. The RFP should require each firm to state its liability position on missed statutory deadlines before selection, since most engagement letters limit liability to fees paid, which rarely covers the actual penalty exposure (for instance, a company that fails to file Form BEN-2 faces a penalty of ₹1 lakh plus ₹500 for each day of continuing default, capped at ₹5 lakh, under Section 90(11) of the Companies Act, 2013, as amended).

Q: Should the RFP ask for references from other foreign clients?
A: Yes, and specifically ask for a client in a comparable time zone or sector, not just any reference. A firm’s strongest reference may be a domestic Indian client, which does not tell you how the firm performs on cross-border coordination.

Q: How long should the full RFP-to-selection process take?
A: Two to three weeks is realistic if the cover brief and pricing grid are sent to all firms simultaneously. Processes that stretch beyond a month usually indicate the buyer is still deciding entity structure mid-process, which should be resolved before the RFP goes out, not during vendor evaluation.

Q: Does DPIIT startup recognition or any government scheme reduce India entry compliance costs for a foreign subsidiary? A: DPIIT startup recognition and its associated tax exemptions apply to Indian-incorporated entities meeting specific age and turnover criteria, and are generally not the relevant framework for a foreign parent’s Indian subsidiary, which is typically incorporated to serve the parent’s own commercial operations rather than to raise independent venture funding. Do not build RFP cost assumptions around startup scheme benefits without confirming eligibility first.

Q: What is the single question in an India entry RFP that most exposes a weak vendor?
A: Asking for the full year-one compliance calendar with named deadlines and named responsibility for each filing. A firm that has genuinely scoped the engagement will produce this without hesitation. A firm that has quoted from a template will visibly struggle to itemise it.

Regulatory references

• Companies Act, 2013, Sections 90, 96, 99, 139, 173
• Foreign Exchange Management Act, 1999, Section 13
• Foreign Exchange Management (Establishment in India of a Branch Office or a Liaison Office or a Project Office or any Other Place of Business) Regulations, 2016
• Income Tax Act, 2025, Chapter X (transfer pricing provisions)
• Digital Personal Data Protection Act, 2023, Section 33
• Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, Section 26
• DPIIT Consolidated FDI Policy Circular, F.No. 5(2)/2020, as amended

External sources

• Ministry of Corporate Affairs
• Reserve Bank of India
• Income Tax India
• Startup India