STP Unit can be set up by the following

• The Central Government undertaking
• The State Government undertaking
• The Public Sector Undertakings
• Co-operating undertaking
• Joint Sector undertaking
• The Private Sector Undertakings
• Individual Promoter/Partnership or any combination there of
• A Sole Proprietary Concern.
• An Indian Company.
• An Indian Subsidiary of a Foreign Company.
• A Branch office of the foreign company.
• An existing Software Company operating in India.
• Conversion of an existing DTA unit to STP unit is also permissible.
• If an industrial unit is operating both as a domestic unit as well as an STP unit, it shall have two distinct identities with separate accounts. But all the transactions of the imports and exports or supplies effected relating to the 100% EOU activity of the STP unit shall be kept distinctly separate from those made by the other domestic unit of the company.

Time frame & the procedure involved in Setting up of a 100% Export Oriented Unit (EO) under the Software Technology Parks of India (STPI)scheme of the Government of India.

Step1
An application in the prescribed format needs to be filed with the concerned STPI authorities. Along with the application the following documents are to be filed:

• Resume of the proposed CEO / COO / In-charge of the Unit for which registration is sought (as per the enclosed outline)
  A brief note on the proposed activities of the Indian entity along with that of the holding Company (as per the enclosed outline)

• In case it is a 100% subsidiary, a Memorandum of Understanding between the Indian entity and the holding Company for the services to be provided (as per the enclosed outline).

• Memorandum & Articles of Association of the Indian entity Extract of the Board Resolution authorizing the individual to sign the documents on behalf of the Company.

• Financials for a 5 year period of the Indian entity (as per format enclosed) The entity should furnish in the application the likely location from where the export operations are going to be carried out FIRC copies and letter filed with RBI for receipt of Foreign exchange towards allotment of equity from the Indian company.

• A processing fee of INR 2500 is to be remitted by the way of a Demand Draft along with the application.
  Other documents as required on case to case basis.

• After verification of the documents within a fortnight, the STPI authorities may call for a detailed presentation (preferably in Power Point) to explain in person to them and also discuss the product profile / services, the Indian entity is likely to deal in.

• A formal letter of approval would be communicated to the Company to set up a 100% Export Oriented Unit (EOU) under the Software Technology Parks of India scheme of the Govt. of India.

Step 2

• The Company needs to register as a EOU. The following documentation are involved:

• An agreement (as per format enclosed) needs to be executed by the Company indicating that the Company would comply with certain export norms as laid out in the Export Import Policy of the Govt. of India.

• A Registration Cum Membership certificate to be signed by the authorized person A letter to STPI that they are agreeable to the conditions laid out in the letter of permission. A Certificate issued by the bankers to the Company about the Current account maintained with them.

• A copy of the Corporate Tax ID (Permanent Account Number-PAN) Copy of the Importer-Exporter Code (IEC) issued by the office of The Joint Director General - Foreign Trade List of Capital goods proposed to be procured from abroad and within India Annual service fees of INR 50,000 payable in advance by the way of a Demand Draft.

Step 3

The next step involves obtaining the necessary approvals from the Customs authorities for setting up a Private Bonded Warehouse and also a In-Bond Manufacturing order to store the Capital goods obtained free of Customs / Excise duty and to carry on the manufacture of Computer Software.

The documentation and the procedure are detailed as under:

• Application for Customs License in prescribed format

• Copy of initial application to STPI including the project report

• Memorandum and articles of the company

• Letter of permission from STPI approving the unit as STP unit

• True copy of legal agreement for export obligation executed with STPI

• Lease agreement entered with the owner of the building

• Ground plan of the premises proposed to be bonded

• Letter of Undertaking for cost recovery charges

• Letter from the Bankers regarding satisfactory transactions

• Tentative list of imports and indigenous Capital Goods along with estimated cost duly certified by Director, STPI
  Registration-cum-Membership certificate issued by STPI.

• Certificate of Importer-Exporter code (IEC)

• Permanent Account Number (PAN)

• Three photographs of the head of the unit.

• The Customs authorities may inspect the premises and arrange to issue the license for Private Bonded Warehouse and In-Bond Manufacturing order

Compliance :

• 'To file monthly returns before 7th of the following month to STPI

• To file quarterly returns before 10th of the month after the close of the quarter to STPI

• Annual Returns to STPI in the nature of a Performance report indicating the Export Performance and CIF value of Imported Goods and Foreign Currency spent on other expenses like travel etc., - to be filed before 30th April.

• To fulfill an export obligation as per EXIM policy in force.

Note :

• The time frame indicated can be reduced depending on the flow of documents.

• The fees indicated are as on date of publishing this information. The units needs to pay the actual amount as applicable at the time of registration with the Concerned department.

• The documents mentioned above may vary and units needs provide the documents as requested by the concerned authorities.

• This information is meant for the units who intend to register with STPI, this should be not be used for any publication or circulation.