/ Foreign Clients · Counterparty DD · Updated 2026-10-14
India counterparty DD, know who you're signing with.
Foreign company about to sign MSA / JV / supply / channel-partner / licensing / franchise agreement with an Indian counterparty — is the counterparty what they claim to be? Properly registered, financially sound, no sanctions, no FCPA / Bribery Act red flags, Press Note 3 clean, no undisclosed BO issues? BQP delivers counterparty DD in 5-10 business days. Here's what we check.
DC
Written by CA Durgesh Chavda
Chartered Accountant (ICAI) · Founder, Bharat Quantum Prospera · US incorporation, India-US DTAA, FEMA ODI, NRI taxation, cross-border structuring · LinkedIn
/ Statutory + corporate validation
The baseline.
- MCA registration: CIN + current status + registered office + directors + paid-up capital + authorised capital.
- MOA + AOA review: object clause + capacity to perform proposed contract.
- GST registration verification + current status + state-wise registrations (if multi-state operations).
- PAN verification against Income Tax database.
- IEC (Import Export Code) if cross-border trade involved.
- Udyam MSME + category.
- Specific sector licences: RBI (financial), SEBI (securities), FSSAI (food), CDSCO (pharma), Pollution Control Board (environmental), Factory licence (manufacturing), Shops & Establishment (service / retail), professional licences.
- Last 3 years AOC-4 + MGT-7 filing status.
- DIR-3 KYC status of all directors.
- Section 164 disqualified director check.
/ Financial health
The money view.
- Last 3 years' audited financials (MCA public filings): revenue trend, gross margin, EBITDA margin, net profit, net worth, debt/equity, interest coverage.
- Auditor's qualifications or notes (going concern, pending litigation disclosure, related-party transactions).
- DPT-3 return showing deposits + external borrowings.
- CIBIL commercial credit score (if accessible).
- Bank statement review for 3-6 months (if counterparty cooperates in DD).
- Working capital analysis: debtor days + creditor days + inventory days = cash conversion cycle.
- Pending Form 15CA / 15CB history indicating cross-border payments.
/ Litigation + compliance history
The risk view.
- Pending Income Tax notices + demands + appeals (via Form 26AS + ITR disclosures + Section 143(2) / 148 history).
- Pending GST notices + demands (via GST portal + ASMT-10 / DRC-01 history).
- Civil litigation: Supreme Court / High Court / District Court search by party name.
- NCLT proceedings: insolvency, oppression / mismanagement, Section 241-242 petitions.
- DRT (Debt Recovery Tribunal) proceedings.
- Criminal proceedings: FIRs, chargesheets, convictions (CrPC + specific legislation like PMLA / Prevention of Corruption Act).
- Consumer forum cases.
- Labour tribunal / IRPL cases.
- SEBI violations / fines (for listed / proximate-to-listed companies).
- FEMA breaches / RBI compounding history.
- Winding up / insolvency references.
/ FCPA + UK Bribery Act + anti-corruption DD
The compliance view.
For foreign principals subject to extraterritorial anti-bribery regimes (US FCPA, UK Bribery Act 2010, French Sapin II, Brazilian Clean Companies Act), Indian counterparty DD includes:
- Government relationship mapping: counterparty's revenue from government contracts, licensed sectors, politically exposed persons (PEPs) in management / ownership.
- Red-flag transaction screening: unusual payments to agents, intermediaries, consultants without clear business purpose; cash transactions in regulatory sectors; third-party intermediary payments.
- Beneficial Ownership mapping: PEPs in ownership chain + ultimate controller.
- Press / public record check: adverse media search; corruption allegations.
- FCPA / Bribery Act training evidence: counterparty's internal compliance programme.
- Specific Prevention of Corruption Act (India) history: pending cases under Section 7, 8, 9, 10, 11, 13 of PCA.
- Sanctions screening: OFAC SDN, UN consolidated list, EU, UK HM Treasury, Indian MHA + MEA lists.
- Press Note 3 beneficial ownership: any BO link to China, Pakistan, Bangladesh, Nepal, Bhutan, Myanmar, Afghanistan (for FDI into India from foreign principal).
/ Deliverable + decisions
What foreign client gets.
- Counterparty DD Report (10-20 pages): all five workstreams + overall risk rating (Low / Medium / High) + go/no-go recommendation.
- Pre-contract checklist: representations + warranties + indemnities to include; termination triggers; audit rights; compliance covenants.
- Post-signing monitoring plan: periodic verification of continuing compliance.
- Scope-based: Light (statutory + public records, 3-5 days), Full (+ financial + litigation + press, 5-10 days), Enhanced (+ FCPA / BO / sanctions / adverse media + interview, 10-15 days).
Last updated: 2026-10-14.
/ Ready when you are
About to sign with an Indian counterparty?
BQP counterparty DD: 5-15 day engagement. Statutory + financial + litigation + FCPA + beneficial ownership + sanctions. Risk rating + pre-contract checklist. Standard for mid-market foreign principals.
FAQ
Common questions, answered.
When should I run counterparty DD before signing with Indian company?
Before any material / recurring / long-term commitment: MSA with recurring revenue over USD 50K/year, JV / partnership agreement, supply contract above USD 100K/year, channel partner / distributor agreement, licensing / franchise agreement, equity investment, acquisition. Also mandatory under: UK Modern Slavery Act, German Supply Chain Act (LkSG), EU CSDDD for in-scope companies.
How long does Indian counterparty DD take?
5-10 business days typical. Light tier (statutory + public records only): 3-5 days. Full tier (+ financial + litigation history): 5-10 days. Enhanced tier (+ FCPA + beneficial ownership + sanctions + adverse media + optional interview): 10-15 days.
What's the difference between counterparty DD and supplier verification?
Supplier verification focuses on operational capability + delivery capacity + first-PO risk - includes site visit + factory audit + trade references (see our supplier verification guide). Counterparty DD focuses on contractual commitment risk + compliance + reputation - more legal/compliance oriented, less operational. Both can be combined for comprehensive due diligence.
What's checked in FCPA / Bribery Act DD specifically?
Government revenue exposure, PEP ownership, unusual third-party payments, red-flag transactions, adverse media / corruption allegations, prevention of corruption Act (India) history, beneficial ownership chain, sanctions screening (OFAC, UN, EU, UK, Indian MHA). Output formatted to satisfy US DOJ / SEC / UK SFO / French PNF due-diligence standards for extraterritorial anti-corruption enforcement.
Can I rely on BQP's DD report for my internal risk committee?
Yes - BQP DD reports are formatted for internal risk committee / board / investment committee use. Executive summary (1-2 pages) + risk rating + go/no-go recommendation + full workstream detail + supporting documents + pre-contract checklist. We've worked with internal risk committees of US / UK / Singapore / UAE multinationals on counterparty DD matters.
Does BQP handle counterparty DD for foreign clients?
Yes - standard service. Three tiers (Light / Full / Enhanced). Statutory + corporate + financial + litigation + FCPA + BO + sanctions. Standard 5-15 business day engagement. WhatsApp +91 78018 87130.
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