This article’s goal is to provide comprehensive, step-by-step information on the company registration process in Nepal. It can be a little scary for business owners to register a company in Nepal, especially if they are foreigners.
It covers the pre- and post-registration procedures, the kinds of companies that can be registered, the documentation needs, fees and charges, and typical difficulties that may arise.
The Companies Act of 2006 (2063) (the “Companies Act”) governs the incorporation of companies in Nepal. The competent authority to oversee business registration is the Office of Company Registrar (“OCR“).
Types of Companies in Nepal
Nepal provides options for different types of companies to suit business owners’ specific needs. The most common ones are:
Limited Liability Company (LLC)
This type of company includes a medium to large-scale company owned by shareholders, providing them with limited liability protection. Its minimum paid-up capital requirement is one lakh. This company has a minimum of one shareholder and a maximum of 101 shareholders. LLC is two types:
- One is single ownership and (एकल कम्पनी)
- Another one is multiple ownership.( बहुल कम्पनी)
Public Limited Company (PLC)
This type of company allows shares to be traded publicly, and its minimum paid-up capital requirement is one crore which is significantly higher than others. This company can have at least 7 shareholders and more than any number of shareholders depending on the size of the company.
Non-Governmental Organizations (NGOs)
NGOs are registered under the law of Nepal, providing registration and operating permits to minimize illegal operations and increase social activities. This company can have at least 5 shareholders and more than any number of shareholders depending on the size of the company Out of which 1 must be female. This type of company has no capital.
Sole Proprietorship
A sole proprietorship is a form of business where one individual has sole ownership and management responsibilities—this type of business is either registered in Gharelu Bibhag or Banijya Bibhag in Nepal.
Pre-registration Process of Company Registration in Nepal
Before registering your company, you must undergo a few preliminary stages:
Choosing a Company Name
The name chosen for a company in Nepal should be unique, not used, or similar to any other existing registered company’s name.
Company Registration Process in Nepal
The process of registering a company in Nepal involves four steps:
Step 1: Once the company name is approved Submit the Memorandum of Association (MOA), Articles of Association (AOA), Application and company’s owner(s) Citizenship to the Company Registrar’s Office
The MOA and AOA set out the company’s objectives, rules, regulations, and operations. Submit the application for company registration with the MOA, AOA, citizenship of shareholders, and necessary documents required by the government.
Step 2: Examination of submitted documents by officers of OCR
All submitted documents are checked by the officer. Once checked all the documents company owner needs to pay fees.
Step 3: Payment of Fees
Payment of registration fees is necessary as determined by the type of company and capital of the company you are registering.
Registration Fees for Different Types of Companies
(For Private Companies)
(For Public Company)
(For NGO)
- For all types of companies, government registration fees are exempt(free).
Step 4: Obtain the Certificate of Incorporation (COI)
Once the registrar approves the application submitted and the registration fee paid, you will receive the certificate of incorporation necessary for the legal operation of your company.
Document Requirements for Company Registration
For registering a company in Nepal, the following primary documentation is required:
- National identity card or passport of the company’s owner(s)
- Citizenship certificate of the company’s owner(s)
- Passport-sized photos of the company’s owner(s)
- Proof of address of the company’s office location
- The objective of the company
- Capital detail of the company(authorized, issue & paid-up)
Document required for registration of the company in Nepal
| S.N. | Documents | Number of Copies |
| 1. | Application for registration | 1 |
| 2. | MOA (Memorandum of Association) (प्रवन्धपत्र) | 2 |
| 3. | AOA (Article of Association) (नियमावली) | 2 |
| 4. | POA (Power of Attorney) (अख्तियारनामा) | 1 |
| 5. | Company’s owner(s) citizenship(Notarized) | 1 |
| 6. | POA Citizenship | 1 |
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Post-registration Process of Company Registration in Nepal
After acquiring the Certificate of Incorporation, you need to undergo a few additional procedures:
Acquiring a Permanent Account Number (PAN) Card
Once you have obtained the PAN Number, the next step is to acquire the PAN card / VAT card as it is required for different business and legal purposes.
Registering for VAT and PAN
Acquiring a VAT and PAN number is necessary for businesses that plan to pay taxes and claim refunds.
VAT/PAN Registration Process
Go to the IRD site and fill out the online form first for PAN/VAT registration and then keep all these following documents photocopied in one file.
| S.N. | Documents |
| 1. | Online VAT/PAN registration form |
| 2. | Rent agreement between company and house/land owner |
| 3. | Company’s owner(s) citizenship |
| 4. | House/land owner’s citizenship |
| 5. | Electricity bill/Water bill/ lalpurja of house owner |
| 6. | Personal Pan Number Of one shareholder in case of multiple owners |
| 7. | MOA & AOA Photocopy |
| 8. | Company Certificate |
| 9. | Personal Pan Number Of one shareholder in case of multiple owner |
| 10. | Company’s Office Location Map |
| 11. | Company’s Stamp |
Opening a Bank Account
You need a bank account to conduct business transactions like daily expenses, salaries and wages, and payments to vendors.
Document required for the open bank account of the Company
| S.N. | Documents | Number of Copies |
| 1. | Application form | 1 |
| 2. | MOA | 1 |
| 3. | AOA | 1 |
| 4. | Minute | 1 |
| 5. | Company’s owner(s) citizenship( | 1 |
| 6. | Stamp | 1 |
| 7. | Electricity bill of office location | 1 |
Minimum Amount Of Investment (Capital) Required for Registration of Company
| S.N. | Company | Amount(in NPR) |
| 1 | Public Company | 1,00,00,000 |
| 2 | Private Company | 1,00,000 |
| 3 | NGO | No capital required |
Benefits of Company Registration in Nepal
Registering a company in Nepal offers the following benefits:
a) Legal Protection and Limited Liability
An essential benefit of registering a company in Nepal is that it provides legal protection and limited liability to shareholders and directors.
b) Access to Government Contracts and Subsidies
Registered companies in Nepal can avail themselves of government contracts, tenders, grants, and subsidies.
c) Ability to Open a Bank Account and Secure Loans
Registered companies in Nepal can easily open bank accounts and can apply for loans from financial institutions.
Common Challenges During Company Registration
The following are some of the common hurdles businesses may face during company registration:
I) Difficulty in Acquiring Necessary Documents
As documentation is a vital requirement, it may be challenging for companies to gather all the necessary documents.
ii) Lengthy Registration Process
The company registration process can be slow due to a lack of technological integration between different government offices, making it difficult to coordinate the process.
iii) Bureaucratic Hurdles
Bureaucratic hurdles can cause undue delays, making the process more challenging and time-consuming.
Conclusion
In Nepal, it is necessary to register a company to formalize and legalize your business. This guide outlines the steps to register your company in Nepal. Additionally, it provides information on the type of companies you can register, document requirements, fees and charges, post-registration processes, benefits, and challenges one may face.
FAQs
How long does it take to register a company in Nepal?
The registration process generally takes around one week; however, it can take longer if any complications arise.
Can foreign nationals register a company in Nepal?
Yes, foreign nationals can register a company in Nepal. However, some restrictions might apply to foreign investments.
What is the minimum requirement for starting a business in Nepal?
The minimum requirement for starting a business in Nepal is to acquire a valid PAN number from the government.
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