Starting a Business in Nepal: Company Registration Process

Are you a Nepali entrepreneur planning to start a new business in Nepal? Do you want to know the Company Registration Process in Nepal? The legal process, process involving registration and post-registration procedures might be confusing for new entrepreneurs.

This article provides comprehensive information on company registration in Nepal. The process is overseen by the Office of the Company Registrar (OCR) in accordance with the Companies Act of 2063 BS (2006 AD).

Steps to follow for company registration in Nepal:

Before submitting an application, it is important to ensure that the proposed name of the company has been reserved with the OCR. The following steps should be followed for company registration in Nepal:

1. Submit an application to the OCR, adhering to the prescribed format, fees, and required documents.
2. If the application is made for the incorporation of a company under Section 4 of the Companies Act of 2063, the OCR will conduct necessary inquiries, register the company within 15 days of the application, and issue a company registration certificate in the prescribed format.
3. Register for tax purposes (VAT/PAN) at the Inland Revenue Office.

Documents Required for Company Registration in Nepal:

1. Two copies of the memorandum of association of the proposed company.
2. Two copies of the articles of association of the proposed company.
3. A copy of the consensus agreement, if applicable.
4. For public companies, a copy of any agreements entered into between the promoters prior to incorporation.
5. Approval or license as per the relevant laws for specific types of business or transactions.
6. A certified copy of the citizenship certificate, and if a corporate body is a promoter, a certificate of incorporation and the decision of the Board of Directors.
7. Attested copies of the citizenship certificates of the founder shareholders in the case of a public company.
8. Other required documents as per the OCR’s guidelines.

Company Registration Cost in Nepal:

The fees for company registration in Nepal depend on the registered capital. If the fee is up to NPR 5,000, it can be paid at the OCR. For fees exceeding NPR 5,000, the payment should be made to the ‘RAJASWA’ account number 1-1-05-10 at the Nepal Rastra Bank or other authorized commercial banks. Two copies of the voucher should be submitted to the OCR’s account section.

Fees for a Private Company:

• Up to NPR 100,000: NPR 1,000
• NPR 100,001 to 500,000: NPR 4,500
• NPR 500,001 to 2,500,000: NPR 9,500
• NPR 2,500,001 to 10,000,000: NPR 16,000
• NPR 1,00,00,001 to 2,00,00,000: NPR 19,000
• NPR 2,00,00,001 to 3,00,00,000: NPR 22,000
• NPR 3,00,00,001 to 4,00,00,000: NPR 25,000
• NPR 4,00,00,001 to 5,00,00,000: NPR 28,000
• NPR 5,00,00,001 to 6,00,00,000: NPR 31,000
• NPR 6,00,00,001 to 7,00,00,000: NPR 34,000
• NPR 7,00,00,001 to 8,00,00,000: NPR 37,000
• NPR 8,00,00,001 to 9,00,00,000: NPR 40,000
• NPR 9,00,00,001 to 10,00,00,000: NPR 43,000
• NPR 10,00,00,000 and up: NPR 43,000 + NPR 30 for each NPR 1,00,000

Fees for a Public Company:

• Up to NPR 100,000,000: NPR 15,000
• NPR 100,000,001 to 1,000,000,000: NPR 40,000
• NPR 1,000,000,001 to 2,000,000,000: NPR 70,000
• NPR 2,000,000,001 to 3,000,000,000: NPR 100,000
• NPR 30,00,00,001 to NPR 40,00,00,000: NPR 1,30,000
• NPR 40,00,00,001 to NPR 50,00,00,000: NPR 1,60,000
• Above NPR 50,00,00,000: NPR 3000 for each NPR 1,00,000

Company Registration in Nepal by Foreigners:

Foreigners seeking to register a company in Nepal must follow the following process at the OCR:

1. Obtain permission to conduct business or make investments in Nepal, as required by the Company Act of 2063.
2. Submit an application with the prescribed format and required documents.
3. The OCR will conduct necessary inquiries, register the company within 15 days, and issue the company registration certificate.

Documents Required for Company Registration in Nepal by Foreigners:

1. Proof of the foreigner’s citizenship.
2. A copy of the permit received from the authorized body to invest or conduct business in Nepal.
3. Two copies of the memorandum of association of the proposed company.
4. Two copies of the articles of association of the proposed company.
5. A copy of the consensus agreement, if applicable.
6. For public companies, a copy of any agreements entered into between the promoters prior to incorporation.
7. Approval or license as per the relevant laws for specific types of business or transactions.
8. A certified copy of the citizenship certificate, and if a corporate body is a promoter, a certificate of incorporation and the decision of the Board of Directors.
9. Attested copies of the citizenship certificates of the founder shareholders in the case of a public company.
10. Additional documents as specified by the Department of Industries for industrial companies with joint investment.
11. For individual foreigners, an attested copy of their passport; for foreign companies, an attested copy of the company registration certificate, a copy of the investment details decided by the founder, and an attested copy of the passport of the person representing the founder company.

Company Registration Time in Nepal:

1. Verify the uniqueness of the proposed company name:

• Agency: Office of the Company Registrar (Do online at OCR)
• Time: 1 day
• Cost: No charge

2. Buy a stamp to attach to the registration form:

• Agency: Post Office
• Time: 1 day
• Cost: NPR 5 (can be omitted if step 1 is done online)

3. Register at the office of the company registrar:

• Agency: Office of the Company Registrar
• Time: 7 days (for completion)
• Cost: Please refer to the above section “Company Registration Cost in Nepal”

4. Make a rubber stamp:

• Agency: Sealmaker
• Time: 1 day
• Cost: NPR 275

5. Register for VAT and Income Tax at Inland Revenue Office:

• Agency: Inland Revenue Office
• Time: 1 day
• Cost: No charge

6. Enroll the employees in the Provident Fund:

• Agency: Provident Fund
• Time: 1 day
• Cost: No charge

Important points to consider regarding company registration in Nepal:

1. For a private limited company, there should be a minimum of one shareholder and a maximum of fifty shareholders. When establishing a public limited company, there is a requirement of seven founders. However, establishing another public limited company being a founder of one public limited company, there is no requirement of seven founders.
2. The Memorandum and Articles of Association can be typed on one side of Nepali paper or plain paper.
3. The Memorandum and Articles of Association should be prepared in clear and precise Nepali language.
4. In the case of a company with foreign investment, the Memorandum and Articles of Association should be prepared in clear and precise English language, with a translation into Nepali also required.
5. Each page of the Memorandum and Articles of Association should be signed by all the founding shareholders.
6. In the final section of the Memorandum and Articles of Association, the complete name, address, share allocation, and signature of each founder should be clearly indicated, with original signatures.
7. At least one witness’s full name, address, and signature to the shareholder(s) are necessary.
8. If the company has a provision for the purchase of shares by an existing company, the financial status of the existing company should be presented as evidence during company registration.
9. During company registration, at least one shareholder must be personally present at the office to sign the documents.

Frequently Asked Questions:

1. Where is the Office of the Company Registrar (OCR) located?

The OCR is located in Tripureshor, Kathmandu.

2. How long does it take to register a company in Nepal?

It may take approximately 7 to 15 days to register a company in Nepal.

3. Can foreigners establish a company in Nepal?

Yes, foreigners can establish a company in Nepal by obtaining the necessary permissions according to the prevailing laws (Company Act, 2063 BS or 2006 AD).

4. Can a private company be converted into a public company?

Yes, a private company can be converted into a public company under specific circumstances as prescribed in the Company Act of 2063.

5. Can we register a company online?

Yes, it is possible to register a company online by visiting the website of the Office of the Company Registrar.

6. How many shareholders are required for a private limited company?

A minimum of one shareholder and a maximum of fifty shareholders are required for a private limited company.

7. Is there a minimum requirement for founders when establishing a public limited company?

Yes, there is a requirement of seven founders when establishing a public limited company. However, when establishing another public limited company being a founder of one public limited company, there is no requirement for seven founders.

8. What type of paper can be used for typing the Memorandum and Articles of Association?

The Memorandum and Articles of Association can be typed on one side of Nepali paper or plain paper.

9. In which language should the Memorandum and Articles of Association be prepared?

The Memorandum and Articles of Association should be prepared in clear and precise Nepali language.

10. What is the language requirement for companies with foreign investment?

For companies with foreign investment, the Memorandum and Articles of Association should be prepared in clear and precise English language, with a translation into Nepali also required.

11. How should the Memorandum and Articles of Association be signed?

Each page of the Memorandum and Articles of Association should be signed by all the founding shareholders.

12. What information should be included in the final section of the Memorandum and Articles of Association?

The final section should include the complete name, address, share allocation, and signature of each founder. All signatures should be original.

13. Is a witness required for the shareholder(s)?

Yes, at least one witness’s full name, address, and signature to the shareholder(s) are necessary.

14. What evidence is required for companies with provisions for share purchase by existing companies?

If the company has a provision for the purchase of shares by an existing company, the financial status of the existing company should be presented as evidence during company registration.

15. Is it necessary for a shareholder to be present during company registration?

Yes, at least one shareholder must be personally present at the office to sign the documents during company registration.

The important links and references are at the end of the infographic.

Important links and references:

Government of Nepal Ministry of Industry Office of the Company Registrar