Overview of Company Registration in Nepal
The Office of Company Registrar (OCR) in Nepal has digitized the company incorporation process through its online portal, enabling entrepreneurs to register companies electronically. The Companies Act, 2063 (2006) governs company registration in Nepal, and the OCR portal implements these legal provisions through a streamlined digital platform. This online system reduces processing time and eliminates the need for physical visits to the Company Registrar’s Office.
Legal Framework for Company Incorporation
The Companies Act, 2063 (2006) and the Companies Regulations, 2064 (2008) provide the legal foundation for company registration in Nepal. Section 3 of the Companies Act mandates that no company shall operate without registration at the Office of Company Registrar. The Act recognizes several types of companies including private limited companies, public limited companies, and companies limited by guarantee. The online OCR portal facilitates registration under these legal provisions while maintaining compliance with statutory requirements.
Types of Companies That Can Be Registered Online
| Company Type | Minimum Shareholders | Minimum Directors | Share Capital Requirement |
|---|---|---|---|
| Private Limited Company | 1 | 1 | NPR 100,000 |
| Public Limited Company | 7 | 3 | NPR 1,000,000 |
| Company Limited by Guarantee | 2 | 3 | No share capital required |
The OCR portal supports online registration for all these company types. Private limited companies remain the most popular choice for small and medium enterprises due to lower capital requirements and simplified management structure.
Prerequisites for Online Company Registration
Before initiating the online registration process, applicants must fulfill certain prerequisites. Each proposed director and shareholder must obtain a Permanent Account Number (PAN) from the Inland Revenue Department. Foreign nationals intending to become directors or shareholders must secure approval from the Department of Industry under the Foreign Investment and Technology Transfer Act, 2075 (2019).
Required Digital Infrastructure
Applicants need the following digital tools to complete online registration:
- A valid email address for receiving communications and verification codes from the OCR portal.
- A functional mobile phone number registered in Nepal for SMS-based authentication.
- Digital copies of all required documents in PDF format with file sizes not exceeding 2 MB per document.
- A reliable internet connection to complete the multi-step registration process without interruption.
- A digital signature or scanned signature image for signing the electronic application forms.
Documents Required for Online Company Incorporation
For Nepalese Promoters
- Citizenship certificate copies of all proposed directors and shareholders with clear, legible scans.
- PAN registration certificates issued by the Inland Revenue Department for each promoter.
- Recent passport-size photographs of all directors and shareholders in JPEG format.
- Specimen signatures of all promoters on white paper, scanned in high resolution.
- Proof of registered office address including ownership documents or a notarized rental agreement.
For Foreign Promoters
- Valid passport copies with at least six months validity remaining from the date of application.
- Foreign Investment approval letter from the Department of Industry as per Section 3 of the Foreign Investment and Technology Transfer Act, 2075.
- PAN certificates obtained from the Inland Revenue Department through authorized representatives.
- Notarized and apostilled documents from the country of origin, translated into Nepali or English.
- Board resolution from the foreign company authorizing investment in Nepal, if the investor is a corporate entity.
Step-by-Step Process for Online Company Registration
Step 1: Access the OCR Portal
Visit the official OCR portal at ocr.gov.np and create a user account by providing basic information. The system generates a unique user ID and password for accessing the registration platform. Verify the email address and mobile number through the codes sent by the system.
Step 2: Name Reservation
Submit an application for company name reservation through the portal. The Companies Act, 2063 requires that company names must not be identical or similar to existing registered companies. Propose at least three alternative names in order of preference. The name must include “Private Limited” or “Public Limited” as applicable under Section 8 of the Companies Act.
Step 3: Pay Name Reservation Fee
The OCR portal generates a payment voucher for the name reservation fee. As per the Companies Regulations, 2064, the fee for name reservation is NPR 100. Payment can be made through the portal’s integrated payment gateway using internet banking, mobile banking, or e-wallet services.
Step 4: Receive Name Approval
The Office of Company Registrar reviews the proposed names within 1-3 working days. Upon approval, the system sends a notification with the reserved name and a unique reservation number. The name reservation remains valid for 35 days from the date of approval under Regulation 4 of the Companies Regulations.
Step 5: Complete Company Details Form
Fill in the comprehensive company information form on the OCR portal. This includes details about the registered office address, business objectives, authorized capital, issued capital, and share distribution among promoters. The business objectives must comply with Section 9 of the Companies Act and should clearly describe the intended business activities.
Step 6: Upload Required Documents
Upload all mandatory documents in the specified format through the document submission section. The portal validates file formats, sizes, and document types automatically. Ensure all documents are clearly legible and properly certified where required by law.
Step 7: Prepare and Upload Memorandum of Association
Draft the Memorandum of Association according to the format prescribed in Schedule 1 of the Companies Regulations, 2064. The Memorandum must contain the company name, registered office address, objectives, liability clause, and capital clause. All promoters must sign the Memorandum electronically or upload signed copies.
Step 8: Prepare and Upload Articles of Association
Prepare the Articles of Association following the model articles provided in Schedule 2 of the Companies Regulations or create customized articles. The Articles govern the internal management of the company and must comply with the Companies Act provisions. Upload the signed Articles of Association through the portal.
Step 9: Submit Registration Application
Complete the final registration application form incorporating all previously entered information. Review all details carefully before submission as amendments after submission require additional procedures. The system generates a unique application number upon successful submission.
Step 10: Pay Registration Fees
The OCR portal calculates registration fees based on the authorized capital as specified in Schedule 3 of the Companies Regulations, 2064. The fee structure is as follows:
| Authorized Capital Range | Registration Fee (NPR) |
|---|---|
| Up to NPR 100,000 | 1,000 |
| NPR 100,001 – 500,000 | 2,000 |
| NPR 500,001 – 1,000,000 | 3,000 |
| NPR 1,000,001 – 10,000,000 | 5,000 |
| Above NPR 10,000,000 | 10,000 |
Step 11: Document Verification
The Office of Company Registrar reviews the submitted application and documents. Officials verify compliance with the Companies Act, 2063 and related regulations. The verification process typically takes 3-7 working days depending on the completeness and accuracy of submitted information.
Step 12: Receive Certificate of Incorporation
Upon successful verification, the OCR issues a Certificate of Incorporation electronically. The certificate contains the company registration number, date of incorporation, and digital signature of the Registrar. Section 11 of the Companies Act states that a company comes into existence from the date mentioned in the Certificate of Incorporation.
Post-Incorporation Compliance Requirements
PAN Registration for the Company
Within 30 days of incorporation, the company must register for a PAN at the Inland Revenue Department. The company PAN is mandatory for opening bank accounts, conducting business transactions, and fulfilling tax obligations under the Income Tax Act, 2058 (2002).
VAT Registration
Companies engaged in taxable supplies exceeding NPR 5,000,000 annually must register for Value Added Tax under the Value Added Tax Act, 2052 (1996). Registration can be completed online through the Inland Revenue Department’s portal within 30 days of crossing the threshold.
Social Security Fund Registration
The Social Security Act, 2074 (2018) requires companies to register with the Social Security Fund within 30 days of hiring employees. This registration enables employees to access social security benefits including medical insurance, accident insurance, and dependent family benefits.
Municipal Business License
Obtain a business operation license from the local municipal office where the company’s registered office is located. The Local Government Operation Act, 2074 (2017) empowers municipalities to regulate business operations within their jurisdiction.
Advantages of Online Company Registration
The OCR portal offers significant benefits compared to traditional paper-based registration. The online system reduces processing time from several weeks to approximately one week. Applicants can track application status in real-time through the portal dashboard. The digital platform minimizes errors through automated validation of forms and documents. Cost savings result from eliminated travel expenses and reduced need for intermediaries.
Common Challenges and Solutions
Technical Issues with Portal Access
Users occasionally face login difficulties or system errors on the OCR portal. Clear browser cache and cookies before accessing the portal. Use updated versions of web browsers such as Google Chrome or Mozilla Firefox. Contact the OCR helpdesk at the phone numbers provided on the website for technical support.
Document Format Rejections
The portal rejects documents that do not meet specified format requirements. Ensure all documents are in PDF format with individual file sizes under 2 MB. Scan documents at 300 DPI resolution for optimal clarity. Convert images to PDF using reliable conversion tools before uploading.
Name Rejection Issues
Proposed company names may be rejected for similarity with existing companies or violation of naming guidelines. Research existing company names through the OCR portal’s search function before submission. Avoid names that include restricted words or suggest government affiliation without authorization. Prepare multiple alternative names to expedite the approval process.
Foreign Investment Considerations
Foreign investors must obtain prior approval from the Department of Industry before incorporating a company in Nepal. The Foreign Investment and Technology Transfer Act, 2075 (2019) regulates foreign investment and specifies sectors open to foreign participation. Section 3 of the Act requires foreign investors to obtain approval by submitting an application with details of proposed investment, business plan, and source of funds.
Restricted Sectors for Foreign Investment
| Sector | Foreign Investment Limit |
|---|---|
| Cottage Industries | 0% (Prohibited) |
| Personal Service Business | 0% (Prohibited) |
| Arms and Ammunition | 0% (Prohibited) |
| Domestic Courier Services | 0% (Prohibited) |
| Retail Business (less than NPR 50 million) | 0% (Prohibited) |
Share Capital Requirements and Payment
The Companies Act, 2063 requires private limited companies to have minimum authorized capital of NPR 100,000 and public limited companies to have NPR 1,000,000. At least 25% of the issued capital must be paid up at the time of incorporation as per Section 5 of the Act. Promoters must deposit the paid-up capital in a bank account opened in the company’s name before receiving the Certificate of Incorporation.
Director and Shareholder Requirements
Minimum Number Requirements
Section 42 of the Companies Act, 2063 mandates that private limited companies must have at least one director while public limited companies require minimum three directors. At least one director must be a resident of Nepal who has stayed in Nepal for at least 182 days in the preceding year.
Director Qualifications and Disqualifications
Section 44 of the Companies Act specifies disqualifications for directors. Individuals declared insolvent, convicted of moral turpitude offenses, or disqualified by court orders cannot serve as directors. Directors must be at least 18 years old and possess legal capacity to enter into contracts.
Registered Office Requirements
Every company must maintain a registered office in Nepal from the date of incorporation under Section 23 of the Companies Act, 2063. The registered office address must be a physical location where official communications can be received during business hours. Companies must notify the Office of Company Registrar within 15 days of any change in registered office address.
Annual Compliance Obligations
Annual General Meeting
Section 72 of the Companies Act, 2063 requires companies to hold an Annual General Meeting within six months of the end of each fiscal year. The meeting must approve annual financial statements, appoint auditors, and address other matters specified in the Act.
Annual Return Filing
Companies must file annual returns with the Office of Company Registrar within one month of the Annual General Meeting. The annual return contains information about directors, shareholders, share capital, and registered office as prescribed in Section 80 of the Companies Act.
Financial Statement Submission
Audited financial statements must be submitted to the Office of Company Registrar along with the annual return. The financial statements must comply with Nepal Financial Reporting Standards and be audited by a chartered accountant registered with the Institute of Chartered Accountants of Nepal.
Fees Structure for Company Registration
| Service Type | Fee Amount (NPR) |
|---|---|
| Name Reservation | 100 |
| Registration Fee (up to NPR 100,000) | 1,000 |
| Registration Fee (NPR 100,001–500,000) | 2,000 |
| Registration Fee (NPR 500,001–1,000,000) | 3,000 |
| Certified Copy of Certificate | 500 |
| Certified Copy of Memorandum/Articles | 500 per document |
Timeline for Company Incorporation
The complete online company incorporation process typically requires 7-15 working days from name reservation to receiving the Certificate of Incorporation. Name reservation takes 1-3 working days. Document verification and approval require 3-7 working days. Additional time may be needed if the Office of Company Registrar requests clarifications or additional documents.
Can a single person incorporate a company in Nepal?
Yes, a single person can incorporate a private limited company in Nepal. The Companies Act, 2063 allows one-person companies where the same individual serves as the sole director and shareholder, subject to minimum capital requirements.
Is physical presence required for online company registration?
No, physical presence is not required for the online registration process. All procedures can be completed remotely through the OCR portal. However, documents must be properly notarized and authenticated as per legal requirements.
How long is the company name reservation valid?
The reserved company name remains valid for 35 days from the date of approval. If the company is not incorporated within this period, the name reservation lapses and must be renewed by paying the reservation fee again.
Can foreign nationals be directors of Nepali companies?
Yes, foreign nationals can be directors of companies in Nepal. However, at least one director must be a resident of Nepal who has stayed in Nepal for at least 182 days in the preceding year.
What happens if annual compliance is not met?
Failure to meet annual compliance requirements results in penalties under Section 167 of the Companies Act, 2063. The Office of Company Registrar may impose fines and, in severe cases, initiate proceedings for company dissolution.
Can the company start business immediately after incorporation?
The company can commence business after incorporation, obtaining necessary licenses, and fulfilling sector-specific regulatory requirements. Banking, insurance, and other regulated sectors require additional approvals from respective regulatory authorities before commencing operations.
Is it mandatory to have a company seal?
No, company seals are not mandatory under the Companies Act, 2063. Companies can execute documents through authorized signatories without requiring a physical seal, though many companies maintain seals for traditional purposes.
Can the Memorandum and Articles be amended after incorporation?
Yes, the Memorandum and Articles of Association can be amended through special resolution passed by shareholders. The amendments must be filed with the Office of Company Registrar within 30 days as per Section 19 of the Companies Act.
What is the minimum paid-up capital requirement?
Private limited companies must have at least NPR 25,000 as paid-up capital (25% of minimum authorized capital of NPR 100,000). Public limited companies require minimum paid-up capital of NPR 250,000 at the time of incorporation.
Are there any restrictions on company names?
Yes, company names cannot be identical or similar to existing companies. Names suggesting government affiliation, containing offensive words, or violating public policy are prohibited. The name must include “Private Limited” or “Public Limited” as applicable.
