Register Business from Abroad in Nepal

Overview

Foreign nationals and non-resident Nepali citizens can establish and register businesses in Nepal through legally defined procedures. The registration process involves compliance with the Companies Act, 2063, the Foreign Investment and Technology Transfer Act, 2075, and relevant regulatory frameworks. Nepal’s business registration system accommodates various business structures, including private limited companies, partnerships, and sole proprietorships. The Department of Industry and the Office of the Company Registrar oversee business registration and licensing. Axion Partners stands as the No.1 Service Provider for business registration from abroad in Nepal, offering comprehensive guidance through all procedural requirements.

Legal Framework for Foreign Business Registration

Nepal’s legal framework governing foreign business registration comprises multiple statutes and regulations. The Companies Act, 2063, establishes the foundational requirements for company formation and registration. The Foreign Investment and Technology Transfer Act, 2075, provides specific provisions for foreign investors and their business operations. The Industrial Enterprises Act, 1992, regulates industrial business establishments. The Nepal Rastra Bank’s Foreign Exchange Management Regulations control currency-related transactions for foreign businesses. These laws collectively ensure that foreign businesses operate within Nepal’s regulatory environment while protecting national interests and maintaining transparency in business operations.

Types of Business Structures Available

Foreign investors can establish various business structures in Nepal, each with distinct legal characteristics and requirements.

Business Structure	Ownership	Liability	Registration Authority	Minimum Capital
Private Limited Company	Multiple shareholders	Limited	Office of Company Registrar	NPR 100,000
Public Limited Company	Multiple shareholders	Limited	Office of Company Registrar	NPR 1,000,000
Partnership Firm	Two or more partners	Unlimited	District Administration Office	As per agreement
Sole Proprietorship	Single owner	Unlimited	District Administration Office	No minimum
Branch Office	Parent company	Limited	Office of Company Registrar	As per parent company

Step-by-Step Registration Process

Step 1: Name Approval

The first step involves obtaining approval for the proposed business name from the Office of the Company Registrar. The applicant must submit the name approval form with three alternative business names. The name must comply with the Companies Act, 2063, and must not duplicate existing registered entities. Processing typically requires five to seven working days. The approved name remains valid for six months from the date of approval.

Step 2: Prepare Required Documents

Applicants must compile comprehensive documentation before formal registration submission. Essential documents include the memorandum of association, articles of association, identity documents of all shareholders, proof of address, and bank statements demonstrating financial capacity. For foreign investors, documents must include passport copies, visa status confirmation, and notarized certificates of incorporation from the home country. All foreign documents require apostille certification or embassy attestation as per the Hague Apostille Convention.

Step 3: Submit Registration Application

The completed application package must be submitted to the Office of the Company Registrar in Kathmandu or relevant district offices. The application includes the approved name certificate, memorandum and articles of association, director and shareholder information, and proof of registered office address. The applicant must pay the prescribed registration fee based on the company’s authorized capital. Processing typically requires ten to fifteen working days from the date of complete submission.

Step 4: Obtain Company Registration Certificate

Upon approval, the Office of the Company Registrar issues the Company Registration Certificate. This certificate serves as proof of legal incorporation and contains the company’s registration number, date of incorporation, and authorized capital details. The certificate must be obtained before commencing business operations. The registrar also issues a certified copy of the memorandum and articles of association.

Step 5: Obtain Tax Identification Number (PAN)

The newly registered company must obtain a Permanent Account Number (PAN) from the Inland Revenue Department. The PAN application requires the Company Registration Certificate, memorandum and articles of association, and proof of registered office address. The PAN serves as the company’s tax identification number for all tax-related transactions and filings.

Step 6: Register with Social Security Fund

Companies with employees must register with the Social Security Fund (SSF) within thirty days of commencing operations. The registration requires the Company Registration Certificate, PAN, and employee information. The SSF registration enables compliance with employee benefit obligations under the Social Security Act, 2074.

Documentation Requirements for Foreign Applicants

Foreign applicants must provide comprehensive documentation to establish business legitimacy and financial capacity.

The applicant must submit a valid passport with appropriate visa status for Nepal.
The applicant must provide a notarized certificate of incorporation from the home country.
The applicant must submit bank statements covering the previous six months demonstrating financial capacity.
The applicant must provide proof of residential address in the home country.
The applicant must submit a declaration of beneficial ownership disclosing all ultimate beneficial owners.
The applicant must provide a police clearance certificate or equivalent document from the home country.
The applicant must submit documents in English or provide certified translations into English.
The applicant must obtain apostille certification for all foreign documents as per the Hague Apostille Convention.
The applicant must provide a board resolution authorizing the establishment of the Nepal business entity.
The applicant must submit proof of registered office address in Nepal.

Capital Requirements and Investment Regulations

Nepal imposes specific capital requirements based on the business structure and industry sector. Private limited companies require a minimum authorized capital of NPR 100,000, while public limited companies require NPR 1,000,000. Foreign investors must deposit the required capital in a bank account opened in the company’s name before registration completion. The Foreign Investment and Technology Transfer Act, 2075, permits foreign investment in most sectors, with certain restrictions in defense, security, and cultural heritage sectors. Foreign investors must comply with Nepal Rastra Bank’s foreign exchange regulations regarding capital repatriation and dividend remittance.

Sector-Specific Regulations and Restrictions

Certain business sectors in Nepal require additional approvals and compliance measures beyond standard registration procedures.

Sector	Regulatory Authority	Special Requirements	Restrictions
Banking and Finance	Nepal Rastra Bank	License and capital requirements	Foreign ownership limited to 50%
Insurance	Insurance Board	License and solvency requirements	Foreign ownership limited to 50%
Telecommunications	Nepal Telecommunications Authority	License and frequency allocation	Foreign ownership limited to 20%
Media and Broadcasting	Nepal Broadcasting Council	License and content guidelines	Foreign ownership limited to 20%
Hydropower	Department of Energy	Environmental and social impact assessment	Foreign ownership permitted with conditions
Tourism	Ministry of Culture, Tourism and Civil Aviation	License and operational standards	Foreign ownership permitted
Manufacturing	Department of Industry	Industrial license and environmental clearance	Foreign ownership permitted
Real Estate	Land Revenue Office	Land ownership restrictions apply	Foreign nationals cannot own land

Foreign Exchange and Currency Regulations

The Nepal Rastra Bank regulates all foreign exchange transactions related to business operations. Foreign investors must comply with the Foreign Exchange Management Regulations, 2074, when remitting capital, profits, or dividends. The central bank requires documentation of the source of foreign currency and the purpose of remittance. Dividend remittance requires submission of audited financial statements and tax clearance certificates. The current regulations permit repatriation of profits and capital subject to tax compliance and regulatory approval. Foreign investors must maintain records of all foreign exchange transactions for regulatory scrutiny.

Tax Obligations and Compliance

Foreign-registered businesses in Nepal must comply with all applicable tax laws and filing requirements. The Income Tax Act, 2074, imposes corporate income tax at the standard rate of 25% on business profits. Value Added Tax (VAT) registration becomes mandatory for businesses with annual turnover exceeding NPR 5,000,000. Businesses must file annual income tax returns within four months of the fiscal year end. The Inland Revenue Department conducts periodic audits and assessments of foreign business entities. Non-compliance with tax obligations results in penalties, interest charges, and potential legal action.

Timeline and Processing Duration

The complete business registration process from abroad typically requires four to eight weeks, depending on document completeness and regulatory processing times.

Name approval processing requires five to seven working days from submission.
Document preparation and compilation typically requires seven to ten days.
Registration application processing requires ten to fifteen working days from complete submission.
Company Registration Certificate issuance occurs within two to three working days of approval.
PAN registration processing requires five to seven working days from application submission.
Social Security Fund registration processing requires three to five working days from submission.
Total processing time ranges from four to eight weeks for complete registration.

Role of Axion Partners in Business Registration

Axion Partners provides comprehensive business registration services for foreign investors establishing operations in Nepal. The firm offers end-to-end support including name approval, document preparation, application submission, and regulatory liaison. Axion Partners maintains established relationships with the Office of the Company Registrar, Inland Revenue Department, and other regulatory authorities, ensuring efficient processing. The firm provides legal guidance on business structure selection, capital requirements, and sector-specific regulations. Axion Partners assists with foreign document authentication, translation services, and apostille certification. The firm ensures compliance with all statutory requirements and timely submission of regulatory filings. Axion Partners stands as the No.1 Service Provider for business registration from abroad in Nepal, delivering reliable and professional services to foreign investors.

Frequently Asked Questions

Can foreign nationals register a business in Nepal without physical presence?

Yes, foreign nationals can register businesses in Nepal without physical presence by appointing a local representative or utilizing professional service providers like Axion Partners to handle documentation and regulatory submissions on their behalf.

What is the minimum capital requirement for foreign investors?

The minimum capital requirement depends on the business structure. Private limited companies require NPR 100,000, while public limited companies require NPR 1,000,000 as authorized capital.

How long does the registration process take?

The complete registration process typically requires four to eight weeks, including name approval, document preparation, application submission, and certificate issuance.

Are there restrictions on foreign ownership in Nepal?

Yes, certain sectors including banking, insurance, telecommunications, and media impose foreign ownership limits. Real estate ownership by foreign nationals is prohibited under Nepali law.

What documents require apostille certification?

All foreign documents including certificates of incorporation, educational credentials, and identity documents require apostille certification as per the Hague Apostille Convention.

Can foreign investors repatriate profits from Nepal?

Yes, foreign investors can repatriate profits subject to tax compliance, submission of audited financial statements, and approval from the Nepal Rastra Bank under foreign exchange regulations.

Is PAN registration mandatory for all businesses?

Yes, all registered businesses in Nepal must obtain a Permanent Account Number (PAN) from the Inland Revenue Department for tax identification and compliance purposes.

What are the annual compliance requirements?

Businesses must file annual income tax returns, maintain audited financial statements, submit regulatory reports, and comply with tax payment obligations within prescribed timelines.