If you are a foreign company evaluating private vs public company in Nepal, everything begins with the Office of Company Registrar. The OCR is the single authority responsible for company incorporation, record-keeping, and statutory oversight in Nepal.
Understanding how the OCR operates is not optional. It directly affects ownership limits, compliance exposure, timelines, and your ability to repatriate profits. This guide explains how private and public companies are treated by the OCR, what foreign investors should expect, and how to structure correctly from day one.
The Office of Company Registrar (OCR) operates under the Ministry of Industry, Commerce and Supplies. It administers the registration, regulation, and monitoring of companies under the Companies Act 2006.
In simple terms, the OCR is Nepal’s equivalent of Companies House.
The OCR is responsible for:
Company name reservation
Incorporation of private and public companies
Maintaining statutory registers
Recording shareholding and director changes
Receiving annual filings and financial statements
Enforcing compliance under company law
For foreign companies, the OCR is the first gatekeeper before any tax, banking, or labor registrations.
Foreign investors often assume “public company” sounds larger or more credible. In Nepal, that assumption can be costly.
Choosing between a private and public company affects:
Minimum capital requirements
Shareholder limits
Disclosure obligations
Fundraising flexibility
Regulatory scrutiny
The OCR applies different rules to each structure. Selecting the wrong one can delay approvals or create unnecessary compliance burdens.
The Companies Act 2006 governs both private and public companies in Nepal.
Key OCR-administered distinctions include:
Private company: Limited shareholders, restricted share transfer
Public company: Open share transfer, higher disclosure, stricter governance
The OCR ensures every incorporation aligns with the Act before issuing a registration certificate.
A private company is the most common structure for foreign businesses entering Nepal.
Minimum shareholders: 1
Maximum shareholders: 101
Share transfer restrictions apply
Cannot invite public subscriptions
Lower compliance burden
Most foreign companies choose this structure for subsidiaries, joint ventures, and operational entities.
At the OCR level, private companies must submit:
Name reservation application
Memorandum of Association
Articles of Association
Shareholder and director details
Registered office address
The OCR reviews documents for legal consistency before registration.
A public company is designed for large-scale capital mobilization.
Minimum shareholders: 7
No maximum shareholder limit
Shares freely transferable
Can issue shares to the public
Subject to enhanced governance
Public companies face deeper OCR scrutiny and additional regulator oversight.
The OCR requires:
Prospectus approval
Higher minimum paid-up capital
Independent directors
More detailed constitutional documents
This structure is rarely suitable for first-time foreign entrants.
| Criteria | Private Company | Public Company |
|---|---|---|
| Minimum shareholders | 1 | 7 |
| Maximum shareholders | 101 | Unlimited |
| Share transfer | Restricted | Freely transferable |
| Public fundraising | Not allowed | Allowed |
| OCR scrutiny | Moderate | High |
| Annual disclosure | Limited | Extensive |
| Foreign investor suitability | High | Low to medium |
Insight:
From an OCR compliance perspective, private companies are faster, cheaper, and more predictable for foreign companies.
Whether private or public, OCR registration follows a defined sequence.
The OCR verifies name uniqueness and compliance with naming rules.
Constitutional documents must align with the Companies Act and foreign ownership rules.
Although partially digital, the OCR still requires verified physical documents.
The OCR checks legal consistency, not business viability.
Issued once the OCR is satisfied.
Timeline:
Private companies usually register faster than public companies.
Foreign companies often face delays due to:
Using restricted words in company names
Submitting inconsistent shareholding details
Misclassifying private vs public intent
Ignoring sector-specific approvals
The OCR does not correct strategy errors. It simply rejects non-compliant filings.
OCR compliance does not end at incorporation.
Companies must file:
Annual returns
Financial statements
Director and shareholder changes
Capital amendments
Private companies face lighter reporting. Public companies face deeper scrutiny and penalties for non-compliance.
The OCR works alongside:
Inland Revenue Department
Nepal Rastra Bank
Department of Industry
However, OCR approval is foundational. Other registrations depend on it.
For most foreign companies:
Private company is the default choice
Public company suits regulated, capital-intensive ventures
Choosing private vs public company in Nepal should be a legal decision first, not a branding decision.
The OCR enforces transparency and corporate discipline. Incorrect classification can result in:
Registration rejection
Forced restructuring
Compliance penalties
Getting the structure right protects long-term operations.
Yes. Private companies have fewer compliance requirements and faster OCR approval, making them ideal for foreign investors.
Yes, but it requires higher capital, more shareholders, and stricter OCR and regulatory oversight.
Private companies register faster. Public companies take longer due to enhanced scrutiny.
No. The OCR checks company law compliance only. Other approvals may still apply.
Yes. Conversion is allowed but requires OCR approval and additional compliance steps.
Choosing private vs public company in Nepal is not just a legal formality. It is a strategic decision governed by the Office of Company Registrar.
For most foreign companies, a private company offers speed, flexibility, and lower risk. Public companies suit only specific, large-scale objectives.
Getting OCR strategy right from the start saves time, money, and regulatory friction.