Types of companies in Nepal are clearly defined under Nepali company law and administered by the Office of the Company Registrar (OCR).
For foreign companies, choosing the right structure is the first strategic decision you will make in Nepal.
The entity you select affects ownership rights, tax exposure, profit repatriation, compliance burden, and long-term scalability.
This guide provides the most authoritative and up-to-date list of company types recognized by OCR Nepal, explained in plain language for international investors.
By the end, you will know exactly which company type fits your Nepal market entry strategy and why.
The Office of the Company Registrar (OCR) is the statutory authority responsible for:
Company incorporation and registration
Maintaining the public company registry
Approving constitutional documents
Monitoring compliance under the Companies Act
Only entities recognized by OCR Nepal can legally operate as companies in Nepal.
Foreign companies must align with these classifications to obtain approvals, open bank accounts, and hire staff.
The Private Limited Company is the most common and flexible structure in Nepal.
Key features:
Minimum shareholders: 1
Maximum shareholders: 101
Limited liability protection
Shares cannot be publicly traded
Suitable for 100% foreign ownership (subject to sector approval)
Best for:
Foreign startups, subsidiaries, joint ventures, and long-term operating businesses.
A Public Limited Company is designed for large enterprises and capital-intensive ventures.
Key features:
Minimum shareholders: 7
No maximum shareholder limit
Can issue shares to the public
Higher compliance and disclosure requirements
Mandatory governance structure
Best for:
Banks, hydropower projects, insurance companies, and large infrastructure investments.
Nepal allows incorporation with a single shareholder.
Key features:
One individual or corporate shareholder
Same legal status as a private limited company
Simplified ownership structure
Ideal for wholly owned foreign subsidiaries
Best for:
Foreign parent companies establishing full control in Nepal.
This structure is used primarily for non-profit objectives.
Key features:
No share capital
Members provide a guarantee amount
Profits cannot be distributed
Subject to strict purpose limitations
Best for:
NGOs, foundations, chambers of commerce, and development organizations.
An Unlimited Company removes the liability shield for shareholders.
Key features:
Shareholders have unlimited personal liability
Rarely used in practice
Suitable only in niche circumstances
Best for:
Highly trusted partner arrangements with minimal commercial risk.
Foreign investors do not register a “foreign company” by default.
Instead, they register one of the recognized company types with foreign ownership approval.
100% foreign-owned private limited company
Joint venture private limited company
Public limited company with foreign shareholding
All foreign-owned companies must comply with the Foreign Investment and Technology Transfer framework and sectoral caps.
Private Limited Company
Public Limited Company
Single Shareholder Company
Company Limited by Guarantee
Not-for-profit company structures
Branch Office
Liaison Office
Note: Branch and liaison offices are registered through OCR but governed by separate approval regimes.
| Company Type | Min Owners | Liability | Foreign Ownership | Compliance Level | Best Use Case |
|---|---|---|---|---|---|
| Private Limited | 1 | Limited | Allowed | Medium | Most foreign businesses |
| Public Limited | 7 | Limited | Allowed | High | Large projects |
| Single Shareholder | 1 | Limited | Allowed | Medium | Wholly owned subsidiaries |
| Guarantee Company | 1+ | Limited to guarantee | Restricted | High | NGOs & foundations |
| Unlimited Company | 2 | Unlimited | Rare | Low | Special arrangements |
Company types recognized by OCR Nepal are governed by:
Companies Act, 2006 (Nepal)
Foreign Investment and Technology Transfer Act (FITTA)
Industrial Enterprises Act
Income Tax Act
Labor Act and Social Security Act
These laws collectively regulate ownership, compliance, taxation, employment, and profit repatriation.
When registering, OCR evaluates:
Shareholding structure
Nationality of promoters
Proposed business activities
Capital structure
Constitutional documents
Based on this, OCR assigns the appropriate company classification.
Foreign investors often:
Choose public companies unnecessarily
Misclassify service offices as companies
Ignore sector-specific ownership caps
Underestimate compliance obligations
Avoiding these errors saves time, cost, and regulatory risk.
Consider these factors carefully:
Control requirements
Capital commitment
Repatriation strategy
Hiring plans
Exit options
For most foreign businesses, a private limited company remains the optimal choice.
Faster regulatory approvals
Lower compliance costs
Easier banking and payroll setup
Smoother profit repatriation
Stronger legal protection
Choosing correctly from the start reduces restructuring later.
Private limited companies are the most common due to flexibility, limited liability, and full foreign ownership options.
Yes. Many sectors allow 100% foreign ownership through a private limited company.
No. Only specific regulated sectors require public company status.
No. Branch offices are foreign extensions, not separate companies.
Private limited companies have moderate and manageable compliance requirements.
Understanding the types of companies in Nepal recognized by OCR is essential for foreign investors.
Each structure carries different legal, tax, and operational implications.
For most international businesses, a foreign-owned private limited company offers the best balance of control, compliance, and scalability.
Choosing the right company type is not just a legal step.
It is a strategic investment decision.
Planning to enter the Nepal market?
Book a consultation with our Nepal incorporation specialists to identify the ideal company type, secure approvals, and launch compliantly.