Complete Process for Foreign Company Registration in Nepal

Foreign company registration in Nepal is no longer a niche move. It is a strategic decision for global companies seeking cost-efficient talent, South Asian market access, and long-term growth.

Nepal offers liberal foreign investment rules, competitive operating costs, and strong protections for overseas investors. But the registration process is legal-heavy and compliance-driven. One mistake can delay approvals for months.

This guide gives you the most authoritative, up-to-date, and practical explanation of foreign company registration in Nepal. It is written for founders, CFOs, legal heads, and expansion leaders.

You will learn the exact entry routes, legal steps, documents, timelines, costs, and compliance obligations.

What Does Foreign Company Registration in Nepal Mean?

Foreign company registration in Nepal refers to the legal approval for an overseas entity to operate commercially in Nepal under Nepali law.

It is governed primarily by:

• Department of Industry

• Office of Company Registrar

Registration is mandatory if a foreign company intends to:

• Earn revenue in Nepal

• Hire employees locally

• Open bank accounts

• Lease office premises

• Repatriate profits legally

Foreign Company Registration in Nepal – Entry Options Explained

Nepal allows multiple legal entry routes. Choosing the wrong one increases tax and compliance risk.

1. Foreign Direct Investment (FDI) Company

This is the most common and scalable route.

• Incorporated as a Private Limited Company

• Minimum foreign ownership: 100 percent allowed

• Eligible for profit repatriation

• Subject to full tax and labor laws

Best for long-term operations, tech firms, service companies, and manufacturers.

2. Branch Office Registration

A branch office is an extension of the foreign parent.

• No separate legal identity

• Limited to approved activities

• Parent company bears liabilities

Best for execution of contracts and short-term projects.

3. Liaison Office Registration

A liaison office is non-commercial.

• No revenue generation allowed

• Limited to market research and coordination

• Cannot invoice clients

Best for early market exploration.

Comparison Table: Choosing the Right Entry Model

Key Laws Governing Foreign Company Registration in Nepal

Foreign companies are protected and regulated under clear legislation.

• Foreign Investment and Technology Transfer Act 2019

• Companies Act 2006

• Industrial Enterprises Act 2020

• Income Tax Act 2002

• Labour Act 2017

These laws guarantee national treatment, repatriation rights, and legal protection for foreign investors.

Step-by-Step Process for Foreign Company Registration in Nepal

Step 1: Investment Approval from Department of Industry

You must first obtain FDI approval from the Department of Industry.

Documents include:

• Parent company incorporation certificate

• Board resolution approving Nepal investment

• Passport copies of shareholders and directors

• Business plan and financial projections

Step 2: Company Name Reservation

The proposed company name is reserved at the Office of Company Registrar.

• Must not conflict with existing entities

• Must reflect permitted activities

Step 3: Company Incorporation

After approval, the company is legally incorporated.

You will receive:

• Certificate of Incorporation

• Memorandum and Articles of Association

Step 4: Capital Injection Through Banking Channel

Foreign capital must enter Nepal through:

• Nepal Rastra Bank approved channels

• Authorized commercial banks

This step is critical for future profit repatriation.

Step 5: Tax and PAN Registration

Every foreign-owned company must register for:

• Permanent Account Number

• VAT registration if applicable

Step 6: Local Compliance and Licensing

Depending on the sector, additional licenses may be required.

Examples include IT, education, fintech, and manufacturing.

Documents Required for Foreign Company Registration in Nepal

From the Parent Company

• Certificate of Incorporation

• Memorandum and Articles

• Board resolution

• Audited financials

From the Nepal Entity

• Lease agreement

• Local director details

• Company bylaws

Timelines and Cost Expectations

Average timelines

• FDI approval: 15–30 working days

• Company registration: 7–10 days

• Banking and tax setup: 10–15 days

Typical cost components

• Government fees

• Legal drafting

• Notarization and translation

• Compliance setup

Exact costs vary by sector and capital size.

Post-Registration Compliance You Must Not Ignore

Foreign company registration in Nepal does not end at incorporation.

Ongoing obligations include:

• Monthly tax filings

• Annual audits

• Social Security Fund contributions

• Labor law compliance

• Annual DOI reporting

Non-compliance can lead to fines and repatriation delays.

Repatriation of Profit and Capital

Nepal allows full repatriation of:

• Dividends

• Royalties

• Technical service fees

• Sale proceeds

Repatriation must comply with Nepal Rastra Bank guidelines and proper documentation.

Common Mistakes Foreign Companies Make

Avoid these costly errors:

• Choosing a liaison office for revenue activities

• Injecting capital outside banking channels

• Ignoring labor compliance

• Using generic MOA templates

Expert structuring saves time and money.

Why Nepal Is Attractive for Foreign Companies

Nepal offers:

• Competitive labor costs

• English-speaking workforce

• Strategic India-China location

• Liberal foreign ownership rules

• Stable FDI policy framework

These advantages make foreign company registration in Nepal increasingly attractive.

Frequently Asked Questions (People Also Ask)

Is foreign company registration in Nepal allowed for 100 percent ownership?

Yes. Nepal allows 100 percent foreign ownership in most sectors under FITTA 2019.

What is the minimum investment required?

The standard minimum foreign investment threshold is NPR 20 million, subject to sector rules.

Can a foreign company hire staff in Nepal?

Yes. Registered foreign companies can legally hire Nepali and expatriate employees.

How long does foreign company registration in Nepal take?

On average, 30–45 working days if documents are complete.

Can profits be repatriated outside Nepal?

Yes. Profits and capital can be repatriated with Nepal Rastra Bank approval.

Conclusion

Foreign company registration in Nepal is a powerful gateway to South Asia when done correctly.

With the right legal structure, compliance strategy, and professional support, Nepal offers a secure and scalable base for global operations.

The key is precision, compliance, and expert guidance from day one.

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