The company registration process in Nepal can look deceptively simple on paper. Online portals exist. Forms are available. Government fees are published.
Yet for foreign companies, registration is rarely just a paperwork exercise. It involves investment approvals, foreign exchange controls, sectoral restrictions, tax structuring, and employment compliance. Missing one legal step can delay operations for months or expose you to penalties later.
This guide explains whether you truly need legal help for the company registration process in Nepal, what risks foreign investors face, and how professional support protects your investment from day one.
For local entrepreneurs, company registration usually ends with incorporation at the Office of the Company Registrar (OCR).
For foreign companies, registration is only one part of a larger regulatory journey governed by multiple laws and regulators.
Foreign investors are regulated under a layered legal framework, including:
Companies Act, 2006
Foreign Investment and Technology Transfer Act (FITTA), 2019
Industrial Enterprises Act, 2020
Income Tax Act, 2002
Labour Act, 2017
Social Security Fund Act, 2018
Nepal Rastra Bank (NRB) Foreign Exchange Regulations
Each authority reviews a different aspect of your business. Legal coordination is critical.
Many guides oversimplify the process. In reality, foreign company registration involves three interlinked approvals.
Before registration, foreign companies must obtain approval from:
Department of Industry (DOI), or
Investment Board Nepal (IBN) for large projects
This approval confirms:
Sector eligibility
Minimum capital thresholds
Foreign ownership compliance
Without this, registration cannot proceed.
Once FDI approval is granted:
Name reservation
Memorandum of Association (MOA)
Articles of Association (AOA)
Shareholding structure
Errors here affect ownership, dividends, and exit rights later.
Registration does not mean you can operate immediately. You still need:
PAN and VAT registration
NRB foreign currency approvals
Bank account opening
Employment and SSF registration
Sector-specific licenses
Legal help ensures these steps run in parallel, not sequentially.
No law explicitly mandates a lawyer.
But for foreign companies, legal assistance is functionally essential due to:
Cross-border capital rules
Repatriation compliance
Shareholder protection clauses
Employment and tax exposure
In practice, regulators expect professionally drafted documents.
Foreign companies often underestimate downstream risks. The most common issues appear after registration.
Incorrect shareholding ratios
Delays in capital repatriation
Invalid dividend approvals
Labour law violations
NRB penalties for FX non-compliance
Once incorporated incorrectly, fixing mistakes requires amendments, fresh approvals, and time.
You should never proceed without legal support if:
Your business involves regulated sectors (fintech, education, health, energy)
You plan to repatriate profits or capital
You will hire local employees
You intend to scale or exit in the future
These are not optional considerations. They shape your company structure.
Below is a simplified overview of the legally compliant process.
This confirms:
Sector eligibility under FITTA
Ownership caps
Minimum investment thresholds
Documents typically include:
Investor incorporation documents
Board resolutions
Business plan and financial projections
This stage formalizes:
Share capital structure
Director powers
Profit distribution rules
You register for:
Permanent Account Number (PAN)
VAT (if applicable)
Social Security Fund
Foreign capital inflow must be:
Approved
Recorded
Properly utilized
Skipping steps here creates repatriation problems later.
Here are mistakes we see repeatedly:
Copying MOA/AOA templates without customization
Ignoring shareholder exit clauses
Registering before securing FDI approval
Underestimating employment compliance
Misclassifying capital as loans or income
These mistakes are costly and avoidable.
| Aspect | Without Legal Help | With Legal Support |
|---|---|---|
| Registration speed | Delayed by rejections | Structured and faster |
| FDI compliance | High risk of errors | Fully aligned with FITTA |
| NRB approvals | Often rejected | Correctly structured |
| Repatriation | Uncertain | Legally protected |
| Long-term scalability | Limited | Investor-ready |
Original insight: Most delays occur after incorporation, not during it.
Legal advisors do more than file forms. They:
Structure tax-efficient shareholding
Align employment contracts with labour law
Protect foreign shareholders
Enable clean exits and dividends
This transforms registration into a long-term operating strategy.
Foreign companies often trigger audits due to employment mistakes.
You must comply with:
Written employment contracts
Minimum wages and leave
Social Security Fund contributions
Termination procedures
Legal support ensures compliance from the first hire.
Repatriation is governed by:
FITTA, 2019
NRB Unified Circulars
Only legally structured companies can:
Repatriate dividends
Exit investments
Transfer technology fees
Poor registration choices block future cash flows.
Legal help is not mandatory by law, but it is strongly recommended for foreign companies due to FDI, tax, and foreign exchange regulations.
With proper legal support, it typically takes 3–6 weeks. Without support, delays can extend it to several months.
Yes, in permitted sectors under FITTA 2019. Some sectors have restrictions or require special approvals.
The minimum FDI threshold is generally NPR 20 million, subject to sector-specific rules.
Yes, but only if the company complies with FITTA, NRB regulations, and tax clearance requirements.
For foreign companies, the company registration process in Nepal is not just administrative. It is a legal foundation that affects profits, compliance, and exit options.
Legal support reduces risk, shortens timelines, and protects your investment. In Nepal’s regulated investment environment, it is not a cost. It is a safeguard.
Planning to register a company in Nepal?
Speak with our FDI and corporate compliance specialists for a free eligibility assessment and registration roadmap tailored to foreign investors.