If you are a foreign investor planning to enter Nepal, choosing between a private vs public company in Nepal is one of the most critical early decisions. This choice affects ownership control, capital raising, compliance burden, and long-term scalability. It also determines how smoothly your company registration proceeds at Nepal’s regulator.
In this guide, we break down the essential steps for company registration at Nepal’s OCR, while clearly explaining how private and public companies differ. You will gain legal clarity, practical insight, and decision-ready guidance designed specifically for foreign companies.
All companies in Nepal are registered with the Office of the Company Registrar (OCR). It operates under the Companies Act 2006, which governs incorporation, management, compliance, and dissolution.
For foreign companies, OCR registration is the legal birth of your Nepal entity. Banking, tax registration, employment, and regulatory approvals all depend on it.
At a high level, the distinction between a private and a public company in Nepal is about ownership structure and capital access.
A private company is the most common structure for foreign investors.
Key characteristics
1 to 101 shareholders
No public share offering
Share transfer restricted
Faster incorporation and lower compliance
A public company is designed for large-scale capital raising.
Key characteristics
Minimum 7 shareholders
Can issue shares to the public
Heavily regulated
Suitable for IPOs and large infrastructure projects
Choosing the wrong structure can slow approvals, raise compliance costs, and limit operational flexibility.
Foreign companies usually prioritize:
Control over ownership
Predictable compliance
Ease of capital structuring
Faster time to market
For these reasons, over 90% of foreign investors in Nepal register private companies according to OCR filings and FDI approval trends.
Whether private or public, the OCR registration process follows a structured path.
You must reserve a unique company name with the OCR.
Key rules
Name must not resemble existing entities
English or Nepali allowed
Certain regulated words require approval
This is where private vs public company in Nepal becomes legally binding.
You must declare:
Company category
Authorized capital
Shareholding structure
You must submit:
Memorandum of Association (MOA)
Articles of Association (AOA)
These define:
Business objectives
Share rights
Governance rules
Applications are filed digitally with OCR.
Required documents include:
Shareholder details
Director identification
Registered office address
Capital structure
Once approved, OCR issues a Certificate of Incorporation, making your company legally operational.
| Factor | Private Company | Public Company |
|---|---|---|
| Minimum shareholders | 1 | 7 |
| Public share issue | Not allowed | Allowed |
| Regulatory oversight | Moderate | High |
| Time to register | Faster | Slower |
| Annual compliance cost | Lower | Higher |
| Best for foreign investors | ✅ Yes | ❌ Rarely |
Insight: For foreign companies not planning an IPO, a public company structure often creates unnecessary regulatory exposure.
Nepal allows foreign ownership under the Foreign Investment and Technology Transfer Act 2019 (FITTA).
Minimum foreign investment threshold applies
Capital must be remitted through approved banking channels
OCR registration precedes FDI approval execution
Private companies provide greater flexibility in structuring foreign equity participation.
Both private and public companies must register with the Inland Revenue Department (IRD) after OCR incorporation.
However:
Public companies face stricter disclosure rules
Audit and reporting obligations are heavier
Regulatory scrutiny is higher
For foreign companies focused on operational efficiency, this matters significantly.
After OCR registration, companies must:
Register for tax (PAN)
Register with the Social Security Fund
Comply with the Labour Act 2017
Private companies typically reach hiring readiness faster.
A public company may be appropriate if:
You plan a Nepal IPO
You require mass public fundraising
You operate in regulated infrastructure sectors
For most foreign companies, these conditions do not apply at entry stage.
If your goal is:
Market entry
Back-office operations
Technology development
Regional support services
A private company in Nepal is almost always the optimal structure.
You can later convert to a public company if business needs evolve.
The private vs public company in Nepal decision is not theoretical. It directly impacts cost, speed, compliance, and control.
For foreign companies, private companies deliver:
Faster OCR approval
Lower regulatory burden
Greater ownership control
Easier compliance management
Public companies serve a narrower purpose and are best reserved for advanced capital strategies.
If you want a compliant, scalable, and foreign-friendly entry into Nepal, start private and structure smart.
A private company is usually better. It offers faster registration, lower compliance costs, and greater control for foreign shareholders.
Private company registration typically takes 7–15 working days if documents are complete and compliant.
Yes, subject to sector eligibility and FDI approval under FITTA 2019.
There is no fixed minimum for domestic companies. Foreign investment thresholds apply for FDI-based companies.
Yes. The Companies Act 2006 allows conversion with regulatory approval and compliance restructuring.