From Application to Approval: Documents Needed for Private Company Registration in Nepal

If you are a foreign investor evaluating private vs public company in Nepal, the very first practical question is simple: what documents do I actually need to register a private company, and how long does approval take?

Nepal has made company incorporation clearer over the past decade, but documentation remains the single biggest cause of delays. Missing one clause in the Memorandum or an incorrectly notarized passport can push timelines back weeks.

This guide walks you from application to approval. It explains private vs public company in Nepal, lists every document required for private company registration, and highlights where foreign companies usually get stuck.

Understanding Private vs Public Company in Nepal

Before diving into paperwork, you must choose the correct legal structure. The decision between a private and public company affects ownership limits, capital thresholds, compliance, and future fundraising.

What Is a Private Company in Nepal?

Under the Companies Act, a private company in Nepal is designed for closely held ownership.

Key characteristics:

• Maximum 101 shareholders
• No public invitation to subscribe shares
• Lower disclosure and compliance burden
• Preferred by foreign subsidiaries and joint ventures

What Is a Public Company in Nepal?

A public company is structured for scale and capital markets.

Key characteristics:

• Minimum 7 shareholders
• May invite the public to subscribe shares
• Higher paid-up capital requirements
• Mandatory stricter governance and disclosures

Why Most Foreign Companies Choose Private Companies

For foreign investors, the private vs public company in Nepal decision is straightforward in most cases.

Private companies offer:

• Faster registration
• Easier control and governance
• Lower compliance costs
• Flexibility to convert into a public company later

Private vs Public Company in Nepal: Key Differences at a Glance

This comparison alone resolves the private vs public company in Nepal dilemma for most foreign entrants.

Regulatory Framework Governing Company Registration in Nepal

Private company registration in Nepal is governed by multiple authorities and laws.

Core Laws and Guidelines

• Companies Act, 2006
• Foreign Investment and Technology Transfer Act (FITTA), 2019
• Industrial Enterprises Act, 2020
• Income Tax Act, 2002

Key Authorities

• Office of Company Registrar
• Department of Industry
• Nepal Rastra Bank
• Inland Revenue Department

Understanding this framework strengthens compliance and EEAT credibility.

Documents Needed for Private Company Registration in Nepal

This is the most critical section. Every document listed below is mandatory unless specifically exempted.

1. Company Name Reservation Certificate

Before preparing incorporation documents, you must reserve a unique company name.

Requirements:

• Three proposed names
• Clear description of business activities
• Online submission through OCR portal

2. Memorandum of Association (MOA)

The MOA defines the company’s legal identity.

It must include:

• Company objectives
• Authorized capital
• Shareholding structure
• Liability clause

Foreign investors often delay approval by using generic objectives. Precision matters.

3. Articles of Association (AOA)

The AOA governs internal management.

It covers:

• Director powers
• Share transfer rules
• Meeting procedures
• Dividend policies

MOA and AOA must be signed by all promoters.

Promoter and Shareholder Documents

Foreign promoters must submit notarized and, in some cases, apostilled documents.

Individual Foreign Shareholders

• Passport copy
• Passport-size photographs
• Permanent address proof
• Board resolution if acting on behalf of an entity

Corporate Foreign Shareholders

• Certificate of incorporation
• Charter documents
• Board resolution approving Nepal investment
• Authorized signatory details

These documents are frequently scrutinized during foreign investment approval.

Local Director and Company Officials’ Documents

A private company in Nepal must appoint at least one director.

Required documents:

• Citizenship certificate or passport
• Consent letter
• Signature specimen

Foreign nationals may serve as directors, subject to visa compliance.

Registered Office Address Proof

Every private company must declare a registered office in Nepal.

Accepted proofs:

• Lease agreement
• Ownership certificate
• No-objection letter from landlord

The address must match municipality records exactly.

Capital Structure and Share Subscription Documents

You must submit clear evidence of capital commitment.

This includes:

• Share subscription agreement
• Capital structure breakdown
• Promoter contribution schedule

For foreign investors, this ties directly into NRB capital inflow approvals.

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

Here is a simplified flow from application to approval.

1. Reserve company name at OCR
2. Draft MOA and AOA
3. Prepare promoter and director documents
4. Submit incorporation application
5. Obtain Certificate of Incorporation
6. Register for PAN and local taxes

Each step builds on the previous one. Errors compound quickly.

Common Mistakes Foreign Companies Make

Foreign investors often misunderstand Nepal’s documentation expectations.

Frequent issues include:

• Overly broad business objectives
• Inconsistent promoter names across documents
• Improper notarization
• Ignoring sectoral investment restrictions

Avoiding these mistakes speeds approval significantly.

Post-Incorporation Registrations You Cannot Ignore

Company registration is only the beginning.

Mandatory post-registration steps:

• PAN registration
• Bank account opening
• Social Security Fund enrollment
• Local ward registration

Skipping these can expose directors to penalties.

Compliance Differences After Registration

This is where private vs public company in Nepal continues to matter.

Private companies enjoy:

• Fewer reporting requirements
• Simpler board structures
• Lower audit thresholds

Public companies face:

• Mandatory audits regardless of size
• Enhanced disclosures
• Regulator oversight

Timeline: How Long Does Private Company Registration Take?

With correct documents:

• Name reservation: 1–2 days
• OCR approval: 5–7 working days
• PAN registration: 1–2 days

Delays usually stem from document errors, not bureaucracy.

Cost Considerations for Foreign Investors

Costs vary based on capital and advisory support.

Typical cost heads:

• Government registration fees
• Notarization and legalization
• Professional drafting and compliance support

Private companies are significantly more cost-efficient than public ones.

When Should You Consider a Public Company Instead?

A public company makes sense when:

• You plan an IPO
• You need large-scale public capital
• Regulatory credibility is critical

For market entry, private companies remain superior.

Why Professional Support Matters

Nepal’s laws are clear on paper but nuanced in practice.

Professional advisors help:

• Structure compliant objectives
• Align documents with FITTA
• Coordinate OCR, DOI, and NRB approvals

This reduces risk and accelerates market entry.

Conclusion: Choosing Right in Private vs Public Company in Nepal

For foreign companies, the private vs public company in Nepal decision almost always favors private company registration. It offers speed, control, and flexibility while keeping compliance manageable.

With the right documents prepared upfront, private company registration in Nepal can be smooth and predictable.

If you want a clear checklist and regulator-ready documentation, expert guidance makes the difference between approval in days versus months.

Frequently Asked Questions

Is a private company better than a public company in Nepal for foreigners?

Yes. Private companies offer lower compliance, faster setup, and better control for foreign investors.

How many shareholders are allowed in a private company in Nepal?

A private company can have up to 101 shareholders.

Can a foreigner be a director of a Nepali private company?

Yes. Foreign nationals may act as directors, subject to visa and immigration rules.

What is the minimum capital for private company registration?

There is no universal minimum. Capital depends on sector and foreign investment rules.

Can a private company later become public in Nepal?

Yes. A private company can convert into a public company after meeting statutory requirements.