How Long Does Company Formation Take in Nepal?

When foreign investors decide to register a company in Nepal, one of the first questions they ask is simple but critical: “How long will the process actually take?”

The answer depends on more than just filing papers at the Office of the Company Registrar (OCR). Company formation in Nepal is a multi-phase legal process governed by several authorities, the Department of Industry (DOI) or Investment Board Nepal (IBN) under the Foreign Investment and Technology Transfer Act 2019 (FITTA 2019), the Nepal Rastra Bank (NRB) for capital inflow verification, and the Inland Revenue Department (IRD) for PAN and VAT registration.

Each authority has its own review cycle, documentation standards, and verification timeline. For domestic companies, incorporation can be completed within a week. For foreign-owned companies, it typically stretches to three to five weeks, depending on investment complexity, capital source, and completeness of documentation.

This guide breaks down every stage of the company formation timeline in Nepal, from the first name reservation to post-registration compliance. It also explains what causes delays, how to plan realistic launch dates, and how Digital Consulting Ventures (DCV) helps foreign investors complete the process in record time, while staying fully compliant with Nepalese law.

1. Beyond Just OCR Registration

Most new investors assume company formation in Nepal starts and ends with the OCR, the office that issues your certificate of incorporation. But in reality, the OCR step is just one milestone in a longer legal journey.

The full timeline can be divided into three distinct phases:

Phase 1: Pre-Approval and FDI Setup

Before any foreign investor can register a company in Nepal, the investment must be formally approved under FITTA 2019. This involves preparing a proposal outlining the investor’s identity, source of funds, capital structure, and intended business activity.

• For investments below NPR 6 billion, approval is handled by the Department of Industry (DOI).

• For investments exceeding that threshold or involving special infrastructure, approval is issued by the Investment Board Nepal (IBN).

This stage typically takes 10 to 21 working days, depending on how quickly documents are verified and whether additional clarifications are requested. Many investors face delays here because of missing notarised passports, unclear shareholding breakdowns, or incomplete Memorandum and Articles of Association (MOA/AOA).

Phase 2: Company Registration at the OCR

Once the FDI approval letter is issued, you can proceed with company registration. The OCR verifies your MOA, AOA, proposed company name, registered address, and directors’ details under the Companies Act 2006 and its accompanying Rules 2064.

This stage is generally quick, around 2 to 3 business days, provided the submitted documents match the FITTA approval details and comply with the OCR’s format. Any mismatch between foreign shareholder names, passport spellings, or share capital stated in the MOA can result in re-submission requests and another week of waiting.

Phase 3: Post-Registration Compliance

After receiving your company registration certificate, your company still isn’t legally operational until you complete post-registration compliance:

• Capital Inflow Verification (NRB) — You must bring the approved foreign capital into Nepal in convertible currency through the banking channel and obtain a verification letter from the NRB. This ensures your investment is formally recorded, enabling repatriation of dividends later.

• Tax Registration (PAN & VAT) — Register with the Inland Revenue Department (IRD) within 30 days of incorporation to receive your PAN (Permanent Account Number) and, if applicable, VAT number.

• Social Security & Labor Compliance — Register employees under the Social Security Fund (SSF) and adhere to provisions of the Labor Act 2017 and Social Security Act 2018.

• Audit & Accounting Setup — Maintain accounting books as required under Companies Act Section 109 and appoint a licensed auditor.

This phase usually adds 7 to 10 business days, especially for foreign-owned companies that must complete capital inflow verification through NRB.

2. Pre-Formation Steps That Often Delay the Process

Before you even reach the Office of the Company Registrar, several pre-formation tasks can determine how smooth (or slow) your setup will be. Many foreign investors underestimate this stage, yet it is where most delays occur.

The Foreign Investment and Technology Transfer Act 2019 (FITTA 2019) sets out strict documentation and approval standards for any investment that includes foreign shareholding. The Department of Industry (DOI) or Investment Board Nepal (IBN) will not approve your proposal until every requirement is satisfied, which can take weeks if not well-prepared.

Common causes of delay include:

• Submitting draft Memorandum and Articles of Association (MOA/AOA) that do not match the proposed investment structure.

• Incomplete notarisation of passports and company charters.

• Missing lease agreements for the registered office.

• Inconsistencies between English and Nepali translations of legal documents.

Another overlooked factor is the NRB’s verification of capital inflow. Nepal Rastra Bank must confirm that the investment funds arrive through legitimate banking channels in convertible currency. Without the NRB certificate, the DOI cannot release final approval.

🟢 DCV Insight: We often advise clients to finalize all translations and legal verifications before filing their FDI application. Doing so can save an average of 10–12 business days in back-and-forth clarifications.

3. Government Authorities Involved and Their Role

Understanding which authority does what is key to planning your timeline. Each operates independently and follows its own procedural calendar.

When coordinated properly, several of these steps can overlap, for example, DCV often initiates PAN registration while NRB verification is in progress, effectively reducing total turnaround time by nearly a week.

4. Sector-Specific Timelines: Tech vs. Construction vs. Manufacturing

The industry you choose directly impacts your incorporation timeframe.

Technology & Consultancy Firms
Usually the quickest. Minimal licensing requirements and clear service descriptions make OCR approval straightforward. Average timeline: 15–20 business days including all registrations.

Construction Companies
Often the slowest. They require engineering licences, local municipal permits, and compliance with Industrial Enterprises Act 2020. Average timeline: 30–40 business days.

Manufacturing or Export-Oriented Businesses
Subject to environmental assessments and factory-operation licences, especially under the Industrial Enterprises Act 2020 and Environmental Protection Rules. Average timeline: 45–60 business days.

🟢 DCV Tip: Sector planning is not just about compliance, it affects your business launch date, staffing schedule, and initial cash flow forecast.

5. Key Factors That Influence the Timeline

While every investor’s situation is unique, these are the most consistent factors that accelerate or delay formation:

a. Nature of Investment

100% foreign ownership requires FITTA and NRB approval. Joint ventures, on the other hand, often move faster if the Nepalese partner already holds a tax ID and registered address.

b. Completeness of Documents

Every mismatch, even a misspelled passport name, can trigger OCR queries that add three to five extra business days.

c. Digital Signature Readiness

Since 2024, OCR has begun integrating digital submission and e-signature requirements. Not having verified digital credentials may delay filings.

d. Coordination Between Authorities

Unlike in some countries, Nepal’s approval system is sequential. Without DOI approval, NRB cannot act, and without NRB verification, OCR cannot finalise incorporation. Professional coordination reduces waiting periods.

6. New Digital Transformation at OCR: Faster but Stricter

A major update for 2025 is the OCR’s digital integration initiative. All company filings, from name reservation to annual returns, are moving online.

This reform has cut average registration times from four days to two but introduced stricter validation protocols. Each uploaded document is cross-checked for:

• Signature authenticity,

• Bilingual accuracy (English and Nepali), and

• Compliance with Companies Act 2006 formatting.

Foreign applicants must use digitally signed PDFs certified through an approved digital signature provider in Nepal.

🟢 DCV Advantage: We help foreign directors acquire verified e-signatures remotely and submit all filings digitally, ensuring same-day acknowledgement at OCR.

7. Capital Inflow Verification: The NRB Bottleneck

For foreign investors, this is the most unpredictable stage.

Under NRB Directives on Foreign Investment, you must remit the approved capital through a Nepali commercial bank in convertible currency. The bank reports the transaction to NRB, which then issues a Capital Inflow Verification Letter, a mandatory document for future profit repatriation or share sale.

Delays happen when:

• The remitting bank abroad fails to include the correct FDI reference code.

• The funds arrive before DOI approval (which NRB cannot verify retroactively).

• SWIFT receipts are incomplete.

With all documents correct, NRB verification typically takes 5–7 business days. Without them, it can take three weeks.

🟢 DCV Practice: We coordinate directly with both banks, the investor’s foreign bank and the local Nepali receiving bank, ensuring each SWIFT message includes the FITTA reference code and investor ID to expedite verification.

8. Post-Incorporation Registrations

Even after you get your certificate of incorporation, you are not “operational” yet.

The next five to seven days are consumed by:

1. PAN Registration — under Income Tax Act 2002, required before opening a corporate bank account.

2. VAT Registration — under VAT Act 1996, mandatory if annual turnover exceeds NPR 2 million.

3. Social Security Fund Registration — mandated by the Social Security Act 2018; employers contribute 31 % of salary (20 % employer + 11 % employee).

4. Labor Compliance — under the Labor Act 2017, each employee must have a written contract and attendance record.

5. Audit Preparation — appointing an auditor approved by Institute of Chartered Accountants of Nepal (ICAN).

🟢 DCV Checklist: We deliver a post-registration dashboard showing every compliance deadline, monthly (VAT), quarterly (TDS), and annual (audit, AGM), so clients never miss a filing.

What Delays the Process and How to Prevent It

1. Unclear Ownership Structure
   Investors sometimes submit share allocations that do not match their FITTA proposal. OCR rejects mismatched documents immediately.
   Solution: Have a lawyer review the MOA/AOA against the DOI approval before filing.

2. Late Capital Transfer
   If you delay remitting funds, NRB cannot issue verification. This also stalls PAN activation because banks need verified capital for account opening.
   Solution: Transfer funds immediately after DOI approval using the same currency and bank details stated in your proposal.

3. Incomplete Digital Submission
   Missing signature layers or improperly scanned pages are common issues.
   Solution: Use OCR-approved PDF templates; DCV can digitize all documents for clients remotely.

4. Overlapping Holidays or Audits
   Public holidays or government fiscal audits in July/August often slow OCR and DOI response times.
   Solution: Plan filings outside the fiscal-year-end window (July–September).

Realistic Timeline Summary

🟢 Fast-Track Option: With complete documentation and digital coordination, DCV has completed several FDI incorporations within 18 days.

Frequently Asked Questions

1. How long does company registration take in Nepal for foreign investors?
Usually between 20–35 business days, depending on FDI approval and NRB verification.

2. Why does the FDI approval take so long?
FITTA 2019 requires the DOI or IBN to review capital structure, ownership details, and technology transfer clauses. This legal vetting typically adds two to three weeks.

3. Can I start operations while approval is pending?
No. You cannot legally operate or hire employees until you receive your OCR certificate and PAN number.

4. Can the process be completed online?
Partially. OCR filings can be done online, but NRB verification and certain DOI approvals still require physical document submissions.

5. What’s the fastest way to incorporate?
By working with an integrated firm like DCV that prepares bilingual documents, manages DOI/NRB coordination, and files all compliance registrations in parallel.

So, how long does company formation take in Nepal?
For a local firm, just over a week. For a foreign-owned company, typically three to five weeks.

But the real differentiator isn’t just the clock. It’s how organized your documentation, banking, and approvals are. Each missed translation, each unclear share certificate, adds days or weeks.

At Digital Consulting Ventures (DCV), we streamline the entire process, from FITTA 2019 FDI approval and NRB verification to OCR registration, PAN/VAT setup, and labor compliance. With our legal, tax, and accounting experts working in sync, you can focus on strategy while we handle every regulatory step.

💬 Book a consultation today to launch your company in Nepal, faster, fully compliant, and ready to grow.