Foreign company registration in Nepal is increasingly on the radar of global firms exploring South Asia. If your goal is market research, brand presence, or government liaison without trading locally, a Liaison Office is often the smartest entry route. This guide explains, step by step, how foreign companies can register a Liaison Office in Nepal, what approvals are required, realistic timelines, costs, and compliance obligations. You will also learn when a Liaison Office is not enough and when to upgrade to a branch or FDI subsidiary.
A Liaison Office is a non-commercial presence of a foreign company in Nepal. It acts as a communication and coordination channel between the head office and Nepali stakeholders.
Market research and feasibility studies
Brand representation and promotional activities
Coordination with regulators, partners, and vendors
Information gathering and reporting to head office
Generate revenue in Nepal
Sign commercial contracts locally
Issue invoices or receive local business income
This restriction is the core reason regulators treat Liaison Offices differently from branches or subsidiaries.
For many first-time entrants, a Liaison Office offers speed, lower risk, and regulatory clarity.
No minimum capital requirement
Faster approval than a branch or FDI entity
Lower compliance burden
Ideal for testing the Nepali market
Technology companies exploring offshore talent
Manufacturing firms scouting suppliers
Professional services firms building government relationships
NGOs and multinationals coordinating regional projects
Liaison Office registration is governed by multiple authorities and statutes in Nepal.
Department of Industry
Nepal Rastra Bank
Ministry of Industry, Commerce and Supplies
Foreign Investment and Technology Transfer Act, 2019
Companies Act, 2006
Nepal Rastra Bank Foreign Exchange Management Directives
These frameworks ensure that Liaison Offices remain non-commercial and properly funded from abroad.
The parent company must formally approve the establishment of a Liaison Office in Nepal.
Required actions
Board resolution approving Nepal Liaison Office
Appointment of a Chief Representative
Commitment to fund operations from overseas
An application is submitted to the Department of Industry with supporting documents.
Typical documents
Certificate of incorporation of the parent company
Memorandum and Articles of Association
Board resolution and power of attorney
Profile and financials of the parent company
All foreign documents must be notarised and, where required, consularised.
Once DoI approval is secured, the file moves to Nepal Rastra Bank for foreign exchange clearance.
NRB focuses on
Source of funds
Annual operating budget
Repatriation and remittance controls
This approval allows inward remittance for operating expenses.
After regulatory approvals:
Liaison Office registration certificate is issued
Permanent Account Number (PAN) is obtained
Local bank account is opened for expense management
The office can now legally operate within its permitted scope.
Activation checklist
Lease agreement for office premises
Hiring local staff
Payroll and tax registrations
Compliance calendar setup
| Stage | Estimated Timeline |
|---|---|
| Document preparation | 1–2 weeks |
| Department of Industry approval | 2–3 weeks |
| Nepal Rastra Bank approval | 2–4 weeks |
| Tax and local registration | 1 week |
| Total expected timeline | 4–8 weeks |
Timelines depend heavily on document readiness and regulatory workload.
A Liaison Office is cost-efficient compared to other entry models.
Government application and registration fees
Legal and advisory fees
Notarisation and consularisation costs
Annual operating budget remitted from abroad
Unlike FDI subsidiaries, there is no statutory minimum capital requirement.
| Factor | Liaison Office | Branch Office | FDI Subsidiary |
|---|---|---|---|
| Commercial activity | Not allowed | Allowed | Fully allowed |
| Revenue generation | No | Yes | Yes |
| Capital requirement | None | Prescribed | Sector-based |
| Compliance burden | Low | Medium | High |
| Best for | Market entry | Project execution | Long-term operations |
This comparison helps foreign companies avoid structural mismatches.
Even without commercial activity, compliance is mandatory.
Annual activity reporting to DoI
Budget utilisation reporting to NRB
Tax filings for payroll and withholding taxes
Renewal of Liaison Office approval
Non-compliance can result in fines or revocation.
Treating a Liaison Office as a sales office
Underestimating document legalisation timelines
Hiring staff before approvals
Mixing liaison activities with revenue generation
Early advisory support prevents costly restructuring.
A Liaison Office is a starting point, not a destination.
You need to sign local contracts
You plan to invoice Nepali clients
You want to hire at scale
You are ready for long-term investment
At that stage, a branch or FDI subsidiary becomes appropriate.
Foreign company registration in Nepal involves regulatory coordination, not just form filing. Experienced advisors reduce approval risk, timelines, and compliance exposure.
An expert partner helps you
Choose the correct entry structure
Prepare regulator-ready documentation
Coordinate approvals end-to-end
Maintain long-term compliance
Planning foreign company registration in Nepal through a Liaison Office?
Book a consultation with our Nepal market-entry specialists to receive a tailored feasibility assessment, compliance roadmap, and timeline.
No. A Liaison Office cannot generate revenue or issue invoices locally. All expenses must be funded from overseas remittances.
No. It is not treated as FDI because no equity or capital investment is made in Nepal.
Approvals are typically issued for one year and must be renewed annually based on compliance and reporting.
Yes. It can hire local staff, subject to labour laws and payroll tax compliance.
Yes. Many foreign companies later upgrade to an FDI subsidiary once commercial operations are planned.