Legal Process for Private Limited Company Registration in Nepal

Imagine this, you’re a successful business owner ready to expand into South Asia. You’ve found Nepal, a market full of opportunity, low operational costs, and strategic access to India and China. But suddenly you’re lost in a maze of forms, notarizations, unclear instructions, and conflicting advice on how to register a private limited company in Nepal.

You start asking yourself, Do I need local directors? Which government body approves foreign investment? What if my documents aren’t translated correctly?

If that sounds familiar, you’re not alone. Every week, foreign founders and investors reach out to us after spending months struggling with incomplete guidance and inconsistent instructions. This article changes that.

Here, you’ll find the complete, step-by-step process of how to legally register a Private Limited Company in Nepal, what compliance steps you must follow, and how to avoid the delays that derail most investors.

Why Register a Private Limited Company in Nepal

A Private Limited Company is the most preferred business structure for both local and foreign investors. It offers credibility, flexibility, and legal protection while allowing full control of operations.

Key Advantages:

• Separate legal identity protects shareholder liability

• Ability to trade, hire, own property, and open bank accounts

• Full ownership (up to 100%) in most sectors open to FDI

• Easier profit repatriation and capital transfer

• Greater credibility with banks, clients, and regulators

Under the Companies Act 2063 (2006), a Private Limited Company is recognized as a distinct legal entity with perpetual succession. Once incorporated, your Nepal company can sign contracts, employ staff, and operate independently of the foreign parent.

Understanding Nepal’s Business Registration Framework

Before you start the registration, it’s important to understand how the system works. Nepal has modernized its registration system through the Office of the Company Registrar (OCR), an online portal that manages company name reservation and documentation.

However, foreign investors must also interact with three major authorities:

1. Department of Industry (DOI) or Investment Board Nepal (IBN) – approves foreign investment.

2. Nepal Rastra Bank (NRB) – handles foreign currency inflow and capital recordation.

3. Inland Revenue Department (IRD) – issues PAN and VAT registration.

Knowing the role of each authority will save you from delays, document rejections, or misfiling.

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

Step 1: Obtain Foreign Investment Approval

If your company is foreign-owned or receiving foreign capital, your first step is to secure approval from the DOI or IBN. You’ll need to submit:

• Application form with investment details

• Parent company documents (MoA, AoA, Certificate of Incorporation)

• Board Resolution approving investment in Nepal

• Passport copies of shareholders and directors

• Project report or business plan outlining the purpose of the investment

Once approved, the authority will issue a Letter of Approval, which allows you to proceed to the next stage.

Step 2: Name Reservation via OCR Portal

Log in to the OCR online portal to check if your proposed company name is available.
Submit up to three options and include “Private Limited” at the end of your chosen name. The OCR usually responds within a few working days.
Make sure your company name:

• Reflects your business purpose

• Doesn’t duplicate or resemble another registered name

• Doesn’t include restricted or sensitive words without permission

Step 3: Drafting Foundational Documents

Every company must prepare the following documents carefully:

Ensure all documents are translated into Nepali by a certified translator and notarized before submission.

Step 4: File Application for Company Registration

Once your documents are ready:

1. Submit all digital copies via the OCR portal.

2. Complete the online form with accurate details matching your MoA and AoA.

3. Wait for OCR review, they may request corrections or clarifications.

4. After approval, you’ll receive a Certificate of Incorporation confirming registration.

On average, this process takes around 7–10 working days for local investors and 3–4 weeks for foreign-owned companies.

Step 5: Post-Incorporation Registrations

After your company is incorporated, complete these mandatory registrations:

Timely completion ensures smooth operation and eligibility for repatriation of profits.

Foreign Investment and Capital Repatriation Rules

Nepal’s Foreign Investment and Technology Transfer Act (FITTA) 2019 governs how foreign capital enters and exits the country.

Important Highlights:

• 100% foreign ownership is allowed in most sectors except those on the negative list.

• Minimum foreign investment threshold: NPR 20 million (around USD 150,000).

• Repatriation allowed for dividends, capital, and technology fees once taxes are cleared.

• Foreign loans and royalties must be approved by NRB.

Understanding FITTA early ensures your investment remains compliant and transparent.

Common Mistakes to Avoid During Registration

1. Submitting incomplete or untranslated documents.

2. Not aligning the capital structure between the MoA and the parent resolution.

3. Ignoring negative-list restrictions.

4. Missing DOI or NRB approval before applying to OCR.

5. Forgetting annual filings and renewals.

A single missing document can delay approval by weeks, thorough preparation is everything.

Taxation and Compliance Overview for Private Limited Companies

Once registered, your company must follow ongoing tax and compliance rules:

• Corporate income tax rate: 25% (standard)

• VAT registration is mandatory if the annual turnover exceeds NPR 2 million

• Withholding tax on salaries, rent, and foreign payments

• Annual audit required by a licensed auditor

• Filing of annual returns with OCR and IRD

Complying from day one helps maintain your tax clearance and eligibility for dividend repatriation.

Comparison: Private Limited vs Branch vs Liaison Office

Most long-term investors choose the Private Limited Company model for autonomy, flexibility, and better access to local financing.

Digital Identity and Branding After Registration

Once your company is registered, your next step should be building your digital identity in Nepal.

• Secure your .np domain under your registered name.

• Develop a bilingual website to serve both local and international clients.

• Register for social media verification using your incorporation certificate.

• Set up online payment gateways through authorized banks.

Your online presence complements your legal status, positioning your company as credible and professional.

Step-by-Step Summary: Your Nepal Incorporation Checklist

1. Confirm business eligibility under FITTA

2. Obtain DOI or IBN approval for foreign investment

3. Reserve the company name on the OCR portal

4. Draft and translate the MoA and AoA

5. Prepare all supporting documents

6. File application via the OCR portal

7. Receive Certificate of Incorporation

8. Register for PAN, VAT, and local licenses

9. Open bank accounts and record foreign capital

10. Maintain annual filings and compliance

Follow this roadmap and you’ll move from concept to company without confusion.

FAQ — People Also Ask

1. How much does it cost to register a Private Limited Company in Nepal?
Registration fees depend on authorized capital. For NPR 100,000, it’s about NPR 1,000. Additional costs apply for notarization, translation, and service fees.

2. How long does the registration process take?
Generally, 7–10 working days for local entities and up to 3–4 weeks for foreign-owned firms.

3. Can foreigners own 100% of a company in Nepal?
Yes, in most sectors except those restricted under the Foreign Investment Negative List.

4. Do I need a local partner or director?
No, it’s not mandatory, but having a local authorized representative helps handle compliance and communication.

5. What happens if I start operations without registration?
Operating without registration can lead to fines, forced registration, or penalties under the Companies Act.

Launching in Nepal should feel exciting, not exhausting. At Digital Consulting Ventures (DCV), we’ve guided dozens of international companies through the legal, technical, and compliance steps of private limited company registration in Nepal.

Our team doesn’t just file paperwork. We act as your local business ally, managing OCR submissions, DOI approvals, NRB filings, tax registration, and HR setup. We ensure that your entry into Nepal is smooth, compliant, and strategically positioned for growth.

Ready to expand confidently into Nepal?
Schedule a free consultation with DCV today, and let’s turn your expansion plan into a registered success story.