Foreign company registration in Nepal is not just about incorporating a legal entity. It is about securing the right licenses and permits to legally operate, hire staff, remit profits, and scale without regulatory friction.
Many foreign companies underestimate this step. They register a company but overlook sector approvals, local permits, or post-registration licenses. This leads to delays, banking issues, or even operational shutdowns.
This guide explains every license and permit foreign companies may need in Nepal. It is written for founders, CFOs, and expansion leaders who want clarity, speed, and compliance from day one.
Before diving into licenses, you need to understand who regulates what.
Foreign investment in Nepal is governed by multiple authorities, each with a defined role:
Investment Board Nepal (IBN) for large or strategic investments
Department of Industry (DoI) for most standard FDI projects
Office of Company Registrar (OCR) for company incorporation
Nepal Rastra Bank for foreign exchange and repatriation
Local governments for municipal permits
Each license fits into a specific stage of foreign company registration in Nepal.
Every foreign company must secure a baseline set of approvals. These apply regardless of industry.
This is the foundation of foreign company registration in Nepal.
FDI approval confirms:
The investment structure
The foreign shareholder details
The approved business activities
Depending on investment size and sector:
NPR 6 billion or above → Investment Board Nepal
Below NPR 6 billion → Department of Industry
Without this approval, no foreign-owned entity can legally operate.
Once FDI approval is granted, the company is incorporated with the Office of Company Registrar.
This certificate:
Creates the legal entity
Defines shareholding and capital
Enables contracts and employment
This is the legal birth of the foreign company in Nepal.
Tax registration is mandatory for all foreign companies.
PAN is required for:
Corporate income tax
Withholding tax
Payroll compliance
VAT registration is required if:
Annual turnover exceeds the VAT threshold
The business supplies taxable goods or services
Sector-specific licenses foreign companies often overlook
Not all businesses need the same licenses. Sector matters.
Tourism license for travel, hotels, trekking
Education approval for colleges or training institutes
Health license for clinics or diagnostics
Telecom or IT permits for regulated digital services
Failure to secure sector approval is one of the most common compliance gaps in foreign company registration in Nepal.
Obtain FDI approval
Incorporate the company
Secure sector regulator clearance
Register tax and labor obligations
Apply for municipal operating permits
Skipping step three creates downstream risk.
After national approvals, local compliance begins.
Trade license from municipality
Business signage approval
Fire and safety clearance
Environmental clearance for certain activities
These permits validate that the business can operate physically at its registered address.
Foreign companies hiring staff in Nepal must comply with labor laws.
Social Security Fund enrollment
Labor office registration
Employment contracts aligned with Nepali law
For foreign nationals:
Work permit
Non-tourist business visa
These are often reviewed during audits or banking compliance checks.
Foreign company registration in Nepal is incomplete without banking approvals.
Capital account approval
FDI inflow reporting
Share subscription certification
These steps allow:
Repatriation of profits
Dividend distribution
Intercompany payments
Banks will not process transactions without these approvals.
| Business Structure | Core Licenses Required | Additional Permits |
|---|---|---|
| Private Limited (FDI) | FDI approval, OCR registration, PAN | Sector license, municipal permit |
| Branch Office | Approval from regulator, PAN | Activity-specific permits |
| Liaison Office | Approval to operate | No revenue-generating licenses |
| Project Office | Project approval | Time-bound operating permit |
This comparison helps investors choose the right entry vehicle.
Foreign investors often ask how long licensing takes.
FDI approval: 2 to 6 weeks
Company registration: 3 to 5 working days
Tax registration: 1 to 2 days
Sector licenses: 2 to 8 weeks
Proper sequencing shortens the total timeline significantly.
Even experienced multinationals make avoidable errors.
Applying for bank accounts before approvals
Using incorrect business activity codes
Missing sector regulator clearance
Assuming licenses are “automatic”
These mistakes delay operations and create compliance exposure.
Licenses are not just compliance paperwork.
They affect:
Ability to expand activities
Ease of hiring expatriates
Smooth profit repatriation
Valuation during exits or restructuring
A clean licensing foundation supports sustainable growth in Nepal.
Licenses are not one-time events.
Most require:
Annual renewals
Activity reporting
Tax and labor filings
Non-renewal can lead to fines or suspension.
A structured compliance calendar is essential.
Foreign company registration in Nepal succeeds or fails at the licensing stage.
When licenses and permits are aligned:
Banks cooperate
Regulators trust the entity
Operations scale smoothly
When they are not, even a registered company cannot function.
If you want your foreign investment in Nepal to be defensible, scalable, and future-ready, licensing strategy must come first.
Planning foreign company registration in Nepal?
👉 Book a regulatory readiness consultation to map required licenses, timelines, and risks before you commit capital.
Yes. Any foreign ownership requires FDI approval before company registration.
No. Operating without required permits exposes the company to penalties and suspension.
Usually no, but regulated digital activities may require additional approvals.
Most licenses require annual renewal, especially municipal and sector permits.
No. Major ownership changes often require fresh approvals.