Navigating Company Name Application in Nepal: Tips and Tricks

Choosing between a private vs public company in Nepal starts earlier than most foreign investors expect.
It begins with company name application.

In Nepal, a rejected name can delay incorporation by weeks. For foreign companies, that delay often means missed contracts, visa timelines, and banking slots.

This guide explains how private and public companies differ, how company name approval works in Nepal, and the exact strategies foreign founders use to get approved faster.

We combine legal clarity, regulatory insight, and practical tips used in real incorporations.

Understanding Private vs Public Company in Nepal

Before filing a name, you must choose the company type. Nepalese law treats private and public companies very differently.

Legal Basis

Company formation in Nepal is governed by the Companies Act 2006 and administered by the Office of Company Registrar (OCR).

Both private and public companies must receive name approval before registration.

What Is a Private Company in Nepal?

A private company is the most common structure for foreign companies entering Nepal.

Key Characteristics

• Maximum 101 shareholders

• Shares not offered to the public

• Flexible governance

• Lower compliance burden

• Faster approval timelines

Common Use Cases

• Subsidiaries of foreign companies

• Back-office or support entities

• IT, BPO, and service companies

• Trading and consulting firms

Most foreign investors choose private companies due to speed and control.

What Is a Public Company in Nepal?

A public company is designed for scale, capital markets, and public investment.

Key Characteristics

• Minimum 7 shareholders

• Shares can be publicly offered

• Mandatory board structure

• Higher disclosure requirements

• Subject to securities regulations

Common Use Cases

• Infrastructure projects

• Banks and financial institutions

• Large manufacturing ventures

• IPO-driven growth strategies

For name approval, public companies face stricter scrutiny.

Private vs Public Company in Nepal: Core Differences

Insight:
Over 85% of foreign incorporations in Nepal choose private company status due to faster OCR approval and simpler governance.

Why Company Name Application Matters More Than You Think

Company name approval is not a formality.

The OCR evaluates names for:

• Legal compliance

• Similarity to existing companies

• Sector sensitivity

• Public interest concerns

A weak name choice leads to rejection, resubmission, and delays.

Step-by-Step: Company Name Application in Nepal

1. Preliminary Name Search

Before filing, check OCR’s database for:

• Identical names

• Phonetically similar names

• Confusing abbreviations

Foreign brands often fail here.

2. Sector Relevance Check

Your proposed name must align with:

• Stated objectives

• Industry classification

• Licensing requirements

A mismatch is a common rejection reason.

3. Online Name Reservation Filing

Applications are submitted through the OCR portal with:

• Proposed name

• Alternate name options

• Company type (private or public)

• Brief objective statement

4. Registrar Review

The OCR reviews for compliance with the Companies Act and public policy norms.

5. Approval or Rejection

Approved names are reserved for a limited time to complete registration.

Private vs Public Company in Nepal: Name Approval Rules Compared

For Private Companies

Private company names must:

• Be unique

• Avoid restricted words

• Reflect business purpose

• Avoid misleading associations

Approval is usually faster.

For Public Companies

Public company names face additional checks:

• No implication of government backing

• No exaggerated financial claims

• No resemblance to regulated institutions

• Higher public interest scrutiny

Expect longer review timelines.

Restricted Words You Must Avoid

Certain words require special approvals or are outright restricted.

Commonly flagged terms include:

• Bank

• Finance

• Trust

• Cooperative

• Government

• Authority

Using these without licenses almost guarantees rejection.

Practical Tips to Get Your Company Name Approved Faster

Use These Proven Strategies

1. Combine brand + activity

2. Add geographic or functional identifiers

3. Avoid generic English-only names

4. Provide clear objectives

5. Submit multiple alternatives

Foreign investors who submit three well-structured options see higher success rates.

Private vs Public Company in Nepal: Foreign Investor Considerations

Foreign companies should align name strategy with:

• FDI approval requirements

• Banking compliance

• Tax registration

• Employment permits

A name that passes OCR but fails at the bank creates future risk.

Common Reasons for Name Rejection in Nepal

• Similarity to existing companies

• Misleading industry signals

• Use of restricted terminology

• Conflict with public policy

• Inconsistent objectives

Understanding these reduces iteration cycles.

How Company Type Impacts Long-Term Compliance

Choosing between a private vs public company in Nepal affects more than name approval.

Private Company Compliance

• Annual filings

• Tax returns

• Shareholder resolutions

Public Company Compliance

• Public disclosures

• Regulatory audits

• Share issuance compliance

• Securities filings

Name choice should reflect future obligations, not just launch speed.

Why Foreign Companies Prefer Private Companies in Nepal

Foreign investors value:

• Predictability

• Control

• Speed

• Lower compliance risk

Private companies deliver all four.

Public companies are typically chosen only when legally required.

Conclusion: Private vs Public Company in Nepal

The decision between a private vs public company in Nepal shapes your entire market entry.

Company name application is the first regulatory signal you send to authorities, banks, and partners.

For most foreign companies, a private company with a strategically crafted name offers faster approval, lower risk, and operational flexibility.

Getting this right from day one saves months later.

Frequently Asked Questions

1. Can foreign companies register a public company in Nepal?

Yes, but it requires higher capital, more shareholders, and stricter regulatory oversight.

2. How long does company name approval take in Nepal?

Private companies typically receive approval within a few working days. Public companies take longer.

3. Can I reserve a company name before finalizing incorporation?

Yes. Approved names are reserved for a limited period to complete registration.

4. Are English company names allowed in Nepal?

Yes, but they must be unique and not misleading or restricted.

5. What happens if my company name is rejected?

You must resubmit with revised or alternate names, causing delays.