Choosing between a private vs public company in Nepal is one of the first structural decisions foreign companies must make.
It affects ownership control, compliance burden, capital strategy, and long-term scalability.
The good news is that online company registration in Nepal has become far more efficient. The government’s digital systems, led by the Office of the Company Registrar, now allow faster filings, clearer approvals, and fewer procedural risks for overseas founders.
In this guide, we explain how the OCR simplifies the process, and how foreign companies should evaluate private versus public company structures in Nepal with confidence.
The Office of the Company Registrar (OCR) is the central authority responsible for company incorporation and records.
Over the last few years, OCR has digitized most incorporation steps. For foreign companies, this shift reduces delays, paperwork errors, and dependency on in-person follow-ups.
Online registration does not eliminate documentation. It streamlines submission and tracking.
You can now:
Reserve company names digitally
Submit incorporation applications online
Upload constitutional documents electronically
Track approval status in real time
However, foreign ownership still requires certified, notarized, and apostilled documents from the parent jurisdiction.
For foreign investors, the choice between a private and public company is strategic, not cosmetic.
It determines:
Who can own shares
How capital can be raised
Disclosure and audit intensity
Exit flexibility
Most foreign companies entering Nepal opt for a private company. Public companies serve a narrower purpose.
Company registration and classification are governed primarily by:
Companies Act, 2006
Company Regulations issued by OCR
Foreign Investment and Technology Transfer Act, 2019 (where applicable)
These laws clearly distinguish private vs public company in Nepal based on share transferability, shareholder limits, and capital rules.
A private company in Nepal is a closely held corporate entity with restricted ownership.
Minimum shareholders: 1
Maximum shareholders: 50 (excluding employees)
Shares cannot be offered to the public
Lower compliance and disclosure obligations
For foreign companies, private entities provide operational control and flexibility.
Foreign companies commonly use private companies for:
Wholly owned subsidiaries
Joint ventures with limited partners
Operating companies for Nepal market entry
Back-office, tech, or service delivery units
A public company in Nepal is designed for capital aggregation from a broader investor base.
Minimum shareholders: 7
No maximum shareholder limit
Shares can be offered to the public
Mandatory higher capital and reporting standards
Public companies are usually linked to:
Large infrastructure projects
Financial institutions
IPO-driven growth strategies
| Feature | Private Company | Public Company |
|---|---|---|
| Minimum shareholders | 1 | 7 |
| Maximum shareholders | 50 | Unlimited |
| Public share offering | Not allowed | Allowed |
| Compliance intensity | Moderate | High |
| Capital flexibility | Controlled | Broad |
| Foreign investor suitability | High | Limited |
| Time to register | Faster | Slower |
Insight:
For 90% of foreign investors, a private company in Nepal is the correct entry vehicle.
OCR’s online systems reduce friction across both structures.
Digital name reservation reduces rejection cycles
Online document uploads minimize physical handling
Standardized forms lower legal ambiguity
Status tracking improves planning certainty
These improvements are especially valuable for overseas founders managing incorporation remotely.
Below is a simplified registration flow.
Submit proposed company names through the OCR portal.
Prepare:
Memorandum of Association
Articles of Association
Shareholder and director details
Foreign entities must provide notarized and apostilled parent documents.
Upload documents and submit the incorporation application online.
OCR reviews compliance and issues the registration certificate.
PAN registration
Bank account opening
Sectoral approvals, if required
Foreign investors often underestimate Nepal’s procedural nuances.
Avoid these pitfalls:
Choosing public companies unnecessarily
Submitting improperly apostilled documents
Misclassifying business activities
Ignoring sector-specific approval requirements
These errors delay approvals and increase regulatory risk.
Public companies are suitable only when:
Capital must be raised from many investors
Listing is planned in Nepal
Regulatory compliance capacity is strong
For most foreign companies, this threshold is unnecessary at entry.
Both company types are subject to:
Corporate income tax
Withholding tax obligations
Annual filings with OCR
However, public companies face stricter audits and disclosures.
This difference materially affects compliance cost and management effort.
Foreign companies often ask whether starting private limits growth.
It does not.
A private company can later:
Increase capital
Add shareholders
Convert into a public company
Starting private preserves flexibility while reducing early-stage risk.
Foreign founders prioritize:
Control
Predictable compliance
Faster setup
Lower regulatory exposure
Private companies align with these objectives better than public structures.
For foreign companies, the private vs public company in Nepal decision should be driven by strategy, not assumption.
With OCR’s online registration system, incorporation is faster and clearer than ever.
For most investors, a private company offers the right balance of control, scalability, and compliance efficiency.
If you are planning to enter Nepal, structure correctly from day one.
The right entity choice reduces risk and accelerates growth.
Most steps are digital, but foreign documents must still be notarized and apostilled before upload.
Yes, subject to sectoral rules and foreign investment approval where required.
A private company is generally the fastest to register.
Yes. Conversion is permitted under the Companies Act.
No. Large investments can also be structured through private companies.