Starting a Business in Nepal Here’s How to Register Your Company First

Company registration in Nepal is the first and most critical step for foreign companies planning to enter South Asia’s emerging markets. Nepal offers competitive labour costs, a growing digital workforce, strategic access to India and China, and strong legal protections for foreign investors.

Yet, the registration process can feel complex. Multiple authorities, sector-specific approvals, and foreign investment rules often confuse first-time entrants.

This guide simplifies everything. You will learn how to register a company in Nepal legally, efficiently, and compliantly, whether you are a startup founder, SME, or multinational executive.

Why Foreign Companies Are Choosing Nepal

Nepal is no longer just a tourism economy. It is becoming a regional hub for IT, outsourcing, professional services, energy, education, and manufacturing.

Key advantages include:

• Cost-efficient skilled workforce

• English-speaking professionals

• Favourable foreign investment laws

• Full profit and capital repatriation rights

• Government-supported FDI framework

According to Nepal Rastra Bank and the Department of Industry, foreign direct investment approvals have steadily increased year-on-year, especially in IT and services.

What Is Company Registration in Nepal?

Company registration in Nepal refers to the legal incorporation of a business entity under the Companies Act, 2006, through the Office of the Company Registrar (OCR).

Once registered, the company becomes a separate legal entity with rights to:

• Enter contracts

• Hire employees

• Open bank accounts

• Pay taxes

• Repatriate profits (for foreign investors)

Types of Business Entities Foreigners Can Register

Choosing the right structure is a strategic decision. The most common options include:

Private Limited Company

The preferred structure for foreign companies.

Features:

• Separate legal identity

• Limited liability

• Shareholders can be foreign nationals

• Suitable for FDI, subsidiaries, and joint ventures

Branch Office

Best for companies wanting a direct presence without incorporation.

Features:

• Extension of parent company

• Cannot generate independent profits

• Requires annual renewals

Liaison Office

Used for market research and coordination.

Features:

• No commercial activities

• No revenue generation

• Strict regulatory scope

Representative Office

Often used by NGOs and international organisations.

Company Registration in Nepal for Foreigners: Legal Framework

Foreign company registration is governed by multiple laws:

• Companies Act, 2006

• Foreign Investment and Technology Transfer Act (FITTA), 2019

• Industrial Enterprises Act, 2020

• Income Tax Act, 2002

• Labour Act, 2017

These laws collectively ensure investor protection, transparency, and repatriation guarantees.

Step-by-Step Company Registration Process in Nepal

1. Name Reservation at OCR

You must first reserve a unique company name through the Office of the Company Registrar.

Tips:

• Avoid restricted or sensitive terms

• Include business objectives aligned with your sector

2. Drafting Constitutional Documents

You will prepare:

• Memorandum of Association (MOA)

• Articles of Association (AOA)

These define your capital structure, governance, and activities.

3. Company Incorporation Approval

Once submitted, OCR reviews and issues:

• Certificate of Incorporation

• Company Registration Number

4. Foreign Investment Approval

Foreign shareholders must obtain approval from:

• Department of Industry (DOI) or

• Investment Board Nepal (IBN), depending on project size

5. Capital Injection

FDI capital must be remitted through a Nepal Rastra Bank-approved bank.

6. PAN and VAT Registration

Register with the Inland Revenue Department for tax compliance.

7. Local Licences and Sector Approvals

Certain sectors require additional permits.

Typical Timeline for Company Registration in Nepal

Total average timeline: 4–6 weeks

Cost of Company Registration in Nepal

Registration costs vary based on authorised capital.

Government Fees (Indicative)

• NPR 1 million capital: approx. NPR 9,500

• NPR 10 million capital: approx. NPR 19,000

Additional costs include:

• Legal drafting

• Translation and notarisation

• FDI approval processing

• Accounting setup

Key Compliance Obligations After Registration

Foreign companies must maintain ongoing compliance.

These include:

• Annual financial audits

• Tax filings and advance tax payments

• Labour law compliance

• Social Security Fund contributions

• Annual OCR filings

Non-compliance may result in penalties or licence suspension.

Common Mistakes Foreign Companies Should Avoid

1. Choosing the wrong entity structure

2. Underestimating compliance costs

3. Incomplete FDI documentation

4. Improper capital repatriation planning

5. Operating before approvals

Avoiding these mistakes saves months of delay.

Company Registration in Nepal vs Employer of Record (EOR)

Many foreign companies start with EOR before full registration.

Taxation Overview for Foreign-Owned Companies

Key tax rates:

• Corporate tax: 25% (standard)

• Dividend tax: 5%

• VAT: 13%

Nepal has double taxation avoidance agreements (DTAAs) with several countries.

Repatriation of Profits and Capital

Foreign investors are legally entitled to repatriate:

• Dividends

• Sale proceeds of shares

• Loan repayments

• Technology fees

Approvals are processed through Nepal Rastra Bank under FITTA 2019.

Why Professional Support Matters

While online portals exist, foreign company registration in Nepal is not fully self-service.

Professional advisors help with:

• Regulatory navigation

• FDI structuring

• Banking coordination

• Compliance management

This reduces legal risk and accelerates market entry.

Final Thoughts on Company Registration in Nepal

Company registration in Nepal is a strategic gateway to South Asia. With the right structure, legal clarity, and compliance planning, foreign companies can scale confidently and profitably.

The key is doing it right the first time.

Ready to Register Your Company in Nepal?

If you are planning to register a company in Nepal, our experts can handle the entire process end-to-end.

Book a free consultation to:

• Assess the best entry structure

• Understand FDI eligibility

• Get a clear timeline and cost roadmap

Frequently Asked Questions (FAQs)

Can foreigners register a company in Nepal?

Yes. Foreign nationals and companies can register a private limited company under FITTA 2019, subject to FDI approval and sector eligibility.

How long does company registration in Nepal take?

Typically 4–6 weeks, including incorporation, FDI approval, and tax registration.

What is the minimum investment for foreign companies?

There is no universal minimum, but sector-specific thresholds may apply under DOI guidelines.

Can profits be repatriated from Nepal?

Yes. Nepal allows full repatriation of profits and capital through Nepal Rastra Bank approval.

Is online company registration in Nepal available?

Partial online filing exists, but foreign companies still require manual approvals and documentation.