Step by Step Guide to Applying for a Company Name in Nepal

If you are a foreign company entering Nepal, Private vs public company in Nepal is one of the first strategic decisions you must make. It affects ownership limits, capital requirements, fundraising options, compliance burden, and even how your company name is approved.

This step-by-step guide explains how company name application works in Nepal, while clearly comparing private and public companies from a foreign investor’s perspective. By the end, you will know which structure fits your expansion goals and how to secure your company name correctly the first time.

Understanding the Legal Context in Nepal

Company registration and name approval in Nepal are governed by the Office of the Company Registrar under the Companies Act 2006.

Foreign investors must align name applications with:

• Permitted business activities

• Ownership structure

• Capital thresholds

• Regulatory clarity for authorities

Choosing between a private and public company directly influences how your proposed name is evaluated.

Private vs Public Company in Nepal: The Core Differences

What Is a Private Company in Nepal?

A private company in Nepal is designed for closely held ownership. It is the most common structure for foreign subsidiaries, joint ventures, and back-office operations.

Key characteristics:

• Minimum 1 shareholder, maximum 101

• No public share issuance

• Lower compliance burden

• Faster approval timelines

What Is a Public Company in Nepal?

A public company is structured for capital markets and large-scale investment.

Key characteristics:

• Minimum 7 shareholders

• Mandatory higher paid-up capital

• Can issue shares to the public

• Heavier regulatory oversight

Comparison Table: Private vs Public Company in Nepal

Insight:
For foreign companies, over 90 percent of new incorporations choose the private company route due to flexibility and control.

Why Company Name Matters for Foreign Companies

Your company name is not just branding. In Nepal, it signals:

• Legal structure (private or public)

• Sector classification

• Foreign ownership transparency

• Regulatory intent

Name rejection often happens when foreign applicants underestimate these signals.

Step-by-Step Guide to Applying for a Company Name in Nepal

Step 1: Decide the Company Type First

Before applying for a name, confirm whether you are forming a private or public company. Authorities cross-check name intent with structure.

If your name implies scale, finance, or public investment but you apply as a private company, rejection risk increases.

Step 2: Conduct a Name Availability Search

The Office of the Company Registrar maintains a centralized database of registered and reserved names.

Your proposed name must:

• Be unique

• Not resemble existing names

• Avoid restricted or regulated words

Step 3: Align the Name with Business Objectives

Foreign companies often fail here.

Your name should reflect:

• Actual business activities

• Industry classification

• Long-term expansion plans

For example:

• “Global Holdings Nepal Pvt. Ltd.” raises scrutiny if no holding activity exists.

• “Technology Solutions Nepal Pvt. Ltd.” aligns well with IT services.

Step 4: Prepare Name Reservation Application

The application includes:

• Proposed company name (in English or Nepali)

• Company type (private or public)

• Brief description of activities

This step is procedural but must be precise.

Step 5: Submit Online to OCR

Name applications are submitted electronically to the Office of the Company Registrar.

Processing time:

• Private company: usually 1–3 working days

• Public company: may take longer due to enhanced review

Step 6: Respond to Queries or Objections

Authorities may request clarification if:

• The name implies regulated sectors

• Foreign ownership is unclear

• Public-company terminology is used improperly

Prompt, structured responses improve approval speed.

Common Reasons for Name Rejection in Nepal

Foreign applicants frequently face rejection due to:

• Misuse of “Group,” “International,” or “Global”

• Name not matching stated activities

• Similarity with existing companies

• Public-company wording for private entities

Avoid these by planning structure first.

Private vs Public Company in Nepal: Which Is Better for Foreign Investors?

Private Company Is Ideal If You Want:

• Full operational control

• Faster setup

• Lower compliance cost

• Internal funding

Public Company Is Suitable If You Need:

• Public capital raising

• Large-scale national projects

• Regulatory credibility at scale

For most foreign entrants, private companies offer speed, certainty, and flexibility.

Regulatory and Compliance Considerations

Under the Companies Act 2006, name approval is tied to:

• Memorandum of Association

• Capital structure

• Shareholding pattern

Public companies face additional scrutiny under securities and disclosure laws.

Practical Tips for Foreign Companies

Numbered best-practice checklist:

1. Finalize ownership and capital strategy first

2. Choose private company unless public funding is required

3. Avoid regulated words unless licensed

4. Keep the name aligned with actual operations

5. Prepare alternative names as backups

Key Advantages of Getting Name Approval Right

Bulleted benefits:

• Faster incorporation

• Clean regulatory record

• Easier bank account opening

• Stronger investor confidence

• Reduced compliance friction

Conclusion

Choosing between a private vs public company in Nepal is not just a legal formality. It directly affects how your company name is evaluated, approved, and trusted by regulators.

For most foreign companies, a private company structure combined with a strategically aligned name delivers speed, control, and long-term flexibility. When done correctly, name approval becomes a smooth gateway into Nepal’s growing market rather than a regulatory obstacle.

Frequently Asked Questions 

Is company name approval mandatory in Nepal?

Yes. All companies must obtain name approval from the Office of the Company Registrar before incorporation.

Can foreign companies apply for a public company in Nepal?

Yes, but public companies face higher capital and compliance requirements and are less common for foreign entrants.

How long does name reservation take in Nepal?

Typically 1–3 working days for private companies, longer for public companies if scrutiny increases.

Can I change my company name later?

Yes, but it requires regulatory approval and amendment filings, increasing cost and time.

Does company name affect FDI approval?

Indirectly yes. A misleading name can delay foreign investment approvals.