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.
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.
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
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
| Criteria | Private Company | Public Company |
|---|---|---|
| Minimum shareholders | 1 | 7 |
| Maximum shareholders | 101 | Unlimited |
| Public share issuance | Not allowed | Allowed |
| Typical foreign use case | Subsidiary, branch alternative, JV | Large infrastructure, banking, listed firms |
| Compliance intensity | Moderate | High |
| Name approval scrutiny | Standard | Strict |
Insight:
For foreign companies, over 90 percent of new incorporations choose the private company route due to flexibility and control.
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.
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.
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
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.
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.
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
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.
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.
Full operational control
Faster setup
Lower compliance cost
Internal funding
Public capital raising
Large-scale national projects
Regulatory credibility at scale
For most foreign entrants, private companies offer speed, certainty, and flexibility.
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.
Numbered best-practice checklist:
Finalize ownership and capital strategy first
Choose private company unless public funding is required
Avoid regulated words unless licensed
Keep the name aligned with actual operations
Prepare alternative names as backups
Bulleted benefits:
Faster incorporation
Clean regulatory record
Easier bank account opening
Stronger investor confidence
Reduced compliance friction
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.
Yes. All companies must obtain name approval from the Office of the Company Registrar before incorporation.
Yes, but public companies face higher capital and compliance requirements and are less common for foreign entrants.
Typically 1–3 working days for private companies, longer for public companies if scrutiny increases.
Yes, but it requires regulatory approval and amendment filings, increasing cost and time.
Indirectly yes. A misleading name can delay foreign investment approvals.