If you are a foreign company exploring South Asia, private vs public company in Nepal is one of the first and most important decisions you will face.
This choice determines how much capital you can raise, how visible your business becomes, and how much regulatory oversight you accept. It also affects timelines, compliance costs, and long-term exit options.
At the center of this decision sits the Office of the Company Registrar (OCR). OCR is the authority that governs company registration, structure, and ongoing compliance in Nepal.
This guide explains private and public companies in Nepal through a foreign-investor lens. It also demystifies OCR’s role, so you can choose the right structure with confidence.
The Office of the Company Registrar is the legal gateway for all incorporated businesses in Nepal. No company exists according to the law without OCR approval.
OCR operates under the Companies Act 2006 and performs several critical functions:
Incorporates private and public companies
Reviews constitutional documents
Maintains public company records
Oversees compliance and filings
Approves changes in capital, directors, and shareholders
For foreign companies, OCR also works alongside foreign investment regulators when FDI is involved.
A private company is the most common structure used by foreign investors entering Nepal.
Under Nepalese law, a private company:
Limits shareholders to a maximum of 101
Restricts share transfers
Prohibits public share offerings
This structure prioritizes control, speed, and confidentiality.
Most foreign investors choose a private company because it offers:
Faster registration with OCR
Lower compliance burden
Full control over ownership
Greater operational privacy
Private companies are ideal for subsidiaries, joint ventures, and controlled operating entities.
A public company is designed for scale, capital markets, and broad ownership.
A public company in Nepal:
Has no maximum shareholder limit
Can issue shares to the public
Must meet higher capital thresholds
Faces strict disclosure requirements
Public companies are closely monitored by OCR and capital market regulators.
Public companies are usually suitable when:
Large capital raises are required
Public trust and visibility are strategic
Listing on Nepal’s stock exchange is planned
For most foreign entrants, this is a later-stage structure rather than a starting point.
Below is a practical comparison foreign companies should evaluate.
| Criteria | Private Company | Public Company |
|---|---|---|
| Minimum shareholders | 1 | 7 |
| Maximum shareholders | 101 | Unlimited |
| Public share offering | Not allowed | Allowed |
| Regulatory scrutiny | Moderate | High |
| Disclosure requirements | Limited | Extensive |
| Typical use case | Subsidiary, JV, operations | Capital markets, large enterprises |
This distinction is enforced and monitored by OCR from incorporation onward.
Regardless of structure, OCR follows a defined registration process.
Name reservation and approval
Submission of constitutional documents
Director and shareholder disclosures
Capital structure verification
Issuance of incorporation certificate
Public companies face additional scrutiny at steps three and four.
Capitalization is one of OCR’s primary review points.
Private companies enjoy flexibility. OCR does not impose a high statutory minimum. Capital is assessed based on business activity.
Public companies must meet higher minimum capital thresholds. OCR carefully reviews capital adequacy, especially for public offerings.
This difference alone often pushes foreign investors toward private companies.
Private companies must:
File annual returns
Notify OCR of director changes
Maintain statutory registers
Compliance is predictable and manageable.
Public companies must also:
Publish audited financials
Disclose material changes publicly
Obtain OCR approval for many actions
The compliance cost is significantly higher.
Private companies restrict share transfers. OCR enforces these restrictions strictly.
This allows foreign shareholders to maintain control without dilution.
Public companies allow free transferability of shares. OCR ensures transparency but control can dilute quickly.
For most foreign companies entering Nepal, private companies offer the best balance.
Nepal is a cost center or delivery hub
IP and decision-making remain offshore
Growth is controlled, not speculative
Nepal is a primary market
Local capital markets are central to growth
Brand visibility is strategically critical
OCR coordinates with foreign investment authorities when foreign shareholding is involved.
Key points foreign companies should know:
OCR does not approve FDI alone
Corporate structure must align with FDI approvals
Post-approval changes still require OCR filings
This coordination is smoother with private companies.
Choosing the wrong structure can create long-term friction.
Common mistakes include:
Registering a public company too early
Underestimating compliance costs
Losing control through share dilution
Slower regulatory approvals
OCR enforces the structure you choose. Reversing it later is complex.
For foreign companies, private vs public company in Nepal is not a theoretical choice. It is a strategic decision that affects cost, risk, and control.
Most foreign investors start with a private company, validate the market, and scale later if needed. OCR’s framework supports this phased approach.
For most foreign companies, yes. Private companies offer lower compliance, faster OCR approvals, and stronger ownership control.
Yes, subject to foreign investment approval. OCR allows full foreign ownership where permitted by law.
Private company registration usually takes one to two weeks. Public companies take longer due to additional scrutiny.
Yes. OCR allows conversion, but the process is detailed and compliance-heavy.
No. OCR focuses on incorporation, structure, and statutory compliance, not daily operations.
Understanding private vs public company in Nepal means understanding OCR’s role, expectations, and enforcement power.
For foreign companies, private companies offer speed, control, and regulatory clarity. Public companies offer scale but demand readiness.
The correct choice aligns your Nepal strategy with OCR realities from day one.