If you are evaluating private vs public company in Nepal, you are already thinking strategically.
Your company structure affects ownership, fundraising, compliance, taxation, and even trademark protection.
Foreign investors often focus on registration speed. But the smarter question is this:
Which structure protects your capital and brand in the long run?
In this 2026 guide, we break down:
This is not a generic overview.
It is a board-level decision guide.
Under the Companies Act 2006, companies are broadly categorized as:
Both structures can operate in Nepal.
But they serve different strategic purposes.
Your choice affects:
And importantly — how your intellectual property is held and protected.
Nepal’s corporate structure is governed primarily by:
Foreign investors must also comply with approvals from the Department of Industry (DOI) or Investment Board Nepal, depending on project size.
A Private Limited Company is the most common structure for foreign direct investment.
For startups, subsidiaries, back-office operations, and service centers, this structure is usually optimal.
A Public Limited Company is designed for larger ventures.
Public companies are regulated more strictly.
They may eventually list on the Nepal Stock Exchange.
This structure is typically used for:
| Feature | Private Company | Public Company |
|---|---|---|
| Minimum Shareholders | 1 | 7 |
| Maximum Shareholders | 101 | Unlimited |
| Public Share Offering | Not Allowed | Allowed |
| Share Transfer | Restricted | Freely transferable |
| Compliance Burden | Moderate | High |
| IPO Eligibility | No | Yes |
| Governance Structure | Flexible | Structured & regulated |
| Suitable For | FDI subsidiaries, SMEs | Large-scale capital ventures |
Strategic Insight:
90% of foreign companies entering Nepal begin with a private company structure. Public conversion may happen later.
Many foreign investors overlook this.
Trademark ownership must align with your corporate structure.
Nepal’s intellectual property regime is governed by the Patent, Design and Trademark Act 1965.
If you register your trademark under the wrong entity:
This becomes especially important for:
Under the Income Tax Act 2002:
Public companies do not automatically receive tax advantages.
However, sector-specific incentives under the Industrial Enterprises Act 2020 may apply.
Both company types must maintain:
Public companies face additional reporting requirements.
Failure to comply may result in penalties or restrictions on capital repatriation.
Choose a private company if:
This is ideal for:
Choose a public company if:
Avoid these early errors.
They are expensive to correct.
Public company formation follows a similar process but with higher capital and compliance thresholds.
Under the Patent, Design and Trademark Act 1965:
Trademark protection is valid for 7 years and renewable.
Image Alt Text Example (SEO optimized):
alt="Private vs public company in Nepal trademark registration process chart"
Private company incorporation is generally more cost-efficient.
Public company costs increase due to:
For most foreign SMEs, private structure provides better ROI.
Foreign investors should design:
Your entry structure determines your future flexibility.
If you are debating private vs public company in Nepal, the answer for most foreign companies is clear:
Start private.
Scale smart.
Convert later if capital markets demand it.
Align your trademark, tax, and governance framework from day one.
Yes, subject to sectoral approval under FITTA 2019. Certain sectors remain restricted.
Private companies generally have no high statutory minimum, but sectoral thresholds may apply.
Yes. Conversion is possible by amending structure and meeting regulatory requirements.
Both can hold trademarks, but ownership structure must align with tax and licensing strategy.
Corporate tax rates are generally the same. Incentives depend on industry, not structure.
Choosing between private vs public company in Nepal is not just a registration decision.
It is a strategic architecture decision.
For most foreign investors, a private company offers control, flexibility, and efficient trademark management.
Public structures make sense when large-scale capital raising becomes essential.
If you are planning entry into Nepal in 2026, consult experienced advisors who understand corporate law, tax, and IP integration.