Types of companies in Nepal is one of the first questions foreign founders, investors, and expansion leaders ask when exploring South Asia. Nepal offers strategic access to India and China, a young English-speaking workforce, and competitive operating costs.
However, choosing the wrong legal structure can delay approvals, restrict foreign ownership, or create long-term compliance risks.
This guide focuses on the top 5 most common types of companies registered in Nepal, explaining why they are popular, who they are best for, and how foreign companies typically use them.
You will also find a comparison table, practical insights, and clear next steps.
Selecting the correct company type in Nepal impacts:
Foreign ownership eligibility
Minimum capital requirements
Tax exposure and profit repatriation
Hiring flexibility
Regulatory approvals
Nepal’s company framework is governed primarily by the Companies Act 2006, supported by foreign investment and labour regulations. Each structure serves a different strategic purpose.
Foreign companies overwhelmingly register under one of the following five structures:
Private Limited Company
Public Limited Company
Branch Office
Liaison (Representative) Office
Non-Profit Company
Let’s explore each in detail.
The Private Limited Company is the most widely used and flexible structure in Nepal. It suits startups, SMEs, outsourcing hubs, and long-term market entry strategies.
Separate legal entity
Limited liability protection
Can be 100 percent foreign-owned (sector-dependent)
Ideal for revenue-generating activities
IT and software development
BPO and outsourcing operations
Consulting and professional services
Trading and manufacturing
Simple governance structure
High credibility with banks and clients
Easy profit repatriation (subject to compliance)
Foreign investment approval required
Ongoing tax and statutory filings
A Public Limited Company is designed for large businesses planning public fundraising or institutional investment.
Minimum seven shareholders
Ability to issue shares publicly
Higher compliance standards
Large infrastructure projects
Banks and financial institutions
Hydropower and energy companies
Easier access to large capital
Strong public credibility
Complex regulatory requirements
Not suitable for small or early-stage foreign firms
A Branch Office allows a foreign company to operate directly in Nepal while remaining legally tied to the parent company.
No separate legal identity
Activities limited to parent company scope
Foreign ownership remains offshore
Engineering and construction projects
International contractors
Government-funded projects
Faster setup than a new company
Full foreign control
Restricted business activities
Parent company bears full liability
A Liaison Office is used for research, coordination, and brand representation only.
Cannot earn revenue in Nepal
Operates as a cost centre
Fully funded by the parent company
Market research
Vendor coordination
Government and partner engagement
Low compliance burden
Simple structure
No commercial activity allowed
Limited staff scope
A Non-Profit Company is formed for social, educational, or charitable objectives.
No dividend distribution
Surpluses reinvested into objectives
Often donor-funded
NGOs and INGOs
Research institutions
Foundations
Eligible for grants and donor funding
Strong public trust
Strict use-of-funds restrictions
Not suitable for commercial goals
| Company Type | Revenue Allowed | Foreign Ownership | Best For | Complexity |
|---|---|---|---|---|
| Private Limited | Yes | Up to 100% | SMEs, startups | Medium |
| Public Limited | Yes | Allowed | Large enterprises | High |
| Branch Office | Yes (limited) | 100% | Project-based work | Medium |
| Liaison Office | No | 100% | Market entry | Low |
| Non-Profit | No (commercial) | Allowed | Social impact | Medium |
Foreign investors usually decide based on:
Planned revenue generation
Hiring needs
Duration of presence
Risk appetite
Quick guidance:
Want to sell services locally? → Private Limited Company
Executing a short-term project? → Branch Office
Testing the market only? → Liaison Office
When selecting from the types of companies in Nepal, foreign companies should prepare for:
Foreign investment approvals
Company registration filings
Tax registration and VAT (if applicable)
Labour law compliance
Annual reporting obligations
Proper structuring at the beginning avoids restructuring costs later.
Parent company incorporation documents
Board resolution approving Nepal entry
Passport copies of directors
Proposed business plan
Capital commitment details
Competitive labour costs
Growing tech and services sector
Strategic regional location
Improving digital registration systems
Most foreign investors choose a Private Limited Company due to flexibility, limited liability, and revenue permissions. It suits long-term operations and hiring.
Yes, foreigners can own 100 percent in many sectors, subject to foreign investment approval and sectoral restrictions.
A branch office suits project-based work. A subsidiary offers better long-term flexibility and liability protection.
Company registration typically takes 2–4 weeks, excluding foreign investment approvals.
Yes, but only for non-commercial activities such as coordination and research.
Understanding the types of companies in Nepal is essential for a smooth and compliant market entry.
Most foreign companies succeed by aligning their legal structure with their commercial goals from day one. Whether you are testing the market or scaling operations, Nepal offers a suitable structure for every stage.
Planning to register a company in Nepal?
Speak with our Nepal incorporation and foreign investment specialists to choose the right structure, avoid delays, and launch confidently.