Trademark Tips for Nepalese Businesses: A 2026 Perspective

If you are evaluating private vs public company in Nepal, you are already thinking like a serious investor. Structure comes first. Everything else follows.

For foreign companies entering Nepal in 2026, the choice between a private limited company and a public limited company determines control, compliance, fundraising ability, and even brand strategy. It also shapes how you protect intellectual property under Nepal’s trademark framework.

This guide breaks it down clearly. No jargon. No guesswork. Just what you need to know to expand safely and confidently.

Why “Private vs Public Company in Nepal” Is a Strategic Decision, Not Just a Legal Form

When foreign investors compare a private vs public company in Nepal, they often focus only on share capital or shareholder numbers.

That is a mistake.

The structure determines:

• Governance obligations
• Disclosure requirements
• Capital-raising flexibility
• IPO eligibility
• Regulatory scrutiny
• Long-term exit strategy

Under the Companies Act 2006, Nepal recognizes primarily:

• Private Limited Company (Pvt. Ltd.)
• Public Limited Company (Ltd.)

Foreign Direct Investment (FDI) structures are governed alongside the Foreign Investment and Technology Transfer Act 2019 (FITTA).

Understanding how these interact is essential for foreign promoters.

Legal Definition: Private vs Public Company in Nepal

Private Limited Company (Pvt. Ltd.)

A private company in Nepal:

• Limits shareholders (maximum 101)
• Restricts share transfers
• Cannot invite the public to subscribe shares
• Is ideal for closely held businesses

Minimum shareholders: 1
Minimum directors: 1

This structure is most common for foreign subsidiaries.

Public Limited Company (Ltd.)

A public company in Nepal:

• Has at least 7 shareholders
• Has at least 3 directors
• Can invite public subscription
• May list on Nepal Stock Exchange

Public companies face stricter reporting obligations.

They are suitable for large-scale capital-intensive operations.

Quick Comparison Table: Private vs Public Company in Nepal

Insight:
For 90% of foreign investors entering Nepal, a private limited company is more efficient. Public companies are strategic only if IPO or large-scale public capital is required.

How Structure Impacts Trademark Strategy in Nepal

Here is where many investors overlook risk.

Trademark registration in Nepal is governed by the Patent, Design and Trademark Act 1965.

The applicant must be the correct legal entity.

If you restructure later from private to public, ownership must be formally assigned.

Key Trademark Tips for 2026

1. Register the trademark under the operating company, not an individual.
2. Ensure name reservation aligns with trademark search.
3. Conduct prior clearance search before incorporation.
4. File both English and Nepali transliteration.
5. Protect logo and wordmark separately.

Registration Process: Private vs Public Company in Nepal

Step-by-Step Incorporation Process

1. Name reservation with the Office of Company Registrar (OCR).
2. Draft Memorandum and Articles of Association.
3. File incorporation documents.
4. Obtain PAN registration under the Income Tax Act 2002.
5. Register for VAT (if applicable).
6. Apply for FDI approval (if foreign-owned).

Public companies must additionally:

• Issue prospectus
• Comply with securities regulations
• Appoint company secretary

Compliance Differences: What Foreign Investors Must Know

Private Company Compliance

• Annual general meeting
• Annual return filing
• Financial statement submission
• Tax compliance

Public Company Compliance

• Mandatory board committees
• Quarterly disclosures
• Public reporting
• Securities compliance

Public companies are heavily scrutinized.

Private companies offer operational flexibility.

Tax Implications in 2026

Corporate tax is governed by the Income Tax Act 2002.

Standard corporate tax rate: 25%
Banking & special sectors may vary.

The choice between private vs public company does not change the base corporate tax rate.

However:

• Public companies may attract investor-related taxation complexity.
• Dividend distribution may involve broader reporting.

When Should a Foreign Company Choose a Public Company?

A public company makes sense if:

• You plan to raise capital domestically.
• You want to list on Nepal Stock Exchange.
• You are in banking, hydropower, insurance, or large infrastructure.
• Your project requires mass public participation.

Otherwise, a private limited structure is usually more efficient.

Risk Matrix: Control vs Capital vs Compliance

Strategic takeaway:
Choose private for control and agility.
Choose public for scale and capital access.

Common Mistakes Foreign Investors Make

• Registering trademark before finalizing company structure.
• Using nominee shareholders without clear governance.
• Ignoring FITTA approval requirements.
• Underestimating reporting obligations of public companies.
• Not planning exit strategy at incorporation stage.

Structure determines long-term flexibility.

Trademark Filing Checklist for 2026

Before filing:

• Conduct trademark search.
• Confirm company name availability.
• Prepare power of attorney.
• Identify correct class under Nice Classification.
• Ensure consistency with company registration.

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Private vs public company in Nepal structure and trademark filing comparison chart

Frequently Asked Questions (People Also Ask)

1. What is the main difference between a private and public company in Nepal?

A private company limits shareholders and cannot invite public investment. A public company can raise funds from the public and list on NEPSE.

2. Can a foreign investor own 100% of a private company in Nepal?

Yes, subject to sector restrictions under FITTA 2019 and regulatory approval.

3. Is a public company mandatory for large projects?

Not always. Only capital-intensive projects requiring public investment typically need a public structure.

4. How long does company registration take in Nepal?

Typically 5–10 working days if documentation is complete.

5. Should trademarks be registered before incorporation?

It is safer to finalize company structure first, then register the trademark under the company name.

Final Thoughts: Private vs Public Company in Nepal - Choose with Strategy

The decision between private vs public company in Nepal is not administrative. It is strategic.

It affects:

• Control
• Compliance
• Capital access
• Brand protection
• Exit strategy

For most foreign companies entering Nepal in 2026, a private limited company provides flexibility and control.

If your long-term vision includes public fundraising or IPO, then a public structure may be justified.

The key is alignment between structure, trademark ownership, tax planning, and growth strategy.

Ready to Enter Nepal the Right Way?

If you are evaluating private vs public company in Nepal and need structured guidance on:

• FDI approval
• Incorporation
• Trademark registration
• Compliance mapping
• Tax structuring

Speak with our advisory team.

We help foreign investors enter Nepal with clarity, compliance, and confidence.