Foreign investors comparing a private vs public company in Nepal usually ask one practical question first: what papers do we actually need?
This guide answers that clearly. It walks you through document requirements for Nepalese private company registration, contrasts them with public companies, and explains why most foreign companies start private. You will also see legal references, regulator expectations, and common mistakes that delay approvals.
If you want a compliant, fast, and scalable Nepal entry, this article is your roadmap.
Before preparing documents, you need clarity on structure.
A private company in Nepal is designed for closely held ownership. Shares are not offered to the public. Governance is simpler. Compliance is lighter.
A public company can issue shares to the public and list on the stock exchange. It faces higher capital, disclosure, and regulatory thresholds.
For most foreign companies entering Nepal for back-office operations, IT services, BPO, or trading, the private company structure is the default choice.
Company incorporation in Nepal is governed primarily by the Companies Act 2006. Foreign investment elements are regulated through FITTA and sector-specific laws.
The registering authority is the Office of Company Registrar, commonly called OCR.
Key regulators involved:
When comparing private vs public company in Nepal, foreign investors almost always choose private because:
A public company is rarely justified unless you plan capital markets activity inside Nepal.
This is the heart of the process. Below is the complete document checklist foreign companies should prepare.
These define the company’s legal existence.
Both must comply with the Companies Act 2006 and OCR formats.
For each foreign shareholder or director:
If the shareholder is a foreign company, additional documents apply.
If shares are held by an overseas entity:
These documents must be:
OCR requires proof of a physical address.
Accepted documents include:
Virtual offices are not accepted.
You must submit:
For foreign investment, capital inflow must later be routed through banking channels.
Mandatory resolutions include:
Foreign shareholders usually issue a Power of Attorney authorizing a local representative to complete registration.
This must be:
| Area | Private Company | Public Company |
|---|---|---|
| Minimum shareholders | 1 to 101 | Minimum 7 |
| Minimum capital | No statutory minimum | NPR 10 million |
| Prospectus | Not required | Mandatory |
| Public disclosure | Limited | Extensive |
| Regulatory approvals | OCR, DOI | OCR, SEBON, DOI |
| Time to register | Faster | Significantly longer |
| Best for foreign firms | Yes | Rarely |
This table alone explains why private vs public company in Nepal decisions usually favor private entities.
Registration is not the end. Foreign companies must complete post-incorporation compliance.
Missing these steps creates downstream repatriation and audit risks.
Foreign companies often face delays due to:
These are avoidable with proper preparation.
Typical timeline:
Public company registration can take several months.
From a tax standpoint, private and public companies are treated similarly under the Income Tax Act. The difference lies in reporting burden, not tax rates.
This is another reason the private vs public company in Nepal decision is operational rather than fiscal.
A public company may be suitable if:
For most foreign service companies, it adds cost without benefit.
Understanding private vs public company in Nepal is less about theory and more about execution. A private company offers speed, control, and compliance clarity.
Prepare the right documents early. Align them with regulator expectations. Avoid rework.
That is how successful foreign companies enter Nepal.
No, but most foreign investors choose private companies due to lower capital and simpler compliance.
There is no fixed minimum under the Companies Act, but sectoral rules may apply.
Yes. Foreign nationals can be directors, subject to visa and compliance requirements.
Typically 2 to 4 weeks including document preparation and approvals.
Usually no. Public companies involve higher cost, disclosure, and regulatory oversight.