What's New in 2026: Updates in the Company Registration Process in Nepal

Private vs public company in Nepal is one of the first strategic decisions foreign investors must make. In 2026, Nepal has refined its company registration process to improve transparency, digitisation, and foreign investment facilitation. These updates affect ownership limits, compliance depth, timelines, and capital-raising options. If you are expanding into Nepal, this guide explains what changed in 2026 and how to choose the right structure with confidence.

What Changed in 2026 for Company Registration in Nepal

Nepal’s reforms aim to reduce friction for legitimate investors while tightening governance. The most relevant updates for foreign companies include:

Key 2026 Regulatory Updates

1. Enhanced digital filings at the Office of Company Registrar (OCR)

2. Stricter beneficial ownership disclosures aligned with AML standards

3. Clearer thresholds for private vs public classification

4. Streamlined FDI approval sequencing with company incorporation

5. Improved post-registration compliance monitoring

These changes make the private vs public company in Nepal decision more consequential than before.

Understanding Private and Public Companies in Nepal

Before comparing updates, let’s ground the basics.

What Is a Private Company in Nepal

A private company in Nepal:

• Has 1–101 shareholders

• Restricts share transfers

• Cannot invite the public to subscribe to shares

• Is preferred for FDI, subsidiaries, and controlled expansions

What Is a Public Company in Nepal

A public company in Nepal:

• Requires minimum 7 shareholders

• Has no maximum shareholders

• May raise capital from the public (subject to approvals)

• Is suited for large infrastructure, banking, and capital-intensive projects

Private vs Public Company in Nepal: 2026 Comparison Table

Insight: In 2026, regulators are actively nudging foreign investors toward private companies unless public fundraising is essential.

2026 Registration Process: Step-by-Step

Private Company Registration (Updated Flow)

1. Name reservation via OCR portal

2. FDI approval (if foreign owned)

3. Charter documents filing (MOA/AOA)

4. Company registration certificate issuance

5. Tax and local registrations

Public Company Registration (Updated Flow)

1. Name reservation and feasibility disclosure

2. Promoter agreements and minimum capital confirmation

3. OCR registration with enhanced scrutiny

4. Sector regulator clearance (if applicable)

5. Public issuance approvals (if raising funds)

Compliance Changes in 2026 You Must Know

Beneficial Ownership Disclosure

All companies must now:

• Declare ultimate beneficial owners

• Update OCR within 35 days of change

• Maintain internal ownership registers

This is a major 2026 update impacting private vs public company in Nepal compliance planning.

Annual Filing Enhancements

Companies must submit:

• Annual returns with director confirmations

• Audited financials (mandatory for public companies)

• Tax clearance references

Tax and Financial Implications (2026)

Corporate Tax Snapshot

• Standard corporate tax: 25%

• Certain industries: 20% or concessional rates

• Withholding taxes tightened on cross-border payments

Capital Repatriation

Private companies remain the simplest vehicle for dividend and capital repatriation, subject to central bank approvals.

Why Foreign Companies Prefer Private Companies in 2026

Foreign investors overwhelmingly choose private companies due to:

• Faster setup

• Lower disclosure exposure

• Easier exits

• Fewer governance layers

Typical Use Cases

• Regional headquarters

• Outsourced operations

• IT, BPO, consulting, engineering teams

• Joint ventures with local partners

When a Public Company Still Makes Sense

Despite complexity, public companies are ideal when:

• You need large-scale capital

• You plan an IPO or debenture issue

• Regulators mandate public structure (banks, insurers)

Common Mistakes Foreign Investors Make

• Choosing public company “for credibility” without need

• Underestimating compliance costs

• Ignoring sectoral FDI caps

• Poor shareholder structuring

Avoiding these mistakes starts with understanding private vs public company in Nepal under the 2026 rules.

Documents Required in 2026 (Updated)

Private Company

• Passport and KYC of shareholders

• FDI approval letter

• MOA and AOA

• Registered office proof

Public Company

• Promoter agreements

• Capital commitment evidence

• Enhanced disclosures

• Sector regulator NOCs

Timeline Expectations (Realistic 2026 View)

• Private company with FDI: 3–6 weeks end-to-end

• Public company: 2–4 months (longer if regulated sector)

FAQ: People Also Ask (2026)

Is private or public company better for foreign investors in Nepal

Private companies are better for most foreign investors due to faster registration, lower compliance, and easier profit repatriation.

Can a foreigner own 100% of a Nepalese company

Yes. 100% foreign ownership is allowed in many sectors, subject to FDI approval.

Has company registration become faster in 2026

Yes. Digitization and clearer approval sequencing have reduced delays, especially for private companies.

Can a private company convert to a public company later

Yes. Conversion is permitted with regulatory approval and compliance upgrades.

What is the biggest 2026 compliance change

Mandatory beneficial ownership disclosure and stricter annual filings are the most significant updates.

Conclusion

The private vs public company in Nepal decision in 2026 is clearer than ever. Regulatory updates favor well-structured, compliant private companies for foreign investors, while public companies remain tools for large-scale capital mobilization. Choosing the right structure at entry saves time, cost, and regulatory friction later.