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.
Nepal’s reforms aim to reduce friction for legitimate investors while tightening governance. The most relevant updates for foreign companies include:
Enhanced digital filings at the Office of Company Registrar (OCR)
Stricter beneficial ownership disclosures aligned with AML standards
Clearer thresholds for private vs public classification
Streamlined FDI approval sequencing with company incorporation
Improved post-registration compliance monitoring
These changes make the private vs public company in Nepal decision more consequential than before.
Before comparing updates, let’s ground the basics.
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
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
| Factor | Private Company (2026) | Public Company (2026) |
|---|---|---|
| Shareholders | 1–101 | Minimum 7, unlimited |
| Foreign ownership | Up to 100% (sector-dependent) | Allowed, higher scrutiny |
| Capital raising | Private funding only | Public + private |
| Compliance burden | Moderate | High |
| Time to register | 7–14 working days | 25–45 working days |
| Governance | Board + basic filings | Board, committees, audits |
| Best for | Foreign subsidiaries, SMEs | Large projects, IPO-ready firms |
Insight: In 2026, regulators are actively nudging foreign investors toward private companies unless public fundraising is essential.
Name reservation via OCR portal
FDI approval (if foreign owned)
Charter documents filing (MOA/AOA)
Company registration certificate issuance
Tax and local registrations
Name reservation and feasibility disclosure
Promoter agreements and minimum capital confirmation
OCR registration with enhanced scrutiny
Sector regulator clearance (if applicable)
Public issuance approvals (if raising funds)
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.
Companies must submit:
Annual returns with director confirmations
Audited financials (mandatory for public companies)
Tax clearance references
Standard corporate tax: 25%
Certain industries: 20% or concessional rates
Withholding taxes tightened on cross-border payments
Private companies remain the simplest vehicle for dividend and capital repatriation, subject to central bank approvals.
Foreign investors overwhelmingly choose private companies due to:
Faster setup
Lower disclosure exposure
Easier exits
Fewer governance layers
Regional headquarters
Outsourced operations
IT, BPO, consulting, engineering teams
Joint ventures with local partners
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)
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.
Passport and KYC of shareholders
FDI approval letter
MOA and AOA
Registered office proof
Promoter agreements
Capital commitment evidence
Enhanced disclosures
Sector regulator NOCs
Private company with FDI: 3–6 weeks end-to-end
Public company: 2–4 months (longer if regulated sector)
Private companies are better for most foreign investors due to faster registration, lower compliance, and easier profit repatriation.
Yes. 100% foreign ownership is allowed in many sectors, subject to FDI approval.
Yes. Digitization and clearer approval sequencing have reduced delays, especially for private companies.
Yes. Conversion is permitted with regulatory approval and compliance upgrades.
Mandatory beneficial ownership disclosure and stricter annual filings are the most significant updates.
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.