The Company Act, 2063

Registration of a Company in Nepal:

Anyone willing to start a business in Nepal is required to register their company in the Office of Company Registrar i.e. the OCR which is located at Tripureshwor, Kathmandu by following the guidelines and submitting the required documents. The Company’s Act 2063(the “Companies Act”) provides the necessary guidelines and regulations for the registration of a company.

What are the types of Companies that can be registered in Nepal and what is the required minimum capital for each?

1. Public Company (Minimum capital 1,00,00,000)
2. Private Company (Minimum capital 1,00,000)
3.  Non-Profit oriented company

What are the necessary documents to be prepared for the registration?

• Application for registration
• Memorandum of association (MOA) and articles of association (AOA) of the proposed company one original each.
• Citizenship certificate in case of Nepalese promoter / passport in case of foreign promoter.
• Shareholder’s agreement ( if any)   
• Copy of certificate of registration and other registration documents (memorandum of association, articles of association) if the shareholder is a company.  
• Corporate resolution of the shareholder if the shareholder is a company.
• Copy of prior approval of the DOI in case the shareholder is a foreign investor.

What is the procedure for the registration of a company?

Anyone who wants to incorporate a company must submit an application (Section 4) to the OCR along with the MOA, AOA, Pre-incorporation Contract, and Consensus Agreement in the format and with the specified fees. The following Steps should be followed for the registration of a company.

How long does the registration process take?

Total time required for registration of a new company is 7 to 14 days.

Reservation of the name in the online portal of OCR

Initially the registration process includes reservation and approval of the company’s name from the online portal of OCR.

1. Firstly, send the name of the company to the website of the OCR www.ocr.gov.np  to check whether the name of the company is already in use or not. You have to follow these processes:
2. Click to the above-mentioned link in the homepage of the OCR. You will find various links such as;
   – To establish a new Company, please click here New !– To get username and password for already registered company, please click here
3. Here you keep your name and email address. Account Make account and USER NAME will be your username PASSWORD comes in your email account.
4. Now keep email in Username and keep PASSWORD in email and login, in the next step, click to CHECK COMPANY NAME.
5. Here comes the NAME RESERVATION REQUEST FORM to keep the company name, and objectives. After the submission the OCR might approve or reject the application request, which will be notified within 7-14 working days.
6. If your request is not approved you will receive a rejection message from the OCR. Even after the rejection you can still request for approval with a different name or with the necessary corrections from the same login info.
7. After the approval of the name, scanned documents such as; letter with the signatures of the owner/founder/ partners, citizenship should be uploaded to the OCR website in a Pdf. file.
8. After uploading all documents, OCR will send a verification email.

Registration from the OCR and certification

After the successful reservation of name from the OCR you must visit the OCR office and follow the following steps: 

1. Submit  physical copy of documents at OCR
2. The OCR will examine the submitted documents
3. If everything looks fine then the OCR will issue company registration certificate
4. After showing the receipt, the registration process will be finished and you will be provided with the registration certificate consisting stamp and signature of related staff and officers.

Tax Registration (VAT/PAN) at the Inland Revenue Office: 

After the successful registration of the company you will need to obtain a PAN or VAT Registration certificate from the Inland Revenue Department prior to the commencement of its business depending on the value of the annual transaction of the business.

PAN Registration

Before starting a business in Nepal, all entities must obtain a Permanent Account Number (PAN) registration certificate from the Inland Revenue Department. PAN is a unique identification number issued to all Nepalese taxpayers. This includes private companies, partnership firms, companies, and all other types of local businesses.

Documents required:

• Copy of citizenship certificate;
• Copy of company registration certificate;
• Two identical passport size photos of the person who signs the application form. In case of partnership firms, two identical size photos of each partner;
• Sketched map of the location of the main office;
• Rental agreement including proof of payment of rental tax at local level authority; 
• Application documents requiring the company’s seal;
• Individual Permanent Account Number of Director or Shareholder whose photograph will be used in the tax registration certificate. 

Value Added Tax (VAT) Registration 

Any entity involved in taxable transactions under Value Added Tax Act, 2052 (1996) must submit an application before the Inland Revenue Office for Vat registration. 

VAT registration is incorporated into the PAN certificate. The Inland Revenue Office provides it. Businesses that have transactions in excess of 20 lakh (Two Hundred Thousand) Nepali Rupees for services and 50 lakh (Five Hundred Thousand) Nepali Rupees for goods must register for VAT.

Is it necessary to acquire additional licenses or permission to operate businesses after the registration?

Certain regulated businesses, such as banks and financial institutions, hydropower, travel and trekking companies, hospitals, airlines, and medical industries, must obtain additional approvals or licenses before they can begin operations.