Are you considering starting a business in Nepal but unsure about the company registration process? Registering your company is a crucial step governed by the Company Act of 2063 B.S. and the Company Directive 2072 B.S. In Nepal, not all businesses require company registration, but those planning to operate under a legal framework or seeking expansion through share issuance must register. This process grants your business legal recognition, perpetual succession, limited liability, and the ability to own property and sue or be sued.

It's important to note that a company in Nepal should be registered when it intends to operate under the legal framework of a registered entity, aiming to expand its objectives, or planning to issue shares. If you're ready to establish your company and need guidance on the registration process in Nepal, this blog will walk you through the necessary steps. Learn more about how to register your company to ensure compliance and legal standing within Nepal's business landscape.

Steps to register a company

Step 1: Reservation of Company name

The first and foremost important step in Registration is to reserve the name of a company on the OCR website. Before accessing the website, it is essential to establish an email using the company's name. Visit this OCR website to create an account and request a reservation of the company name. You will view the following page :

Visit this link " https://application.ocr.gov.np/CRO/resources/Manual/New%20Registration.pdf " to get the user manual to help you create an account. Ensure the name is unique and complies with the name guidelines provided by the OCR. OCR should approve the proposed company's name before continuing the further registration process. OCR will notify you by email whether the reserved name has been approved or not. If OCR did not send you an email you can visit the OCR website and log in using your username and password. After login, you can check whether your company name is approved or not. You can request a new company name again if the company name is rejected.

Here is the list of rules for the reservation of a company name

The Company Name must be in the Title Case.
Example :
Biznest Bazaar : Right
BIZNEST BAZAAR : Wrong
The company Name must be the same in both English and Nepali.
Example :
नेपाल पानी कम्पनी : Wrong
नेपाल वाटर कम्पनी : Right
The Company Name must not include any numbers.
Example:
Plant11 : Wrong
Plant Eleven : Right
The Company Name must not include symbols such as a colon (:), semicolon (;), apostrophe ('), hyphen (-), or comma (,) or pronouns like "my," "our," "your," or similar words.
Example:
Rams Bakery : Right
Ram’s Bakery : Wrong
If a company is related to a school, the district's name must be mentioned after the company name.
Example:
Ganesh Himal Grammar School Kathmandu : Right
Ganesh Himal Grammar School : Wrong
The company name must not include 'A', 'An', 'The', 'New', 'Super', 'Om', 'Nepal', 'International', or 'Shree'.
The company name must not include names from other countries.
Example:
Japan Cafe : Wrong
The company name should be different from an already registered company name.
The company name should reflect the purpose of the business.
Example:
Namaste Dairy : Right (company related to the dairy product)

Also Read : Advantage of Buying a Registered Business in Nepal

Step 2: Preparation of MOA and AOA

After the reservation, you need to prepare for Memorandum of Association (MOA) and Articles of Association (AOA). You can consult or hire a lawyer to draft the MOA and AOA of the company.

MOA (Nepali: प्रबन्धपत्र) is a document containing details of the company. It is a very basic document of the company. It is also known as the charter of the company. MOA contains the name of the company, objectives of the company, address of the registered office of the company, and capital clause, etc. It regulates the relationship of the company with the outsider stakeholders. MOA is needed at the time of incorporation of the company. The memorandum of association should include the names and addresses of its promoters, specify the number or quantity of shares that each promoter has agreed to subscribe to, and must be signed by each of them. The memorandum of association needs to clearly show the names and addresses of a witness for each promoter, and it should also have the signatures of witnesses.

Sample Format of MOA

MOA Private Company with Single Shareholder	Download
MOA Private Company with More than Single Shareholder	Download
MOA Public Company	Download

AOA (Nepali: नियमावली) is another important document needed at the time of incorporation of the company. You are required to Articles of Association to achieve the goals outlined in a memorandum of association and to conduct its operations in an effective manner. It consists of Procedures for convening the general meeting of the company and notices to be given for such meetings, Proceedings of general meetings, Etc.

Sample Format of AOA

AOA Public Company	Download
AOA Profit Non Distributing Company	Download
AOA Private Company with Single Shareholder	Download
AOA Private Company with Multiple Shareholder	Download

Also Read : Legal Process of Selling a Private Business in Nepal

Step 3: Fill out the Company Registration Form

After the approval of the Company Name, you can fill out the company register form in OCR e-service with your username and password. The company registration form requires you to provide the following information:

Address of the Company
Capital Structure
Company Shareholders Details
Upload related documents (including MOA, AOA, Application, and power of Attorney if appointed)

Sample Format of Company Registration Form

Application to Register Company	Download
Application to Register Company of Single Shareholders	Download

Step 4: Submission of Physical Copy of documents at OCR

After submitting the online form, you must approach the OCR and submit the hard copy of MOA/AOA and other necessary documents. The following document should be submitted at OCR:

Application for registration
Copies of Citizenship of founder shareholders
Two Copies of the Article of Association
Two copies of the Memorandum of Association
Copies of the agreement between the founder shareholders
Power of Attorney if appointed

If the owner is another company then require additional documents. They are:

Owning company’s registration certificate
The owning company’s board decision to establish the proposed company
Related documents of the company such as Articles of Association and Memorandum of Association
An appointment letter from the company’s representative in the proposed company
PAN/VAT certificate
Tax Clearance/Company Update Letter

If the company has foreign investor:

Approval of foreign investment from the related authority
If the foreign investor is an individual then a copy of the investor’s passport
If the foreign investor is the company then related documents of the company such as Articles of Association and Memorandum of Association

Along with the document, you need to pay registration fees that depend on the size of the capital investment in the company. Registration fees for both private and public companies are different. In the current fiscal year's (2080-2081) budget, the government of Nepal announced no fees for company registration for companies.

However, the company registration fees for private and public companies differed. Fees Structure are as mentioned below:

Registration fee for Private Companies Registration

Registration fee for Public Companies Registration

Also Read: A Comprehensive Guide to Selling a Private Business In Nepal

Step 5: Examination of Submitted Documents by OCR

After the documents are submitted, OCR examines them. If everything is in order, the company registration will be approved, and OCR will issue a certificate of incorporation. If the Register detects an error in the document, OCR will direct you to rectify or amend the mistake, and after the correction, OCR will issue a certificate of incorporation.

Step 6: Register of Business in Ward

Once you obtain the incorporation certificate, you must register the company at the local level, typically at the ward office. The documents required for the Registration are:

Registration Form- Available at the ward office
Rent Agreement
Citizenship of Shareholder and Land Owner
Land ownership Certificate
Property Tax paid Receipt
Passport- Size photographs of directors/ shareholders
Copies of land owning certificate.
Photo
Company Seal
Memorandum of Association
Article of Association
Certificate of Company Registration
Any additional documents or forms as required by the ward office or regulatory authorities

Also read: Buying a Franchise vs Independent Business

Step 7: Register under PAN at the Inland Revenue Office

Every company is required to obtain a PAN registration certificate from the Inland Revenue Department. You must apply through the IRD website. You can visit this link (https://ird.gov.np/) to visit the IRD website. After you fill the online application you need to visit IRD office you have chosen. The documents required for the PAN Registration Process in Nepal are:

PAN Application Form
Copies of Citizenship
Biometric ( in IRD)
Copy of Memorandum of Association
Copy of Article of Association
PAN Minute
Rent Agreement
Company Seal
Business Registration Certificate of the local level.

For Foreigners, Identification Documents and additional relevant documents will be required.

Additional approval/ license

You need to get additional approvals or licenses from the concerned offices before the commencement of the business.

For Example

Excise Duty Act, 2058 Section 8 mentions that no person, firm, company, or organization are allowed to manufacture, import, sell, or store excisable goods or provide excisable services to any other person, without obtaining a license.

Section 78 of the Nepal Rastra Bank Act, 2058 B.S mentioned that Commercial Banks and financial institutions should obtain a license from the Bank to conduct banking and financial transactions.

For companies related to tour and travel, you can apply for a tour and travel agency license from the Department of Tourism after completing the registration process. This involves submitting an application form and the required legal documents and paying the necessary fees.

If a company is an online media company, you need a license certificate from the Press Council.

Also Read: Franchise Agreement: 15 Essentials You Need to Know

Frequently Asked Question

What are the different types of companies that can be registered in Nepal?

Types of companies that can be registered in Nepal are Private Limited Company, Public Limited Company and Profit not distributing company.

What is the minimum capital requirement for company registration in Nepal?

There is a difference in minimum capital requirement for company registration in Nepal. Therefore, For the Public Limited Company requires Rs 1 crore.

What is the minimum number of shareholders needed to form a company?

The requirement for the number of shareholders varies between private and public companies. A private company cannot have more than 101 shareholders, while a public company must have a minimum of 7 shareholders with no maximum limit.

Can the company name be changed after incorporation?

Yes, you can change the company name after the incorporation if required. A special resolution should be adopted in its General Meeting. A company cannot change its name unless it gets prior approval from the OCR.

What are the key benefits of registering a company in Nepal?

Registering a company in Nepal provides several benefits, including legal recognition, limited liability protection for shareholders, perpetual succession, access to funding through share issuance, and the ability to enter into contracts and own property in the company's name.

How long does the company registration process typically take in Nepal?

The company registration process can vary in duration based on factors such as the completeness of documentation and the workload of the Office of the Company Registrar (OCR). Generally, it may take a few weeks to complete the entire registration process.

Is it necessary to have a physical office space for company registration in Nepal?

Yes, a registered company in Nepal must have a physical office address within the country. This address will be used as the registered office for official correspondence and legal purposes.

What are the ongoing compliance requirements for registered companies in Nepal?

Registered companies in Nepal are required to fulfill various compliance obligations, including filing annual returns, maintaining accounting records, holding annual general meetings (AGMs), and complying with tax and regulatory requirements.

Can foreign nationals or foreign companies register a company in Nepal?

Yes, foreign nationals and foreign companies can register a company in Nepal subject to certain restrictions and approvals. Foreign investment in specific sectors may require additional approvals from relevant government authorities.

What is the role of shareholders and directors in a registered company in Nepal?

Shareholders are the owners of the company who invest capital and share in its profits. Directors are appointed to manage the company's affairs and make strategic decisions on behalf of the shareholders. Shareholders and directors have specific rights and responsibilities outlined in the company's Memorandum and Articles of Association.

How can I check the status of my company registration application in Nepal?

You can track the status of your company registration application through the OCR's online portal using your registered account credentials. Updates and notifications regarding the approval process will be communicated via email or through the online platform.

What happens if there are errors or discrepancies in the registration documents?

If errors or discrepancies are identified in the registration documents, the OCR will notify the applicant to rectify the issues. Amendments or corrections may be required before final approval and issuance of the certificate of incorporation.

Can a registered company in Nepal be dissolved or closed down voluntarily?

Yes, a registered company in Nepal can be voluntarily dissolved or closed down by following the prescribed legal procedures. This may involve obtaining approval from shareholders, settling liabilities, and complying with regulatory requirements for closure.

Also Read: How to Properly Valuate Your Business? 6 Important Methods

Disclaimer: The information provided here is for informational purposes only and should not be considered as legal advice. Please consult with a qualified legal expert for professional legal opinions. You can also consult with our professionals for further assistance.

Company Registration Process in Nepal

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