Liquor License in Nepal: Procedure, Documents, and Legal Framework

A liquor license is a fundamental requirement in the liquor registration process, ensuring that the production, sale, distribution, export and import of liquor comply with legal and regulatory frameworks. The overall aspects of liquor license are governed by the Liquor Act, 2031 B.S and the Regulations framed under it.

General information regarding the liquor license for selling and distribution in Nepal:

1. A person who wishes to produce, sell, distribute, or import/export liquor must submit an application in the format prescribed to the authorized authority.
2. Legal age for consumption for alcohol is 18 years of age and the person below this age cannot purchase, sell or distribute the liquor.
3. Alcohol can only be sold and distributed between 10:00 AM and 10:00 PM. However, the Government of Nepal may modify the timing or remove the location if deemed necessary.
4. No one is allowed to make, sell, or distribute liquor in plastic pouches.
5. Strict following of local rules and regulations is required.
6. Separate license is required for production, distribution and retail.

Procedure of Obtaining Construction License in Nepal

1. Reserve the name of the Company in the Office of the Company Registrar (OCR).
2. Prepare the Memorandum of Association and Article of Association.
3. Submit all documents in Office of Company Registrar for Incorporation
4. Registration in the concerned Local Level Government
5. Registration in Inland Revenue Office for tax purpose.
6. Obtain the Excise Duty Certificate

1. Reserve the name of the Company in the Office of the Company Registrar (OCR)

The initial step in incorporating a construction company is reserving the proposed company name with the Office of Company Registrar (OCR). The chosen name must not be identical to that of any existing construction company. Once the reservation is approved, the proposed name is officially secured.

2. Prepare the Memorandum of Association and Article of Association.

The preparation of the Memorandum of Association and Articles of Association establishes the overall guidelines and procedural framework for the company. These documents should include the company's name, location, type (private limited or public limited), number of shareholders, roles and responsibilities of each stakeholder, and other essential matters relevant to the business operations.

3. Submit all documents in Office of Company Registrar for Incorporation

After preparing the MOA and AOA of the company and gathering other necessary required documents then all the documents should be filed in the OCR for registration. The OCR conducts necessary inquiry and examination of the documents submitted. The required fee should be paid. If all the documents submitted is found satisfactory the OCR will grant the Certificate of Incorporation.

4. Registration in the concerned Local Level Government

After completing registration with the Inland Revenue Office, the company must also be registered with the relevant local authority, whether it is a Rural Municipality, Municipality, Sub-Metropolitan, or Metropolitan, based on its location. Additionally, registration with the concerned Ward Office is required, ensuring compliance with local regulations and community-specific requirements.

5. Registration in Inland Revenue Office for tax purpose.

For tax compliance, a liquor company is required to register with the Office of Inland Revenue. The company must obtain VAT registration. This ensures adherence to legal tax obligations and facilitates transparent financial reporting in accordance with government policies.

6. Obtain the Excise Duty Certificate

The Excise Duty Certificate must be obtained from the Inland Revenue Office. It ensures the responsible sale and distribution of alcoholic beverages by mandating annual license renewal, proper labeling, restricted sales hours, age limitations, separate sales arrangements for departmental stores, and record-keeping to prevent unauthorized transactions. It must be renewed annually.

Documents Required for Liquor License

1. Memorandum of Association and Article of Association
2. Certificate of Incorporation from Office of Company Registrar
3. PAN/ VAT Certificate
4. Tax Clearance Certificate from Inland Revenue Office.
5. Citizenship Certificate of Shareholders of the Business
6. A detailed business action plan of the institution.
7. A certified copy of the citizenship certificate of the director
8. Recommendation letter from the concerned local level.
9. Rental agreement or the property ownership documents of the business premise.

Legal Framework Governing Liquor Licensing in Nepal

The liquor licensing process in Nepal is regulated by various laws and regulations to ensure proper control over the production, distribution, and sale of alcoholic beverages. The key legal provisions include:

1. Liquor Act, 2031 (1974) - Establishes the fundamental legal framework for the production, sale, and regulation of liquor.
2. Liquor Rules, 2033 (1976) - Provides detailed guidelines and procedures for liquor licensing and regulatory compliance.
3. Local Government Operation Act, 2074 (2017) - Grants local governments the authority to regulate liquor sales and enforce licensing requirements.
4. Revenue Leakage (Investigation and Control) Act, 2052 (1995) - Focuses on preventing tax evasion and ensuring proper revenue collection from the liquor industry.

Authorities Concerned for Governing Liquor Business in Nepal

1. Department of Revenue Investigation
2. Department of Inland Revenue
3. Department of Food, Technology and Quality Control
4. Office of the Company Registrar
5. Nepal Bureau of Standards and Meteorology
6. Nepal Police
7. Local Level Government

Conclusion

In Nepal, the liquor licensing process is governed by the Liquor Act, 2031 (1974) and Liquor Rules, 2033 (1976), ensuring the legal sale, distribution, and consumption of alcohol. Businesses must follow a structured process, including obtaining proper documentation, registering with the Inland Revenue Office, and securing an Excise Duty Certificate. Strict regulations, such as age restrictions, sales hours, and separate licenses for production, distribution, and retail, must be adhered to. Authorities like the Department of Revenue Investigation and Nepal Police oversee compliance, ensuring a responsible and legally regulated liquor industry.