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A company in Nepal is a legal entity formed under the Companies Act, 2063 (2006) for the purpose of conducting business activities. It is recognized as a separate legal person, distinct from its shareholders and directors, with rights to own property, enter into contracts, and sue or be sued in its own name. The Office of the Company Registrar (OCR), under the Ministry of Industry, Commerce, and Supplies, is the governing body responsible for company registration and regulation.
Companies in Nepal can be classified into several types, including private limited, public limited, non-profit (not distributing profit), and foreign companies. The most common form is the private limited company, which is suitable for small to medium enterprises and requires a minimum of one shareholder and one director. Public companies, on the other hand, can raise capital from the public and must comply with stricter regulations.
Registering a company in Nepal involves reserving a company name, preparing legal documents such as the Memorandum and Articles of Association, and completing the registration process through the OCR’s online portal. Once registered, companies must obtain a PAN/VAT certificate from the Inland Revenue Department and follow regulatory requirements to remain in good legal standing.
Types of companies in Nepal
1. Private Limited Company:
A Private Limited Company is the most common form of company registered in Nepal. It is suitable for small to medium-sized businesses and requires a minimum of one and a maximum of 101 shareholders. This type of company restricts the transfer of shares and cannot invite the public to subscribe to its shares or debentures. It is ideal for family-run businesses or startups due to its flexible structure and fewer regulatory obligations compared to public companies.
2. Public Limited Company:
A Public Limited Company is allowed to raise capital by offering its shares to the public. It requires a minimum of seven shareholders and three directors. This type of company is subject to strict regulations and must be listed on the Nepal Stock Exchange if it offers shares to the public. Public companies are commonly formed for large-scale operations, such as banks, insurance firms, and hydropower projects.
3. Profit Not Distributing Company (Non-Profit):
This type of company is established for social, charitable, educational, or similar non-profit purposes. It does not distribute profits or dividends to its members. Instead, any earnings must be used to further the company’s objectives. Such companies require at least five members and are typically registered by NGOs or community organizations.
4. Foreign Company:
A Foreign Company is a business entity incorporated outside Nepal but intending to operate within Nepal. Such companies must register with the Office of the Company Registrar and obtain approval from Nepal Rastra Bank if they plan to invest or repatriate funds. These companies must comply with local laws and often set up branch offices or liaison offices to conduct their operations.
5. Government-Owned Company:
A Government-Owned Company, also called a public enterprise, is fully or majority-owned by the government of Nepal. These companies are established to provide public services or manage essential industries such as electricity, water supply, or transportation. They are governed by specific acts or through the general provisions of the Companies Act.
Online Company Registration in Nepal
1. Reservation of Company Name at the Office of the Company Registrar
Before forming a company, the applicant must ensure that the proposed company name is available. This can be efficiently done through the official website of the Office of the Company Registrar: https://ocr.gov.np. To search for a company by its registration number, visit: https://application.ocr.gov.np/faces/CompanyDetails.jsp. To begin the registration process, navigate to: https://application.ocr.gov.np/CRO/faces/OnlineUserLogin.jsp.The applicant must then complete a short online form, create a user account with a username and password, and verify whether the intended company name is already in use.
2. Online Submission of Signed Documents to the OCR
After confirming the availability of the company name, the applicant must submit all required documents for company registration. It is highly recommended that the Memorandum of Association (MOA) and Articles of Association (AOA) be prepared in accordance with the Company Act 2063.
3. Review of Submitted Documents by the OCR
Once the documents are submitted, the Office of the Company Registrar conducts a brief yet thorough examination. This review checks the consistency of the company’s stated objectives, verifies the signatures of all shareholders, identifies any errors, and ensures compliance with the Company Act 2063. If any major issues or discrepancies are found, the Registrar will notify the applicant, who must then make the necessary corrections.
4. Issuance of the Company Registration Certificate
After the documents pass the OCR’s review, a Certificate of Company Registration is issued. This certificate serves as official recognition of the company’s legal establishment.
5. Tax Registration (PAN/VAT) at the Inland Revenue Office
Following the receipt of the Company Registration Certificate, the next step is to obtain a PAN (Permanent Account Number) from the Inland Revenue Department. The PAN is essential for fulfilling the company’s tax and VAT obligations in Nepal.
Documents required for registration
- Application for registration
- Memorandum of association and articles of association of the proposed company
- National ID card
- Shareholders’ 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
Services provided by Alpine to set up a Company in Nepal (Company Registration Lawyer in Nepal)
1. Company Name Reservation Service
Before registering a company, entrepreneurs must reserve a unique name for their business through the Office of the Company Registrar (OCR). This process ensures that no other company is operating under the same or a confusingly similar name. The name can be reserved online via OCR’s official portal, making the initial step convenient and efficient.
2. Document Preparation and Drafting Service
Preparation of essential legal documents is a critical part of company registration. This includes the drafting of the Memorandum of Association (MoA) and Articles of Association (AoA) in accordance with the Company Act, 2063. Professionals or legal service providers often assist in preparing these documents to avoid errors and ensure compliance with Nepalese law.
3. Online Submission and Application Filing
Once the documents are ready, they must be submitted electronically through the OCR’s online portal. This service simplifies the registration process by allowing applicants to fill out application forms, upload documents, and track their application status from anywhere, reducing the need for physical visits.
4. Verification and Review Service by OCR
The Office of the Company Registrar reviews all submitted applications to check for compliance, accuracy, and completeness. The verification process ensures that all legal requirements are met, including proper signatures, objectives of the company, and share structure. Applicants may be required to respond to queries or resubmit corrected documents if discrepancies are found.
5. Government Fee Payment Facilitation
After the application is approved, applicants must pay the registration fee based on the company’s authorized capital. Payment services, both online and in-person, are available to facilitate timely submission of these fees, which vary depending on the type and size of the company being registered.
6. Issuance of Company Registration Certificate
Once the documents are verified and the fees are paid, the OCR issues a Company Registration Certificate. This certificate legally recognizes the company as a separate legal entity in Nepal. It serves as an essential document for opening a bank account, applying for licenses, and conducting business activities.
7. PAN/VAT Registration at the Inland Revenue Office
Following company registration, businesses must register for a Permanent Account Number (PAN) and, if applicable, Value Added Tax (VAT) at the Inland Revenue Department. These services are crucial for tax compliance and are mandatory for companies intending to conduct taxable transactions within Nepal.
8. Local Level Business Registration Service
Businesses are also required to register at the local municipality or ward office. This service is necessary for acquiring a local business operation certificate, which allows the company to legally operate within its jurisdiction and ensures compliance with municipal regulations.
9. Bank Account Setup Assistance
Opening a corporate bank account is an important post-registration requirement. Service providers assist companies in preparing the required documents and coordinating with banks to open accounts where share capital can be deposited and business transactions can be managed securely.
10. Sectoral Licensing and Approval Services
Depending on the nature of the business, additional licenses or permits may be required from relevant government bodies such as the Department of Commerce, Department of Industry, or Nepal Rastra Bank. Legal professionals or consultants help obtain these sector-specific approvals, especially for regulated industries like e-commerce, foreign investment, or financial services.
The online process of company registration in Nepal (Online Company Registration in Nepal) offers a streamlined and efficient pathway for entrepreneurs to establish legal entities under the Companies Act, 2063. With digital access through the Office of the Company Registrar’s portal, applicants can reserve a company name, submit required documents, and receive official registration certificates with minimal physical interaction. This system enhances transparency and accessibility, reducing bureaucratic delays. Following registration, companies must obtain a PAN/VAT number from the Inland Revenue Department to meet tax obligations. The online platform has significantly modernized company formation, promoting ease of doing business and encouraging formal economic participation across diverse sectors.
Frequently Asked Questions
You can register a company online through the Office of the Company Registrar (OCR) website by reserving a company name, submitting required documents like MOA and AOA, and completing the application process digitally.
Nepal allows registration of Private Limited Companies, Public Limited Companies, Profit Not Distributing (non-profit) companies, Foreign Companies, and Government-Owned Companies.
Key documents include the application form, Memorandum of Association (MOA), Articles of Association (AOA), national ID or passport, shareholders’ agreements, and approval letters if applicable.
Typically, the online registration process takes about 7 to 14 working days, depending on document verification and processing speed by the OCR.
Yes, after company registration, obtaining a Permanent Account Number (PAN) from the Inland Revenue Department is mandatory for tax compliance and financial transactions.
Yes, foreigners can register companies online but must provide additional documents such as foreign investment approval and passport copies during the process.
The OCR is the official government body responsible for name reservation, document verification, company registration approval, and issuing company certificates.
Yes, fees vary based on company type and authorized capital and must be paid during the registration process either online or at designated banks.
After registration, companies must register for PAN/VAT, open a corporate bank account, and complete local-level business registration at the municipality or ward office.
Alpine Law Associates offers end-to-end legal services including company name reservation, document drafting, online filing, fee payment facilitation, and post-registration compliance assistance.
Disclaimer:
This article is intended solely for informational purposes and should not be interpreted as legal advice, advertisement, solicitation, or personal communication from the firm or its members. Neither the firm nor its members assume any responsibility for actions taken based on the information contained herein.