Company Registration Process In Nepal
A detailed guide and Information on the company registration process in Nepal along with the Information on costs and fees involved.
Documents Required (Private Company)
Following documents are required to be presented at the office of the company registrar for registering a private company in Nepal:
An application in the format as per the ‘ANUSUCHI 1’ along with a 5 rupees stamp attached to it.
Two copies of ‘PRABANDHA PATRA’ (Article of Association),
Two copies of ‘NIYAMAWALI’ (Article of Memorandum).
A copy of the mutual agreement (if any).
Attested copies of the citizenship certificates of the founder shareholders.
Private Company Details
Post Registration Compliances
After registering the company, the company has a number of obligations that must be met. A private company is obligated to many rules and they are discussed below. The obligations required to abide by, after the registration of a private company is called post registration procedure. If not met, penalties are charged.
Notification of Registration (within 3 months after registration of company) After the registration process is complete and the company receives the certificate of registration, a notice must be provided. A registered company in Nepal needs to be in Nepal under the rules of the Companies Act and the notice of the registered office should be provided. The registration number of the company, address of the company and other details of the company should be outlined and set where the company is established. These details must be provided to the Companies Registrar Office within three months after the registration of the company.
Shareholding Detail
(within a month after the amount of share capital is paid by shareholders)
The company should provide a Shareholders register and should file that with the office of companies after the share capital of the company is issued and paid by the shareholders. This process should be completed within a month’s duration of the amount being paid.
Details for Directors: (within 7 days of taking the office)
As of the details given by the company for the directors, the details of the directors of the company must be submitted by the Directors within seven days of taking office.
Annual General Meeting (AGM)
The company is required to run or conduct an Annual General Meeting (AGM), after the completion of one year of the establishment of the company. AGM should be conducted where the details of the company’s activities within one year must be discussed. This might not be applicable for private companies if it is not mentioned in their articles and the Memorandum of Association.
Accounting / Financial Requirements
The details of the company’s financial documents and activities must be kept properly and need to be audited by an auditor at the completion of every financial year. The auditor should be appointed by all the shareholders and the appointment should be notified within 15 days of appointment to the Office of Companies Registrar Office. Audited Report of financial details are presented in front of all the shareholders at AGM.
Filing Requirements for Company Registration in Nepal
All the details like the auditor’s report, report of the number of shareholders in the company at the time, and an annual audited account needs to be filed within the six months of the end of the fiscal year.
According to the index 21, the company registration fee depends on the registered capital of company. If the fee is up to NRs.5000, the payment is made in the accounts section of the office itself. If the charge is more than NRs 5000, then the amount should be deposited at the Nepal Rastra Bank, Banking Office, Thapathali, Kathmandu or in a branch of the commercial bank permitted by Nepal Rastra Bank, in the ‘RAJASWA’ account number1-1-05-10. Then two copies of the voucher should be submitted in the accounts section of the office of the company registrar, and the receipt should be presented in the registration section.
Company registration Cost is depends upon government’s fees and again it is based on Authorized Capital. This is the list for an individual who has Nepali nationality and is willing to open a private limited company. Please make a note that the following list may be modified in near future:-
Excise duty to be paid at Company Registrar Office based on the Authorized Capital of the Company.
Up to NPR 100,000 : NRS 1,000.
NRS 100,001 to NRS 500,000: NRS 4,500.
NRS 500,001 to NRS 2,500,000: NRS 9,500.
NRS 2,500,001 to NRS 10,000,000: NRS 16,000.
NRS 10,000,001 to NRS 20,000,000: NRS 19,000.
NRS 20,000,001 to NRS 30,000,000: NRS 22,000.
NRS 30,000,001 to NRS 40,000,000: NRS 25,000.
NRS 40,000,001 to NRS 50,000,000: NRS 28,000.
NRS 50,000,001 to NRS 60,000,000: NRS 31,000.
NRS 60,000,001 to NRS 70,000,000: NRS 34,000.
NRS 70,000,001 to NRS 80,000,000: NRS 37,000.
NRS 80,000,001 to NRS 90,000,000: NRS 40,000.
NRS 90,000,001 to NRS 100,000,000: NRS 43,000.
Additional than NRS 100,000,000: NRS 43,000 plus NRS 30 for all added NRS 100,000
More Detail About Company Registration Process
The registration of company in Nepal is governed by the Companies Act 2006 (2063) (“Companies Act”) . The Office of Company Registrar (“OCR”) is the competent authority to govern the company registration.
This article mainly covers the registration process of Company in Nepal.
1. Types of Companies Under Companies Act
1.1 Under the Companies Act, the following types of companies can be registered:
a) Private company;
b) Public company; and
c) Profit not distributing company
1.2 The basic difference between public companies and private companies are the ability to raise the fund from the general public.Public companies can raise the fund from the general public by issuing securities such as shares, bonds or debentures. However, the private companies are restricted from collecting the fund by offering the shares in such a manner. Similarly, a public company should have minimum of 7 shareholders with no maximum limit. However, the maximum number of shareholders of a private company cannot exceed more than 101.
1.3 Similarly, profit not distributing companies can be incorporated for the following objectives:(a) development and promotion of any profession;(b) protection of collective rights and interests of the persons engaged in a specific profession or occupation; and (c) for the attainment of any scientific, academic, social, benevolent or public utility or welfare objective on the condition of not distributing dividends.
2. Company as the most common form of business vehicle in Nepal:
2.1 Limited liability companies are the most common forms of business vehicles in Nepal. Among them, private limited company is commonly registered business vehicle in Nepal. A company carrying business relating to banking and financial transaction, insurance, stock exchange, pension fund or mutual fund needs to be compulsory registered as a public company.
2.2 One of the advantages for registering a limited liability company is that the lability of the shareholder of the company is limited to the extent of amount of investment made by such shareholder.
3. Procedure of Registration of Company:
The following provides the steps for registration of a company:
4. Time Required for Registration:
Total time required for registration of a new company is 7 to 10 days.
5. Documents Required for Registration of Company:
Following are the documents required for the company registration:
6. Minimum Amount of Investment:
7. Government Fee:
Government fee is charged based on the proposed authorized capital of the company.
7.1. Government fee for a private company
7.2. Government fee for a public company
8. Business Specific Approval/Licenses:
Certain regulated businesses related to bank and financial institutions, hydropower, travel and trekking businesses, hospitals etc. are subject to additional approvals or licenses for the commencement of their business activities.
9. Tax Registration:
Every company is required to obtain a PAN or VAT Registration certificate from Inland Revenue Department prior to the commencement of its business depending on the value of the annual transaction of the business.
Online Company registration in Nepal
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Regarding the company registration you can register any type of company like trekking agency, travel agency, foreign investment, press, production house, money exchange, import, export, language centre, institution, construction office, volunteer service, medicine production house etc. within a single day too. To register a private, public, not-profit distributing company and One-Man Company you have to prepare various documents like Memorandum of Association and Articles of Association etc.
