Foreign Investment Approval Nepal DOI: Complete Guide 2025

What is Foreign Investment Approval in Nepal?

Foreign investment approval nepal doi represents the mandatory regulatory process overseen by Nepal’s Department of Industry (DOI). This comprehensive system ensures foreign investors comply with national investment policies while contributing to economic development. The approval mechanism has been streamlined significantly, making Nepal an attractive destination for international businesses.

Prior approval from the Department of Industry through the FITT Unit of OSSC is mandatory before company registration, establishing the DOI as the primary authority for investment approvals under NPR 6 billion.

Understanding the Department of Industry’s Role

The Department of Industry serves as Nepal’s gateway for foreign investment approval nepal doi processes. Located within the Ministry of Industry, Commerce, and Supplies, the DOI facilitates investment through its Foreign Investment and Technology Transfer (FITT) Unit. This specialized unit operates under the One Stop Service Center (OSSC), providing centralized services to investors.

Key Functions of DOI in Investment Approval:

• Processing foreign investment applications below NPR 6 billion
• Issuing preliminary approvals for FDI projects
• Coordinating with other regulatory bodies
• Monitoring compliance throughout investment lifecycle
• Facilitating technology transfer agreements

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Current Investment Thresholds and Authority Distribution

The Government of Nepal streamlined the process for approving foreign investments of up to NPR 500 million (~$37.6 million), introducing automatic approval routes for smaller investments.

Minimum Capital Requirements for Foreign Investment

Foreign investment approval nepal doi mandates specific minimum capital thresholds:

• General Industries: NPR 20 million (approximately $150,000)
• IT-based Industries: Lower thresholds under automatic approval
• Manufacturing Sectors: NPR 20 million minimum
• Service Industries: NPR 20 million minimum

The minimum foreign investment required is NPR 20 million (approximately USD 150,000), with exceptions for IT-based industries under automatic approval routes.

Essential Documents Required for DOI Approval

For Individual Foreign Investors:

• Notarized passport copy with apostille authentication
• Bank statement showing financial capability
• Clean criminal record certificate
• Project feasibility study
• Technology transfer agreement (if applicable)

For Corporate Foreign Investors:

• Certificate of Incorporation, Memorandum of Association and Articles of Association
• Board resolution authorizing investment
• Audited financial statements (last 3 years)
• Power of attorney for local representatives
• Joint venture agreement (if applicable)

Common Requirements:

• Completed application form (available at imis.doind.gov.np)
• Project proposal with detailed business plan
• Environmental impact assessment (for specific sectors)
• Land acquisition documents or lease agreements

Step-by-Step Application Process

Phase 1: Pre-Application Preparation

Investors must prepare comprehensive documentation before initiating the foreign investment approval nepal doi process. This includes conducting feasibility studies, securing local partnerships (if required), and ensuring compliance with sectoral regulations.

Phase 2: Online Application Submission

Foreign investors must submit applications through the online portal (imis.doind.gov.np) with required documentation. The digital platform streamlines document submission and tracking.

Phase 3: DOI Review and Evaluation

The FITT Unit conducts thorough evaluation considering:

• Economic impact assessment
• Technology transfer benefits
• Employment generation potential
• Environmental compliance
• Sectoral policy alignment

Phase 4: Approval Issuance

Upon satisfactory review, DOI issues preliminary approval certificates. After obtaining approval for foreign investment, the industry is required to apply for registration of industry at the DOI within 35 days.

Legal Framework Governing Foreign Investment

The foreign investment approval nepal doi operates under several key legislations:

Primary Laws:

• Foreign Investment and Technology Transfer Act (FITTA) 2019
• Industrial Enterprises Act 2020
• Companies Act 2006
• Nepal Rastra Bank Act

Recent Amendments (2025):

Foreign investors may make equity investments in an industry by purchasing units of SIF, such as, capital investment funds (venture capital funds) or other funds registered with the Securities Board of Nepal (SEBON) with its approval.

Sectors Open for Foreign Investment

Repatriation and Exit Provisions

Foreign investors enjoy liberal repatriation policies under foreign investment approval nepal doi:

Permitted Repatriations:

• Principal investment amount
• Profits and dividends earned
• Proceeds from asset sales
• Loan principal and interest payments

Repatriation Process:

Approval from DOI or IBN and NRB approval is required before repatriation. Investors can repatriate in original currency or other convertible foreign currencies.

Recent Policy Developments (2025)

The Government of Nepal continues modernizing its foreign investment approval nepal doi framework:

• Automatic Approval Routes: Expanded to cover more sectors
• Digital Integration: Enhanced online processing systems
• Simplified Documentation: Reduced paperwork requirements
• Time-bound Processing: Strict adherence to approval timelines

Common Challenges and Solutions

Documentation Delays

Challenge: Apostille authentication delays from origin countries.
Solution: Engage local legal counsel for document preparation guidance.

Sectoral Restrictions

Challenge: Understanding sector-specific limitations.
Solution: Consult DOI’s sectoral guidelines before application.

Compliance Monitoring

Challenge: Ongoing regulatory compliance requirements.
Solution: Establish dedicated compliance teams with local expertise.

Frequently Asked Questions (FAQs)

Q1: What is the minimum investment required for foreign investment approval in Nepal?

The minimum threshold is NPR 20 million (approximately $150,000) for most sectors, with certain IT-based industries eligible for lower amounts under automatic approval routes.

Q2: How long does the DOI approval process take?

Processing time varies: automatic route (7-15 days), regular process (35-60 days), depending on investment amount and sector complexity.

Q3: Can foreign investors establish 100% owned companies?

Investor is permitted to establish the single man company except in the industries. Most sectors allow 100% foreign ownership, with specific restrictions in strategic sectors.

Q4: Where is the DOI located, and how can investors contact them?

The Department of Industry operates from Kathmandu, with the FITT Unit handling foreign investment matters. The online portal (imis.doind.gov.np) provides primary access.

Q5: What happens after DOI approval?

Investors must register their company within 35 days and obtain final approval from Nepal Rastra Bank before commencing operations.

Q6: Are there any restrictions on profit repatriation?

Expatriates are permitted to take back 75% of their salary, allowances and emolument. Profit repatriation is generally unrestricted with proper approvals.

Q7: Which sectors are prohibited for foreign investment?

Certain strategic sectors like defense, postal services, and retail trading (except department stores) restrict foreign participation.

Q8: Can investment amounts be transferred between parties?

The amount of foreign investment may be transferred to any person or entity, in whole or in part, with the approval from DOI.

Professional Legal Assistance

Navigating foreign investment approval nepal doi requires expertise in Nepalese investment law. Professional legal counsel ensures compliance, minimizes delays, and maximizes investment success. Experienced law firms provide comprehensive services from application preparation to post-approval compliance monitoring.

Conclusion

The foreign investment approval nepal doi system represents Nepal’s commitment to attracting foreign investment while maintaining regulatory oversight. With streamlined processes, digital integration, and liberal policies, Nepal offers attractive opportunities for international investors. Success depends on thorough preparation, proper documentation, and compliance with evolving regulations.

Understanding the DOI’s role, meeting minimum thresholds, and following prescribed procedures ensures smooth approval processes. As Nepal continues modernizing its investment framework, foreign investors can expect enhanced efficiency and transparency in foreign investment approval nepal doi procedures.