How to Register FDI Company in Nepal: Complete Step-by-Step Guide 2025

What is FDI Company Registration in Nepal?

Understanding how to register FDI company in Nepal is essential for foreign investors seeking to establish business operations in the country. Foreign Direct Investment in Nepal is regulated under the Foreign Investment and Technology Transfer Act. All the foreign investors (individual or corporate) willing to establish a company in Nepal must obtain a FDI approval from the Government of Nepal.

The process involves obtaining preliminary approval from relevant authorities, followed by company incorporation and final approvals from multiple government agencies.

Step-by-Step Process: How to Register FDI Company in Nepal

Step 1: Preliminary FDI Approval

The first crucial step in how to register FDI company in Nepal involves obtaining FDI approval from the appropriate authority:

For Investments Below NPR 6 Billion:

• Authority: Department of Industry (DOI)
• Processing Time: 7 days for DOI to approve investments up to NPR 6 billion
• Application Portal: imis.doind.gov.np

For Investments Above NPR 6 Billion:

• Authority: Investment Board of Nepal (IBN)
• Processing Time: 15 days for IBN to approve investments above NPR 6 billion

Note: However, in practice of Prime Law Associates, the approval process can take longer, often 1-2 months.

Step 2: Company Name Reservation

After FDI approval, the next step in how to register FDI company in Nepal involves:

1. Name Search: The Firm will search the Office of Company Registrar (OCR) website to check if their proposed company name is available and reserve the name.
2. Name Reservation: Submit application with 3 preferred names
3. Approval Time: 1-2 working days
4. Validity: 6 months from approval date

Step 3: Company Registration at OCR

After obtaining FDI approval, register the company through Office of Company Registrar (OCR)

Required Documents for Company Registration:

• FDI approval certificate
• Reserved name certificate
• Memorandum and Articles of Association
• Shareholders’ passport copies
• Directors’ consent letters
• Registered office proof

Company Registration Timeline:

Step 4: Industry Registration

After obtaining approval for foreign investment, the industry is required to apply for registration of industry at the DOI within 35 days.

Industry Registration Requirements:

• Company registration certificate
• FDI approval letter
• Environmental impact assessment (if applicable)
• Land ownership/lease documents
• Project feasibility study

Step 5: Tax Registration

Tax registration is mandatory for understanding how to register FDI company in Nepal:

PAN Registration:

• Authority: Inland Revenue Department
• Timeline: 1-3 working days
• Documents: Company registration, FDI approval

VAT Registration:

• Threshold: Mandatory for businesses with annual turnover above NPR 2 million
• Timeline: Same day registration available
• Online Portal: ird.gov.np

Step 6: Local Government Registration

Municipal or rural municipality registration is required:

• Authority: Local government office
• Documents: Company registration, tax certificates
• Timeline: 1-2 working days
• Fees: Varies by municipality

Step 7: Bank Account Opening

This is succeeded by the processes of company registration, local level registration, setting up a bank account

Required Documents:

• Company registration certificate
• Tax registration certificates
• FDI approval letter
• Directors’ KYC documents
• Board resolution for account opening

Bank Selection Criteria:

Step 8: Nepal Rastra Bank (NRB) Notification

Subsequently, investors are required to receive a notification letter from Nepal Rastra Bank for investment inflow.

NRB Approval Process:

1. Submit application with company documents
2. Bank verification of investment funds
3. NRB approval for fund transfer
4. Investment remittance through banking channels

Required Documents Checklist

For Foreign Individual Investors:

• ✅ Passport with valid visa
• ✅ Bank statement (last 6 months)
• ✅ Investment source certificate
• ✅ Character certificate from home country
• ✅ Educational qualifications

For Foreign Corporate Investors:

• ✅ Certificate of incorporation
• ✅ Memorandum and Articles of Association
• ✅ Board resolution for Nepal investment
• ✅ Audited financial statements (3 years)
• ✅ Company profile and business plan
• ✅ Authorization letter for representatives

Investment Sectors and Approval Routes

Automatic Approval Sectors:

Understanding how to register FDI company in Nepal includes knowing eligible sectors:

Manual Approval Required:

• Financial services
• Telecommunications
• Large manufacturing projects
• Infrastructure development

Costs and Fees Structure

Government Fees:

Professional Service Fees:

• Legal consultation: NPR 50,000 – 200,000
• Documentation preparation: NPR 25,000 – 75,000
• Translation services: NPR 10,000 – 30,000
• Total estimated cost: NPR 200,000 – 500,000

Timeline Overview

Complete Registration Timeline:

Post-Registration Compliance

Ongoing Obligations:

Compliance with Companies Act, Labor Act, Tax Law and other applicable law of Nepal during the operation of the local subsidiary company.

Monthly Compliance:

• Tax returns filing
• Social security contributions
• Employee provident fund

Annual Compliance:

• Annual general meeting
• Financial audit
• Tax audit (if applicable)
• Renewal of licenses

Best Law Firm For FDI In Nepal

Three-Month Compliance Report:

Submission of 3 months compliance document before OCR

Common Challenges and Solutions

Documentation Issues:

Challenge: Incomplete or incorrect documentation
Solution: Engage qualified legal counsel for document preparation

Timeline Delays:

Challenge: Processing delays beyond official timelines
Solution: Factor 2-3 months for complete registration process

Regulatory Changes:

Challenge: Frequent policy updates
Solution: Regular consultation with legal advisors

Digital Transformation in FDI Registration

Online Portals:

• IMIS Portal: online application through imis.doind.gov.np
• OCR Portal: Digital company registration
• IRD Portal: Online tax registration

Digital Documentation:

• Electronic signatures accepted for most applications
• Digital certificates for company registration
• Online payment systems for government fees

Frequently Asked Questions

How long does it take to register an FDI company in Nepal?

Standard FDI approval typically requires 30-45 days from complete application submission. The complete registration process typically takes 2-4 months.

What is the minimum investment required?

Minimum investment varies by sector. Manufacturing and services typically require NPR 10-50 million, while IT services have no minimum threshold.

Can foreign investors own 100% of a Nepali company?

Yes, foreign investors own 100% of a Nepali company in most sectors, subject to FDI approval.

Which authority approves FDI applications?

Department of Industry approves investments below NPR 6 billion, while Investment Board of Nepal handles investments above NPR 6 billion.

What documents are required for FDI approval?

Foreign investors must submit applications through the online portal (imis.doind.gov.np) with required documentation including project proposals, joint venture agreements (if applicable), and financial credibility certificates.

Is physical presence required in Nepal?

Yes, at least one director must be present in Nepal during the registration process, though this can be managed through authorized representatives.

What are the ongoing compliance requirements?

Companies must comply with annual filing requirements, tax obligations, labor law compliance, and maintain proper accounting records.

Can the registration process be expedited?

Priority sectors with automatic approval routes can be processed faster, typically within 15-30 days for complete registration.

What happens after company registration?

After receiving FDI approval, investors proceed with company registration, followed by industry registration, tax registration, and banking setup.

Are there any restricted sectors for FDI?

Yes, sectors like retail trading, real estate (except industrial use), and certain financial services have restrictions or require special approvals.

Expert Tips for Successful Registration

Pre-Application Preparation:

1. Conduct thorough market research
2. Prepare comprehensive business plan
3. Engage qualified local legal counsel
4. Verify sector-specific requirements

Application Strategy:

1. Submit complete documentation
2. Maintain regular follow-up
3. Prepare for additional information requests
4. Plan for longer timelines than official estimates

Post-Approval Actions:

1. Expedite company registration
2. Set up banking relationships early
3. Begin compliance framework setup
4. Establish local operational presence

Recent Policy Updates (2025)

Simplified Procedures:

• Automatic approval for investments up to NPR 500 million in priority sectors
• Online processing through integrated portals
• Reduced documentation requirements for small investments

New Initiatives:

• Single window clearance for manufacturing projects
• Fast-track approval for technology companies
• Streamlined banking procedures for FDI fund transfers

Conclusion

Understanding how to register FDI company in Nepal requires careful planning, proper documentation, and adherence to regulatory requirements. While the process involves multiple steps and agencies, recent government initiatives have simplified procedures significantly.

Foreign investors should engage qualified legal and financial advisors to navigate the registration process efficiently. With proper preparation and professional guidance, the complete FDI company registration can be accomplished within 2-4 months.

The key to successful registration lies in thorough preparation, complete documentation, and understanding of sector-specific requirements. Nepal’s growing economy and supportive FDI policies make it an attractive destination for international investors seeking business opportunities in South Asia.

Disclaimer: This guide provides general information about FDI company registration in Nepal. Investors should consult qualified legal and financial advisors for specific guidance based on their investment plans and sector requirements.