<h2>Introduction</h2>&nbsp;While buying a business, whether&nbsp;<a href="https://www.biznestbazaar.com/blog/legal-process-of-selling-a-private-business-in-nepal">privately owned</a> or publicly owned has different rules and regulations definitely mentioned in The Companies Act, 2063; governs the formation, operation and dissolution of companies in Nepal. The Private firm Registration Act of 1958; controls sole proprietorship or&nbsp;<a href="https://www.biznestbazaar.com/blog/how-to-register-a-private-firm-in-the-department-of-small-and-cottage-industry-in-nepal">private firm registrations in Nepal</a> and Partnership Act 2020; which regulates partnership firms in Nepal.&nbsp;&nbsp;When entrepreneurs decide on buying business in Nepal, the procedures and also rules and regulations differ according to the business they are buying. Generally when we talk about buying a business, it means to buy a business share, liabilities and assets.&nbsp;&nbsp;The entrepreneurs mapping way and their course in the realm of business, the resoluteness to buy an existing enterprise stands as a key period, piled high with capability and challenges. The process of buying any established business is not merely a financial investment of an entrepreneur but a strategic headway that can reanalyze an entrepreneur’s way. Buying an established business means entering in a period, where the potential as well as history collide; it’s about preserving a legacy while incorporating own visions and plans for the future.&nbsp;Distinctly, starting any business from scratch, acquiring an established business restricts navigating through a landscape of already existing operations, the presence of the business market, and perceptions of customers. To carry out business, it requires a determined sight for potential, a deep understanding of business and social values, and an acute calibration with self’s entrepreneurial aspirations and capabilities. While an entrepreneur buys a business, it’s a balancing act between persuasion of an already established business foundation and the drive to infuse innovation and personal business rationale.&nbsp;&nbsp;Buying a business is a critical decision which demands accurate evaluation, understanding the complexity of the running business operations, assessing its financial health and picture its growth track under new direction.&nbsp;Simply, buying any established business is a crucial leap into a sphere of already existing challenges and opportunities of business. After buying a business, it requires a combination of strategic foresight, diligent analysis and a keen commitment to steering an existing enterprise towards a new horizon in the realm of business.&nbsp;&nbsp;An entrepreneur has a choice to buy an already existing business or to start from scratch, choosing each one has its own challenges and opportunities in the realm of business.&nbsp;&nbsp;The factors follow are important elements to think about when an entrepreneur wants to buy an already existing business:&nbsp;&nbsp;<h3>What are the Advantages of Buying a business?</h3>&nbsp;<ol><li>Already established business operations: Already established businesses often have established processes, financial timeline, customer bases, revenue streams, which reduces early startups time and early stage difficulty. &nbsp;</li><li>Trained Employees: When an entrepreneur buys an already existing business then, they will also get already trained employees. The trained employees are those who are already trained with the running operations and know about the operations. The availability of trained employees can lead to smoother transitions and less need of intensive training in the field. &nbsp;</li><li>&nbsp;&nbsp;Easier Financing: Acquiring financing for the purchase of an&nbsp;<a href="https://www.biznestbazaar.com/blog/advantage-is-buying-pre-registered-companies-in-nepal">established company</a> with a track record may be simpler. &nbsp;</li><li>Proper access to suppliers and networks: Buying an already established business is a benefit factor for the proper access to suppliers and networks. The established business usually has relationships with suppliers, distributors, and other contacts in industry. Getting hold of relationships can be valuable and can save time and effort in establishing new business. &nbsp;</li><li>Immediate cash flow: Running a startup may take time to generate revenue but buying an established business can provide immediate cash flow from existing business operations.&nbsp;</li></ol>&nbsp;<h3>What are the challenges and considerations?</h3>&nbsp;<ol><li>Market Research: The foremost challenge will be to research the existing market. Understanding about the trend in the current market and also the future potential of the business in the realm of business.&nbsp; &nbsp;</li><li>Due diligence: The evaluation of the company’s legal issues, finances, running internal operations, competitive landscapes and possible risk in detail.&nbsp; &nbsp;</li><li>Adaption to Change: The market, the consumer’s preference, economic conditions and technologies do constantly evolve. So, businesses must be able to move quickly and adapt to survive and thrive in a realm.&nbsp; &nbsp;</li><li>Legacy Issues: Entrepreneur shall be aware of any existing issues in the business, like; about the technology, is it outdated? The morale of employees, or any pending legal matters.&nbsp; &nbsp;</li><li>Integration with existing operations: The entrepreneur if already owns a business, they shall consider how the new acquisition will integrate with current running operations.&nbsp;</li></ol>&nbsp;<h2>Startup Vs.&nbsp;Buying Business</h2>&nbsp;<ul><li>Risk and Innovation: When starting a new business it comes with an opportunity to bring a new, unique and updated idea to the market, but carries higher risk and uncertainty.&nbsp; &nbsp;</li><li>Control and Vision: The journey of<a href="https://www.biznestbazaar.com/blog/a-comprehensive-guide-to-securing-startup-funding-in-nepal"> startup entrepreneurship</a> allows entrepreneurs to develop and build their own culture from the very beginning. But, when buying the business; the people working there shall follow the already existing business culture. &nbsp;</li><li>Time and Effort: Comparatively, a startup business needs more time and effort in the initial phase of the business. But buying an already established business does not require much time.</li></ul>&nbsp;Also read:&nbsp;<a href="https://www.biznestbazaar.com/blog/industry-registration-process-in-nepal">Industry Registration Process In Nepal</a>&nbsp;<h2>Guide on buying Business in Nepal</h2>&nbsp;The process of buying a business starts from the thought of buying business. Buying business also holds and also involves various; several key steps, each critical to ensuring a successful acquisition.&nbsp;Here are basic ideas and outline of the major stages involved in this process:&nbsp;<h3>Self-Evaluation and Goal Setting</h3>&nbsp;The very first step in the journey of entrepreneurship, through buying business; self-evaluation and goal setting is a critical foundation stage. It involves self-analyzing and strategic planning to ensure that the decision to buy a business is with self and also professional objectives. An entrepreneur shall reflect in their skills, experiences and area of expertise.&nbsp; An entrepreneur, based on self-evaluation, sets clear objectives for what you want to achieve by buying business. For an entrepreneur, a thorough and honest self-evaluation, combined with clear goal setting, will guide an entrepreneur; in making informed decisions throughout the process.&nbsp;&nbsp;&nbsp;<h3>Market Research and Search for Opportunities</h3>&nbsp;The next step in buying a business, is market research and search for opportunities, which involves an in-depth investigation into potential industries and specific business sales. The following step is crucial for identifying a business that not only orientates with goals and interests of a business but also holds essential measures and processes for sustainable success. While doing market research and search for opportunities an entrepreneur shall also do industry analysis, and understand the growth potential, stability, trends and risks of the business. Business shall also assess the level of competition within the industry of the business realm. While searching for opportunities, the entrepreneur shall reach initial contact and gather information, by reaching out to sellers or brokers to gather more information. The initial interaction can also give you a sense of the sellers motivations and the business operational culture.&nbsp;<h3>Evaluation of Potential Businesses</h3>&nbsp;The third step of buying a business is evaluation of potential businesses. This is the initial evaluation of potential businesses, and is crucial in narrowing down the choices to the most operable options. The very step involves a preliminary assessment of businesses that have caught your interest based on the market research. During the evaluation phase an entrepreneur shall do overview analysis of a business, with a high level review of each business. The business model, the products or services offered, market position, and customer base shall be checked and looked upon. The financial health of the business shall also be checked i.e. profit and loss statements, balance sheets, cash flow statements and tax returns.&nbsp;&nbsp;<h3>Preliminary Financial Assessment</h3>&nbsp;The fifth step is, preliminary financial assessment is a crucial step in the process of buying a business. It involves diving further into the economic variables of the potential businesses to understand its economic viability, profitability and financial health. While doing preliminary financial assessment, the entrepreneur shall review financial history of the business, which is reviewing past financial data.&nbsp; While in the preliminary financial assessment, the&nbsp;<a href="https://www.biznestbazaar.com/blog/how-to-properly-valuate-your-business-6-important-methods">business shall be evaluated</a> and assets shall be analyzed i.e. value of the business, including physical assets, intangible assets and inventory.&nbsp;&nbsp;&nbsp;<h3>Making Contact and Initial Discussions</h3>&nbsp;The fifth step is making contact and initial discussion. In this step, the entrepreneur shall discuss the potential buyer and transitions from research and assessment to direct engagement with the seller or seller’s representative. Entrepreneur shall establish an initial contact by approaching the seller or broker, and initiate contact with the seller, representing business. Before heading for initial discussion, there shall be the preparation of a list of preliminary questions that an entrepreneur has about the business. The initial discussion includes the initial meeting with the seller or broker; to understand more about business and establish a bond. Discussing the business overview, in this process an entrepreneur shall use this opportunity to ask questions and know about the business operations, market position, customer base, employee structure.&nbsp;&nbsp;<h3>Detailed Analysis and Due Diligence</h3>&nbsp;The step of detailed analysis and due diligence is a critical and in-depth phase in the process of buying a business. This step involves the minute examination and verifying all aspects of the business to ensure you are making a well-informed decision. The financial analysis shall be conducted; a comprehensive review of the business’s financial statements, including income statements, balance sheets, cash flow statements, and tax returns. While diligence, verify the legal status of the business and ensure it is in good standing. In detailed analysis, entrepreneurs shall analyze market position and competition. While analyzing the market, analyze the market trends to understand the businesses future potential and growth opportunities. The detailed procedure aids in spotting any possible issues, figuring out any potential problems, understanding the true value of the business, and guaranteeing that the investment is sound.&nbsp;&nbsp;<h3>Business Evaluation</h3>&nbsp;The next step is business evaluation and is an elemental process in the process of buying a business. This step involves; determining the economic value of a business. This is a very crucial step while buying a business because it helps in understanding business worth and potential in the negotiation period.&nbsp;&nbsp;<h3>Negotiating the Purchase</h3>&nbsp;The eighth step is negotiating the purchase, it is a step where the buyer and seller engage in discussions to agree upon the terms of sale. It is a crucial stage where it requires a determined strategy, clear communication, and sometimes a few concessions are needed during this phase. During this period, there shall be understanding of sellers’ motive in&nbsp;<a href="https://www.biznestbazaar.com/blog/8-things-to-consider-while-selling-your-business">selling the business</a>; it can provide valuable insights during negotiations. While negotiating, make the initial offer based on the business valuation and what is the willingness to pay. After the negotiating phase, draft the terms, after reaching verbal agreement; draft the terms of purchase i.e. purchase of price, terms of payment, transition period, assets included in the sale. Have the review by legal counsel and refine the purchase agreement. When both the parties agree on the terms, sign it to finalize the negotiation.&nbsp;&nbsp;<h3>Securing Financing</h3>&nbsp;The step of securing financing is an analytical step, where it involves exploring and arranging the financial resources necessary to complete the acquisition. While working through this step, an entrepreneur shall determine the total investment i.e. calculate the total amount of money required, which includes the purchase price, additional funds for improvements or expansion, and working capital to run the business. Reviewing personal financial resources, assess how much personal capital an entrepreneur can invest. In case of, not enough financing, different other sources of financing shall be explored. While talking about securing financing, it requires a close understanding of different options available and their implications.&nbsp;<h3>Finalizing the Acquisition</h3>&nbsp;Finalizing the acquisition is the apex point or step in buying a business, where all the preparatory work, negotiations and planning come to attainment. The following steps involve completing legal formalities, transferring ownership and executing the agreed upon terms of sale. Drafting the final purchase agreement, where it should detail every aspect of the transaction, including price, terms of payment, asset lists, intellectual property being transferred, and any representations and warranties. Both the parties shall review their legal documentation by their lawyers. There shall be ensure that all financing for the acquisition is in place for payment. A closing meeting shall be held, for usually; to sign the final documents and transfer of the payment. During the closing, ownership of the business is officially transferred to the buyers.&nbsp;<h3>Transition Planning and Execution</h3>&nbsp;Transition Planning and Execution is a critical step or phase after finalizing the acquisition of a business. This phase includes, managing the changeover from the previous owner to the new owner, ensuring continuity and laying the preparations for future success. The pre-closing transition planning shall be developed to create a comprehensive plan outlining how the transition be managed. Meeting the seller shall be done during this phase, to understand all aspects of the business operations to discuss in detail about customer relationships, vendor contacts, employee roles and daily operational procedures. This phase also includes understanding the culture. The beginning of a long-term strategic plan starts from this phase. The continuous improvement; keep assessing the business performance and make continuous improvements. This phase is about blending respect for the existing business practices with the infusion of the new ideas and management style.&nbsp;&nbsp;<h3>Post-Purchase Management and Growth Planning</h3>&nbsp;This is the final phase in the process of buying a business. This stage is all about planning for future expansion and running the company after the change. It’s an analytical phase where the new owner implements their vision and begins to make the mark on the business. Immediate post purchasing management, needs assessing the business operations; should understand the ongoing operations of the business and look to the places where there needs the improvements in business operation. The financial review and management shall be done, and be knowledge about business financial health. This phase is seen as the phase to build relationships with key stakeholders. Now, the entrepreneur shall develop a long term strategic plan for the business which includes setting goal for the growth, expansion, and product development. Now, the entrepreneur shall also continuously analyze the market trends and customer needs. The goal of post-purchase management and growth planning is about to seize control and direct and steering of sustained prosperity. It combines strategic planning, operational management and ongoing adjustment to changing market dynamics.&nbsp;&nbsp;Also read:&nbsp; <a href="https://www.biznestbazaar.com/blog/company-registration-process-in-nepal">Company Registration Process in Nepal</a>&nbsp;Disclaimer: The information provided here is for informational purposes only and should not be considered as legal advice. Please consult with a qualified legal expert for professional legal opinions. You can also consult with our&nbsp;<a href="https://www.biznestbazaar.com/hire-professional">professionals</a> for further assistance.

A Complete guide to buying a business in Nepal

<a href="https://www.biznestbazaar.com/sell">Franchising</a> is a business model used by entrepreneurs seeking business growth through geographical expansion. Franchising is a business format where franchisees can operate under the franchisor's established brand and system. An increasing number of franchises also indicate a good sign for the county's economy. Franchise businesses play a significant role in driving the nation's economic activity.&nbsp; According to The&nbsp;<a href="https://www.franchise.org/">International Franchising Association</a>, franchising businesses grow the country's economy and world faster than other activities.&nbsp;&nbsp;In the context of Nepal, the concept of franchise business is evolving. However, increased urbanization and changing customer preferences have increased the demand for national and&nbsp;<a href="https://www.biznestbazaar.com/blog/franchise-of-foreign-brand-business-in-context-of-nepal">international franchise brands</a> in Nepal. The increase in a franchise business has created challenges to maintain the brand standard and quality of service for the franchise business outlet in Nepal. To regulate the franchise business proper franchise law should be enacted in Nepal.&nbsp;Franchise laws would help attract national and foreign brands and investors to invest in franchise businesses in Nepal, as the legal framework provides transparency, protects their interests, and maintains a stable business environment to invest.&nbsp;&nbsp;Before exploring the importance, it is important to understand the meaning of franchise law. Franchise law can be defined as the law that governs the relationship between franchisors and the franchisee. It includes the regulation of the offer and sale of franchises, disclosure documents, franchise agreements, protection of&nbsp;<a href="https://www.facebook.com/share/r/23QhhFGgEGZcTWK3/">intellectual property</a>, and dispute settlement mechanisms. A well-defined franchise law ensures the rights and obligations of the franchisor and franchisee. It also promotes transparency and trust in business transactions.&nbsp;&nbsp;The absence of a specific franchise law in Nepal creates challenges for both franchisors and franchisees. Even though Nepal’s Business laws have evolved and address the various areas of business, however, there are still notable gaps and limitations specifically regarding franchising the business.&nbsp;&nbsp;Franchises not only play an important role in the economic development of a country but also play an important role in institutional, social, and environmental development. However, this blog only explores the importance of introducing franchise law in Nepal and how it can benefit Nepal’s economy and business. They are:&nbsp;&nbsp;<h2>Job creation and entrepreneurship opportunities</h2>&nbsp;One of the most direct ways franchise businesses contribute to the economy is to create job opportunities and increase entrepreneurship opportunities. Franchise requires employees to operate, from frontline staff to management which can contribute to solving one major problem Nepal faces: the lack of Job opportunities. Franchise law establishes a safe environment for aspiring entrepreneurs to start their businesses. The expansion of franchises in Nepal can lead to significant job creation. Training and development programs provided by the franchisor to the franchisees and their employees benefit the franchise business and enhance the employment opportunities of individuals.&nbsp;&nbsp;<h2>Improved market access for local businesses.</h2>Franchisee law helps local businesses expand easily by providing a structured framework. With a clear and structured franchise legal framework, the franchise law encourages establishing and growing franchise businesses that offer several benefits to local entrepreneurs and businesses. Franchise law protects the rights of franchisees and gives local business owners the confidence to invest in franchising without fear of unfair practices. Franchise law attracts franchisees to enter the local market, creating opportunities for local businesses. It also allows local businesses to partner with well-known national and international brands and overcome barriers to market entry, increase the number of local businesses, achieve faster growth, and increase market penetration. Franchise law minimizes or lowers the risk associated with investment in local businesses.&nbsp; It ensures transparency in the investment and encourages investors to invest in franchising local businesses. It makes it easier for local businesses to access the capital needed for expansion.&nbsp;&nbsp;<h2>Attraction of Foreign Franchises and Investment</h2>&nbsp;Clear franchise law helps to attract international franchise brands and investors to Nepal, as they feel confident about investing in Nepal. Franchise law provides legal certainty and stability to foreign investors and franchises that their business operations will be protected. Foreign investors are more likely to trust Nepal’s market with clear rules and regulations regarding the&nbsp;<a href="https://www.biznestbazaar.com/blog/franchise-agreement-15-essentials-you-need-to-know">franchise business</a>. This legal certainty, stability, trust, and confidence leads to an increase in foreign direct investment. They will not only bring capital but bring expertise, and new business models that contribute to economic growth. A well-defined franchise law simplifies foreign franchisors with the process of bringing foreign investment. Franchise law encourages foreign investors (franchisors) to partner and collaborate with local entrepreneurs (franchisees), allows foreign investors to use knowledge of Nepal’s market and customer preferences from the local entrepreneurs, and local entrepreneurs get the benefit of brand recognition, training, and other support from the franchisor. With the entry of foreign franchises, it creates a competitive environment as it brings innovative products, services, and business practices. This leads to improved quality, efficiency, and productivity among local businesses.&nbsp;&nbsp;<h2>Facilitating Market Expansion&nbsp;</h2>&nbsp;Franchise law encourages investors to establishment of franchises or invest in franchise business as it makes secured of their investment. Franchise law simplifies the process of franchising, and registration of franchise businesses accelerates on expansion of the franchise business and boosts economic activities as more franchise outlets open, generate revenue, and create jobs.&nbsp; With the expansion of franchise outlets, it increased the demand for products and services. Franchise law ensures that the expansion is regulated and sustainable. It promotes steady economic growth. Franchise law can facilitate the franchise business encourage to expand of business beyond major cities, and create economic opportunities beyond major cities. With the support of franchise law, businesses can adopt successful franchising models, increasing their competitiveness in the market.&nbsp;&nbsp;<h2>Increase Tax Revenue</h2>&nbsp;Franchise law has a crucial role in generating tax revenue. Franchise law creates a favorable environment for the franchise business to expand its outlets. The increase in the number of franchises increases the overall business activity in Nepal leading to higher revenue for franchise businesses. With the higher revenue, the franchise is obliged to pay higher taxes. Franchise law helps ensure franchises are registered and all franchises operate under a regulated framework. Franchise law makes franchisees comply with the tax and reduces the untaxed economy. The law mandates transparent regular financial reporting and makes sure the financial practices are transparent and under the law. This leads franchises to pay the appropriate tax. It helps to reduce tax evasion and increases the overall tax revenue collected by the government. The increased tax revenue generated from the growth of franchises can be used to fund essential public services and infrastructure projects. Reinvested into public services and infrastructure projects enhances the business environment, attracts investment, and drives further economic growth.&nbsp;&nbsp;&nbsp;<h2>Facilitate Market Expansion&nbsp;</h2>&nbsp;Franchise law enables franchises to open new outlets more quickly and efficiently in multiple locations, increasing economic activity, generating revenue, and creating jobs. Franchises can do this because they have a proven business model that they can replicate in the new market.&nbsp; A well-defined franchise law makes it easy to enter Nepal's market and reduce administrative barriers and regulatory complexities. This attracts more entrepreneurs to consider franchising as a good step to expand the business. Franchise law enables businesses to increase competition in the market. It also helps to transfer technology between different parts of the world, ultimately promoting economic growth. As the franchises bring innovation, high standards, and new technology local businesses are encouraged to improve their goods and services. That competitive environment benefits consumers and stimulates economic activity.&nbsp;&nbsp;Franchise law plays a pivotal role in Nepal's economic growth. A structured franchise law facilitates job creation and entrepreneurship opportunities, addresses the problem of unemployment, and promotes franchise business. It improved the market access for local businesses and ensured franchises expand easily. Further, Franchise law attracts foreign franchises and investments that not only bring capital but also bring technology, expertise, and innovative business models and create a competitive market environment. It also encourages foreign investors to collaborate with local entrepreneurs. It creates a favorable environment for business growth, attracts investments, and generates tax revenue. Franchise law strengthens the overall business ecosystem and drives economic development.&nbsp;&nbsp;Also read:&nbsp; <a href="https://www.biznestbazaar.com/blog/company-registration-process-in-nepal">Company Registration Process in Nepal</a>&nbsp;Disclaimer: The information provided here is for informational purposes only and should not be considered as legal advice. Please consult with a qualified legal expert for professional legal opinions. You can also consult with our&nbsp;<a href="https://www.biznestbazaar.com/hire-professional">professionals</a> for further assistance.

Role of Franchise Law in Boosting the Nepal

Lately,the import and export business has been the fastest growing service sector in Nepal. The excessive import and export has pulled the business person to invest . The import and export&nbsp; business means a business relating to providing services to the consumers.&nbsp;Being an entrepreneur, if you want to&nbsp;<a href="https://www.biznestbazaar.com/buy-a-business">invest in the business</a> of import and export, then it can be registered as sole proprietorship (private firm) and company and industry.&nbsp;Kindly go through this link for further more information on sole proprietorship (private firm) registration process:&nbsp;&nbsp;<a href="https://www.biznestbazaar.com/blog/how-to-register-a-trading-business-private-firm-in-nepal">Biznest Bazaar | How to register a Trading Business (Private Firm) in Nepal?</a>&nbsp;&nbsp;Kindly go through this link for further more information on industry registration process:&nbsp;&nbsp;<a href="https://www.biznestbazaar.com/blog/industry-registration-process-in-nepal">Biznest Bazaar | Industry Registration Process in Nepal</a>&nbsp;Exim Code, stands for&nbsp;Export and Import Code. The code is issued by the&nbsp;<a href="https://www.customs.gov.np/">Department of Customs</a>,&nbsp;<a href="https://www.mof.gov.np/">Ministry of Finance</a>. It is the 13 digit government identification number to make the export and import process efficient and valid. It aims to regulate international trade.&nbsp;Lately, import and export has been increased in different aspects like importing raw materials, electronics, etc. So for the purpose of importing and exporting goods and materials, the Exim code is important. If you have no idea on how a business or manufacturer or goods gets the Exim code then this blog will give you a comprehensive idea on the registration process of Exim Code.Governing Laws:&nbsp;<ol><li><a href="https://cn.nepalembassy.gov.np/wp-content/uploads/2017/11/customs-act-2064-2007.pdf">Custom Act 2064</a> &nbsp;</li><li><a href="https://nepaltradeportal.gov.np/resources/docs/customs-rules-2065-2007.pdf">Custom Rules, 2065</a> &nbsp;</li><li><a href="https://customs.gov.np/storage/DoC/2079-80/Miscellaneous/%E0%A4%A8%E0%A4%BF%E0%A4%95%E0%A4%BE%E0%A4%B8%E0%A5%80%20%E0%A4%B5%E0%A4%BE%20%E0%A4%AA%E0%A5%88%E0%A4%A0%E0%A4%BE%E0%A4%B0%E0%A5%80%20%E0%A4%B8%E0%A4%99%E0%A5%8D%E0%A4%95%E0%A5%87%E0%A4%A4%20%E0%A4%A8%E0%A4%AE%E0%A5%8D%E0%A4%AC%E0%A4%B0%20%E0%A4%AA%E0%A5%8D%E0%A4%B0%E0%A4%A6%E0%A4%BE%E0%A4%A8%20%E0%A4%97%E0%A4%B0%E0%A5%8D%E0%A4%A8%E0%A5%87%20%E0%A4%95%E0%A4%BE%E0%A4%B0%E0%A5%8D%E0%A4%AF%E0%A4%B5%E0%A4%BF%E0%A4%A7%E0%A4%BF%202079%20Final.pdf">Procedure for providing EXIM code 2079</a></li></ol>&nbsp;&nbsp;Also read:&nbsp;<a href="https://www.biznestbazaar.com/blog/a-comprehensive-guide-to-securing-startup-funding-in-nepal">A Comprehensive Guide to Securing Startup Funding in Nepal</a><h2>&nbsp;</h2><h2>Steps on registering Exim Code</h2><h2>&nbsp;</h2><h2>Step 1: Register the username in IMIS</h2>&nbsp;To create the username visit the link and register the user name.&nbsp;&nbsp;<a href="http://110.34.28.82:8484/user-registration">Get Submission Number</a>&nbsp;&nbsp;After you go through this link you will view the following page.&nbsp;<img src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXd-7mgWXLHpJvdhBdj2I1x6HyW7YTyn_igSxUpgY3wkvTyRwaUGwbl30LuJcX9NoSU8zYo1kkHGSiVqlHq8eUSlO8038pcVpfwqa-FWcuSqOZb-noXgn3X2hmC7ZDPQrTnmUVls9vBl4AlQtB-qjIDOIgvotwF6-4MnpcvEKTVN-EC6bkFKkw?key=vWJWwvTQcx5fmwfUJ4xiow">&nbsp;&nbsp;You have to make sure to use your phone number and email address. You will get the submission number after filling it, keep it securely.<h2>&nbsp;</h2><h2>Step 2: Fill the details and upload documents</h2>&nbsp;After registration you will get a submission number and the other side of filing space will be available as application registration.&nbsp;&nbsp;<img src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXeN1HJpe6kWbtt8GXpyP1g0qFoCnaq6Xx3JmoF2NrM0Y1VTYuXxiXMIa4GbTrQwiHaxLk7t1ndjLA99YJoG1qzPUeZlIgoBQNBdRbCaIoX2sUnS3k8T0BhV1l62moBg7q_dPI-bEurNR16Y9yO4HnAKYrNh-LoSn9Em2oJHcCzCu85d-Q2PoXw?key=vWJWwvTQcx5fmwfUJ4xiow" alt="C:\Users\Dell\AppData\Local\Microsoft\Windows\INetCache\Content.Word\app 1.png"><img src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXdLFmLYzkUwkBzJ8L8rt4szpOCRbH83is4rTJPPQGIksnuQdCWvf50d84zHBhQCokBCjTgxWbc8xFPvv3WAzyUdWF0y1S4yN5sgtfn4wl1N8WovdvdzcxLB3TCVyS61rOQln8t2cFbhzdVro5T2Bwz1zTU_rpBMVta_2NYQoE-Xf-XuEMlZRBw?key=vWJWwvTQcx5fmwfUJ4xiow"><img src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfFT2PxTJgMOcogMROm5Ehvm9RSY9ELTnVoG-4ta4yHIR8wjIBLJHtj4LM09e92qAZH21LlGzvDrwALqvMjQiaNS-x6VofEwJBqnDvEcsHhHxHxr5f3GOnAEtDmlPMd7x1xUBV60F_kF-ZMrDSf4alcjpCev3mWKuH8c9QlXf-u9D2IeWTfVi0?key=vWJWwvTQcx5fmwfUJ4xiow"><img src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfzNu-iw7ZoxDu46Jl-pDKKD0v8jyvvJfcnTLt1c5NCLS_B7RY43v6K5QdBtGLUIsmjFtMpXRHp9di7wSxkDINu30tkgwTdkJuKmvSVDkpKBz9f1tuoKyAjhFrXGXN-0FEmQ2gClmQZn9kCDyXFLuECOV6wQultuDwcxm7hiKwCbq2Wz5G8B_8?key=vWJWwvTQcx5fmwfUJ4xiow"><img src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXeWyjrjHhDV97ApW2nGFPkJU4FjvGVsdNKgIDIMytAkuAhP8jUhJ-aJM7y4ChppK8MRgUmlI7D16fkw_HICdHjG521X2v-rZvXJHmR0qMwPXR8EuBZd_tBnFFFPTIZPw0xo5tZAZXTSbAN95Wa_OUCcyVATI8b_idTHqfCI4z_6vYCJyq729Q?key=vWJWwvTQcx5fmwfUJ4xiow"><h3>&nbsp;</h3><h3>The list of documents needed are&nbsp;</h3>&nbsp;<ol><li>Company/ firm/. Industry who are willing to get EXIM code must:&nbsp;</li></ol>(i) Registered under the Department of Commerce, Supplies and Consumer Protection for export or import;&nbsp;&nbsp;(ii) Obtained licence for direct sale and distribution of goods from the Department of Commerce, Supplies and Consumer Protection under the Direct Sale of Goods ( Management and Regulation) Act, 2074; or&nbsp;(iii) In case of industry, registered under the Department of Industry, Government of Nepal by the Industrial Enterprises Act, 2076; or&nbsp;(iv)&nbsp; Registered in the relevant body and received a recommendation from the Department of Industry, Government of Nepal to obtain EXIM Code.&nbsp;2. Meets the minimum paid-up capital requirement;&nbsp;3. Obtained PAN (Permanent Account Number) certificate;&nbsp;4. Registered under VAT (Value Added Tax) in case of import of goods subject to value added tax; and&nbsp;5. No arrears of tax is required to be paid to the Government of Nepal.&nbsp;Also read:&nbsp;<a href="https://www.biznestbazaar.com/blog/franchise-agreement-15-essentials-you-need-to-know">Franchise Agreement: 15 Essentials You Need to Know</a>&nbsp;<h2>Step 3: Verification of Document by Department of Customs Office</h2>&nbsp;The office examines and verifies the documents uploaded.&nbsp;&nbsp;&nbsp;The uploaded document must include:&nbsp;<ol><li>Copy of the certificate and recommendation</li><li>Copy of certificate proving that the company/firm/industry meets minimum paid-up capital requirement; (Not required if involved in export only)</li><li>Copy of PAN certificate;</li><li>Tax clearance certificate issued by the office under the&nbsp;<a href="https://ird.gov.np/">Inland Revenue Department</a> where no arrears of tax are due;</li><li>Minimum 1 year of bank Guarantee of NPR 3, 00,000 (Nepalese Rupees Three Lakhs) from the Commercial Bank (A-Grade); (Not required if involved in export only)</li><li>Recommendation letter from the bank in the prescribed format where the applicant has a bank account; (Not required if involved in export only)</li><li>One recent passport-size photo of a person, proprietor, or head of the company.</li></ol>&nbsp;Note: All the documents must be scanned and uploaded on the official website of the Department of Customs.<h2>&nbsp;</h2><h2>Step 4: Issuance of EXIM code by Department of Custom office&nbsp;</h2>&nbsp;After the examination of all the documents, if it is deemed appropriate to provide a reference number, the department will issue the reference number within seven working days of receiving the application and will provide notification to the applicant through electronic means. However, a single individual will not be provided with more than one reference number.<h2>&nbsp;</h2><h2>Step 5: Receiving EXIM code certificate from Department of Customs</h2>&nbsp;The applicant will get the certificate of EXIM code registration. The applicant can obtain such a certificate by printing it themselves using a confidential code through the system, or they can collect it in person by visiting the department.&nbsp;&nbsp;Disclaimer:&nbsp;The information provided here is for informational purposes only and should not be considered as legal advice. Please consult with a qualified legal expert for professional legal opinions. You can also consult with our&nbsp;<a href="https://www.biznestbazaar.com/hire-professional">professionals</a> for further assistance.&nbsp;Also read:&nbsp;<a href="https://www.biznestbazaar.com/blog/advantage-of-buying-registered-business-in-nepal">Advantage of Buying Registered Business in Nepal</a>&nbsp;&nbsp;&nbsp;&nbsp;

Exim Code Registration Process

Foreign Direct Investment is a category of cross-border investment in which an investor resident in one country establishes a lasting interest in a significant degree of influence over an enterprise resident in another country. FDI has made it easier to transfer technology across borders.&nbsp; FDI in Nepal is governed by The Foreign Investment and Technology Transfer Act, 2019, requires preliminary approval from the&nbsp;<a href="https://doind.gov.np/">Department of Industry</a> /&nbsp;<a href="https://ibn.gov.np/">Investment Board Nepal</a> followed by final approval by Nepal Rastra Bank.&nbsp;Being a foreign investor you are interested in investing in Nepal through technology transfer but do not know the process of bringing FDI in Nepal then this blog will guide you through. This blog will be mainly focused on bringing FDI via technology transfer.&nbsp;&nbsp;If you are interested in the overall process of FDI in Nepal you can read our blog on “<a href="https://www.biznestbazaar.com/blog/process-of-foreign-direct-investment-fdi-in-nepal">Process of Foreign Direct Investment (FDI) in Nepal</a>”.&nbsp;&nbsp;We also have a blog on bringing&nbsp;<a href="https://www.biznestbazaar.com/blog/foreign-direct-investment-via-loan">Foreign Direct Investment via loan</a> and through the&nbsp;<a href="https://www.biznestbazaar.com/blog/how-to-bring-fdi-in-nepal-through-the-purchase-of-share">purchase of shares</a>, which you can read if you are interested.&nbsp;<h2>Governing Authority</h2>&nbsp;Department of Industry:&nbsp; Foreign Investment not exceeding Six Billion Rupees. (NRP 6 Arba)&nbsp;Investment Board: Foreign Investment exceeding Six Billion Rupees. (NRP more than 6 Arba)&nbsp;Nepal Rastra Bank (Foreign Exchange Management Department)&nbsp;<h2>Governing Laws</h2>&nbsp;The Foreign Investment and Technology Transfer Act, 2075 (2019) (<a href="https://www.lawcommission.gov.np/en/wp-content/uploads/2019/09/The-Foreign-Investment-and-Technology-Transfer-Act-2019-2075.pdf">FITTA</a>)&nbsp;Foreign Investment and Technology Transfer Regulation, 2077 (<a href="https://pkf.trunco.com.np/files/publications/1657093161_FITTA%20Report%202021%20JAN_20210122122451.pdf">FITTR</a>)&nbsp;Public Private Partnership and Investment Act, 2019 (<a href="https://ibn.gov.np/uploads/documents/public-private-partnership-and-investment-act-ppp-and-investment-act-2019pdf-1483-330-1657605913.pdf">PPPIA</a>)&nbsp;Nepal Rastra Bank Foreign Investment and Loan Management by Laws 2078 (<a href="https://www.nrb.org.np/contents/uploads/2022/01/FXMD-Circular19_2078.79_NRB-Foreign-Investment-and-Loan-Mgt-Bylaw-2078-amend.pdf">NRB FILM</a>)&nbsp;Industrial Enterprise Act, 2076 (<a href="https://nwedcpl.com/wp-content/uploads/2021/04/Industrial-Enterprises-Act-2020.pdf">IEA</a>)&nbsp;Also read:&nbsp;<a href="https://www.biznestbazaar.com/blog/industry-registration-process-in-nepal">Industry Registration Process In Nepal</a><h2>&nbsp;</h2><h2>Process of Foreign Direct Investment</h2><h2>&nbsp;</h2><h3>Step 1 :Register the user Name in IMIS</h3>&nbsp;To create a new user name, visit the link&nbsp;<a href="https://imis.doind.gov.np/#/auth/register">Department Of Industry</a>&nbsp; to register the user’s name.&nbsp; After you go through the link, you will view the following page:<figure class="image"><img src="https://api-v1.biznestbazaar.com/public/blog_media/1_otcg572.png"></figure>You have to make sure to use your phone number and email address. After you fill in all the information you will get an email in your email follow all the instructions as given in the email and change password. After the change of password, login again.&nbsp;<h2>&nbsp;</h2><h3>Step 2: Fill the details and upload the documents</h3><figure class="image"><img src="https://api-v1.biznestbazaar.com/public/blog_media/2_2ApxXy2.png"></figure>&nbsp;You need to click on the icon of Technology Transfer Agreement (प्रविधि हस्तान्तरण सम्झौता), then click on the green icon of (नयाँ प्रविधी हस्तान्तरण)&nbsp;on the right side of the screen and fill the detail.<figure class="image"><img src="https://api-v1.biznestbazaar.com/public/blog_media/3_qXFmwv8.png"></figure><h3>Step 3: FDI Approval in DOI or IBN</h3>&nbsp;To get FDI approval, you must apply along with the necessary documents in the DOI or IBN:&nbsp;<ol><li>Project proposal - 2 copies &nbsp;</li><li>Joint Venture Agreement (in case of more than 1 investor) &nbsp;</li><li><a href="https://notarynepal.com/services/legal-documents-notarization-in-nepal#:~:text=How%20Does%20Online%20Notarization%20Work,%2C%20bank%20transfer%2C%20or%20cash.">Notarized</a> copy of citizenship certificate of local partner or Certificate of Incorporation, Memorandum of Association and Articles if the local party is a company – 1 copy &nbsp;</li><li>Notarized copy of passport of foreign partner or Certificate of Incorporation, Memorandum of Association and Articles of Association, if the foreign party is a company– 1 copy &nbsp;</li><li>Bio data of foreign investor or company profile – 1 copy &nbsp;</li><li>Financial Credibility Certificate issued by a bank of the foreign investor’s country &nbsp;</li><li>Letter of Authorization from the investor (if necessary)</li></ol><h2>&nbsp;</h2><h3>Step 4: FDI Approval from NRB&nbsp;</h3>&nbsp;For the purpose of transferring technology, it should get approval from the NRB before bringing technology to Nepal. Investors must apply in NRB with an application and necessary documents to get the approval to bring FDI to Nepal for loans.<h3>&nbsp;</h3><h4>Application Sample:&nbsp;</h4>&nbsp;<a href="https://drive.google.com/file/d/10U42jFF4GVpo6-O7Wh4yzEeLxESV14P9/view?usp=drive_link">विदेशी मुद्रा भित्र्याउनुपूर्व राष्ट्र बैंकलाई दिइने लिखित जानकार</a>&nbsp;<h3>Step 5:&nbsp; Prior notification to be given to Nepal Rastra Bank before bringing FDI in Nepal</h3>&nbsp;Notification shall be given to NRB before bringing FDI, while notifying you must submit the listed documents listed below:&nbsp;&nbsp;<a href="https://drive.google.com/file/d/1-HBwl7d3cxbHoAu12YgShMirXRplDXpw/view?usp=drive_link">Notification shall be given to NRB before bringing FDI</a>&nbsp;<h4>Application Sample:</h4>&nbsp;<a href="https://drive.google.com/file/d/10U42jFF4GVpo6-O7Wh4yzEeLxESV14P9/view?usp=drive_link">विदेशी मुद्रा भित्र्याउनुपूर्व राष्ट्र बैंकलाई दिइने लिखित जानकार&nbsp;</a>&nbsp;<h3>Step 6: Recording of FDI in NRB after investment or bringing FDI in Nepal</h3>&nbsp;Recording of FDI is must in NRB after bringing FDI or after investment.&nbsp; You must submit the application with the necessary document listed mentioned below:&nbsp;&nbsp;<ol><li>Copy of the decision of the&nbsp;<a href="https://www.investopedia.com/terms/b/boardofdirectors.asp#:~:text=What%20Is%20a%20Board%20of,have%20a%20board%20of%20directors.">Board of Directors</a> or authorised officer regarding investment accounting, or application from the relevant foreign investor/person or institution authorised by them. &nbsp;</li><li>Copy of foreign investment approval. &nbsp;</li><li>Copy of company/industry registration certificate. &nbsp;</li><li>Copy of business operation licence (as required). &nbsp;</li><li>Copy of Permanent Account Number (<a href="https://nepaltradeportal.gov.np/register-pan/vat">PAN</a>) certificate. &nbsp;</li><li>Copy of Memorandum and Articles of Association. &nbsp;</li><li>Copy of the latest audit report. &nbsp;</li><li>Copy of proof of latest tax clearance or tax return submission. &nbsp;</li><li>Copy of updated shareholder registration list from the Office of Company Registrar (for companies listed on the securities market, share register certified by a licensed share registrar from the Securities Board). &nbsp;</li><li>Certificate issued by the relevant bank and financial institution regarding the entry of foreign currency into Nepal as foreign investment, and SWIFT message proof. &nbsp;</li><li>Certified copy of foreign investment agreement and approved share purchase-sale agreement (as needed). &nbsp;</li><li>Proof of approval provided by the central bank to bring in foreign currency for foreign investment, or support-approval of foreign investment, or evidence of prior notification as per rules.</li></ol>&nbsp;<h4>For foreign investor institutions</h4>&nbsp;<ol><li>Certified copy of institution registration certificate. &nbsp;</li><li>Certified copy of the latest audit report (However, audit report is not mandatory for investments less than USD 1 million or equivalent foreign currency. Similarly, if financial statements prepared by the Board of Directors/senior management are attached with proof that the financial statements submitted by the foreign investor do not need to be audited, an audit report is not mandatory). &nbsp;</li><li>Certified copy of documents revealing the identity of the real owner (not required for companies listed on the Securities Board). &nbsp;</li><li>Certified copy of the decision of the Board of Directors or authorised officer regarding foreign investment in Nepal.</li></ol>&nbsp;<h4>For foreign investors who are natural persons</h4>&nbsp;<ol><li>Certified copy of passport.</li></ol>&nbsp;However, for non-resident Nepalis investing in Nepal through an investment company established in joint investment with the Government of Nepal and non-resident Nepalis, a certified copy of the passport is not required if a list of investors is received through such investment company (with self-declaration of full responsibility by the Board of Directors or authorised officer as per the board's decision, unless otherwise stated) including details such as name, passport number, issuing country, address, country from which amount was brought in, etc.&nbsp;Note:&nbsp;'Certified' means notarized. The applicant must be an authorised officer.For foreign investments made through stock market purchase in listed companies/industries as per prevailing laws, if documents proving this are submitted.&nbsp;&nbsp;<h4>Application Sample:</h4>&nbsp;<a href="https://drive.google.com/file/d/10HT0skAgq_qoRk_Qb1Xfb8gqRHK2IZND/view?usp=drive_link">Application to record foreign investmnet.pdf</a>&nbsp;&nbsp;File listed document that needs to be submitted in NRB to record FDI if FDI is brought without prior approval of NRB.<a href="https://drive.google.com/file/d/18irikjBGx1M9xqIY2ECC3VCxE1f4OsHo/view?usp=sharing">approval.pdf</a>&nbsp;<h4>Application Sample:</h4>&nbsp;<a href="https://drive.google.com/file/d/1TD4sKDCOEiOkXOjzW8tPJoda_YZQhb3r/view?usp=drive_link">Application to Ratification-Cum-Record of Foreign Investment.pdf</a>&nbsp;&nbsp;File listed document that needs to be submitted in NRB to record FDI if FDI is brought without prior approval of NRB.&nbsp;<a href="https://drive.google.com/file/d/1OPWDaHXVcbHncdr9xjfZ0_VUFIuwErMo/view?usp=drive_link">brought without prior approval of NRB..pdf</a> &nbsp;<h3>&nbsp;</h3><h4>Application Sample</h4>&nbsp;<a href="https://drive.google.com/file/d/1e2mW1SQ9TxYGSsChkqwXmlCyAlTQ6khj/view?usp=drive_link">Application Sample.pdf</a>&nbsp;<h2>&nbsp;</h2><h3>Step 7:&nbsp;Recording in DOI/ IBN after transfer of technology</h3>&nbsp;The application must be submitted along with the documents in DOI/IBN where you get approval to bring FDI. The list of documents is as follows:&nbsp;<ol><li>Technology Transfer Agreement – 3 copies &nbsp;</li><li>Notarized copies of Certificate of Incorporation, Memorandum of Association and Articles of Association of the domestic company – 1 copy &nbsp;</li><li>Notarized copy of the passport of foreign investor or Certificate of Incorporation, Memorandum of Association and Articles of Association if the foreign party is a company – 1 copy &nbsp;</li><li>Foreign investor’s Bio-Data or company profile &nbsp;</li><li>Minutes of the meeting of Board of Directors from concerned companies for Technology Transfer &nbsp;</li><li>Letter of Authorization from the company &nbsp;</li><li>Notarized copy of current Audit Report and Tax Clearance Certificate of the domestic company</li></ol>&nbsp;Also read:&nbsp; <a href="https://www.biznestbazaar.com/blog/company-registration-process-in-nepal">Company Registration Process in Nepal</a>&nbsp;Disclaimer: The information provided here is for informational purposes only and should not be considered as legal advice. Please consult with a qualified legal expert for professional legal opinions. You can also consult with our&nbsp;<a href="https://www.biznestbazaar.com/hire-professional">professionals</a> for further assistance.

Foreign Direct Investment via Technology Transfer

Foreign Direct Investment is a category of cross-border investment in which an investor resident in one country establishes a lasting interest in a significant degree of influence over an enterprise resident in another country.&nbsp;<a href="https://www.biznestbazaar.com/blog/process-of-foreign-direct-investment-fdi-in-nepal">&nbsp;FDI in Nepal</a> is governed by The Foreign Investment and Technology Transfer Act, 2019 , requires preliminary approval from the Department of Industry/ Investment Board Nepal followed by final approval by Nepal Rastra Bank.&nbsp;Being an foreign investor you are interested in investing in Nepal but do not know the process of bringing FDI in Nepal then this blog will guide you through. This blog will be mainly focused on bringing FDI via loan. If you want more detailed information regarding bringing FDI in nepal read our blog “<a href="https://www.biznestbazaar.com/blog/process-of-foreign-direct-investment-fdi-in-nepal">Process of FDI in Nepal&nbsp;</a>”&nbsp;<h2>Governing Authority</h2>&nbsp;Department of Industry:&nbsp; Foreign Investment not exceeding Six Billion Rupees. (NRP 6 Arba)&nbsp;Investment Board: Foreign Investment exceeding Six Billion Rupees. (NRP more than 6 Arba)&nbsp;Nepal Rastra Bank (Foreign Exchange Management Department)&nbsp;&nbsp;<h2>Governing Laws</h2>&nbsp;The Foreign Investment and Technology Transfer Act, 2075 (2019) (<a href="https://www.lawcommission.gov.np/en/wp-content/uploads/2019/09/The-Foreign-Investment-and-Technology-Transfer-Act-2019-2075.pdf">FITTA</a>)&nbsp;Foreign Investment and Technology Transfer Regulation, 2077 (<a href="https://pkf.trunco.com.np/files/publications/1657093161_FITTA%20Report%202021%20JAN_20210122122451.pdf">FITTR</a>)&nbsp;Public Private Partnership and Investment Act, 2019 (<a href="https://ibn.gov.np/uploads/documents/public-private-partnership-and-investment-act-ppp-and-investment-act-2019pdf-1483-330-1657605913.pdf">PPPIA</a>)&nbsp;Nepal Rastra Bank Foreign Investment and Loan Management by Laws 2078 (<a href="https://www.nrb.org.np/contents/uploads/2022/01/FXMD-Circular19_2078.79_NRB-Foreign-Investment-and-Loan-Mgt-Bylaw-2078-amend.pdf">NRB FILM</a>)&nbsp;Industrial Enterprise Act, 2076 (<a href="https://nwedcpl.com/wp-content/uploads/2021/04/Industrial-Enterprises-Act-2020.pdf">IEA</a>)&nbsp;Also read:&nbsp;<a href="https://www.biznestbazaar.com/blog/how-to-bring-fdi-in-nepal-through-the-purchase-of-share">How to bring FDI in Nepal Through the Purchase of Share</a>&nbsp;<h2>Process of Foreign Direct Investment</h2>&nbsp;<h3>Step 1: Register the user Name in IMIS</h3>&nbsp;To create a new user name, visit the link<a href="https://imis.doind.gov.np/#/auth/register">&nbsp;https://imis.doind.gov.np/#/auth/register</a>&nbsp; to register the user’s name.&nbsp; After you go through the link, you will view the following page:<figure class="image"><img src="https://api-v1.biznestbazaar.com/public/blog_media/registration.png"></figure>You have to make sure to use your phone number and&nbsp;email address. After you fill in all the information you will get an email in your email follow all the instructions as given in the email and change password. After the change of password, login again.<h2>&nbsp;</h2><h3>Step 2: Fill the details and upload the documents</h3><figure class="image"><img src="https://api-v1.biznestbazaar.com/public/blog_media/dashboard.png"></figure>You need to click on the icon of New foreign investment (नयाँ विदेशी लगानी), then click on the green icon of New direct investment&nbsp;(नयाँ प्रत्यक्ष लगानी)&nbsp;on the right side of the screen and fill the detail.&nbsp;You need to fill some of the information in IMIS:1)&nbsp; &nbsp; &nbsp; General Information&nbsp;(सामान्य जानकारी)2)&nbsp; &nbsp; &nbsp; Contact Details (सम्पर्क जानकारी)3)&nbsp; &nbsp; &nbsp; Shareholders&nbsp;&nbsp;(लगानिकर्ताहरू)4)&nbsp; &nbsp; &nbsp; Production/ Services (उत्पादन/सेवाहरू)5)&nbsp; &nbsp; &nbsp; Raw Materials&nbsp;(कच्चा पदार्थ)6)&nbsp; &nbsp; &nbsp; Employee Details(कर्मचारी विवरण)7)&nbsp; &nbsp; &nbsp; Equipment fuel (उपकरण ईन्धन)8)&nbsp; &nbsp; &nbsp; Machinery&nbsp;(मेशिनरी)9)&nbsp; &nbsp; &nbsp; Investment&nbsp;(लगानी)10)&nbsp; Annual Operating Cost (वार्षिक परिचालन लागत)11)&nbsp; Documents (कागजातहरू)&nbsp;Along the Shareholder Details, you must also upload the Shareholders' Citizenship, Passport size Photo, and Bio Data.&nbsp;You also need to upload other necessary documents they are:&nbsp;a)&nbsp; &nbsp; &nbsp; Loan Agreementb)&nbsp; &nbsp; &nbsp; Certificate of Incorporation, including MOA and AOA of the leading agencyc) &nbsp; &nbsp; &nbsp; Company Profile on the leading agencyd)&nbsp; &nbsp; &nbsp; Copy of minute of the Board of the recipient company regarding the loan to be acquirede)&nbsp; &nbsp; &nbsp; Authority letter from the concerned companies or individuals to carry out any necessary work on their behalf if applicable.&nbsp;<h3>Step 3: FDI Approval in DOI or IBN</h3>&nbsp;To get FDI approval, you must apply along with the necessary documents in the DOI or IBN:&nbsp;<ol><li>Project proposal - 2 copies &nbsp;</li><li>Joint Venture Agreement (in case of more than 1 investor) &nbsp;</li><li>Notarized copy of citizenship certificate of local partner or Certificate of Incorporation, Memorandum of Association and Articles if the local party is a company – 1 copy &nbsp;</li><li>Notarized copy of passport of foreign partner or Certificate of Incorporation, Memorandum of Association and Articles of Association, if the foreign party is a company– 1 copy &nbsp;</li><li>Biodata of foreign investor or company profile – 1 copy &nbsp;</li><li>Financial Credibility Certificate issued by a bank of the foreign investor’s country &nbsp;</li><li>Letter of Authorization from the investor (if necessary)</li></ol><h2>&nbsp;</h2><h3>Step 4:&nbsp; Prior notification to be given to Nepal Rastra Bank before bringing FDI in Nepal</h3>&nbsp;Notification shall be given to NRB before bringing FDI, while notifying you must submit the listed documents listed below:&nbsp;&nbsp;<ul><li><a href="https://drive.google.com/file/d/17yl0-fTr7FUAx6_glME8bhZccYuS7AKe/view?usp=drive_link">Application Form</a> &nbsp;</li><li><a href="https://docs.google.com/document/d/18FpbsThVhLe5SK62FilhQOZP8clDnY6G/edit?usp=sharing&amp;ouid=102064445062721488163&amp;rtpof=true&amp;sd=true">Prior notification to be given to Nepal Rastra Bank before bringing FDI in Nepal</a> &nbsp;</li><li>Industry Registration Certificate or document showing that the amount being remitted in industry/company is the one established for foreign investment&nbsp; &nbsp;</li><li>Copy of approval to bring foreign investment from foreign investment</li></ul>&nbsp;<h3>Step 5: Open a Bank Account</h3>&nbsp;For the purpose of bringing FDI in Nepal you should open a bank account in Class A Bank as per&nbsp;<a href="https://www.nrb.org.np/contents/uploads/2019/12/Bank_And_Financial_Instituion_Act_2017_-_English_Version_20190311-1.pdf">Banking and Financial Institutions 2073</a>.&nbsp; After all the process is finished for bringing investment you can direct your investment to the class A bank of Nepal.&nbsp;<h3>Step 6: Recording of FDI in NRB after investment or bringing FDI in Nepal</h3>&nbsp;Recording of FDI is must in NRB after bringing FDI or after investment. You must submit the application with the necessary document listed mentioned below:&nbsp;a)&nbsp; &nbsp;Copy of the foreign loan approval letter provided by the central bank,b)&nbsp; &nbsp;Copy of proof issued by banks and financial institutions regarding the entry of foreign currency into Nepal as foreign loan, and proof of System Generated ,c) &nbsp; &nbsp;Copy of the latest audit report (not required for entities listed on the securities market),d)&nbsp; &nbsp;Copy of proof of latest tax clearance or tax return submission (not required for entities listed on the securities market),e)&nbsp; &nbsp;Copy of the decision of the board of directors or authorized officer regarding the accounting of foreign loans,f) &nbsp; &nbsp;Certified copy of the loan repayment schedule (Repayment Schedule).g)&nbsp; &nbsp;Recommendation from the Ministry of Industry, Commerce and Supplies, Government of Nepal or approval letter from the relevant authority (if available).&nbsp;Note:“Certified " means notarized. The applicant must be an authorized officer. If the borrower is a natural person, documents mentioned in points 3, 4, and 5 are not required.&nbsp;Before recording the FDI, the reason behind not prior approval should be clarified and submit the documents. File listed document that needs to be submitted in NRB to record FDI if FDI is brought without&nbsp; prior approval of NRB.&nbsp;<h3>Step 7: Application to be submitted in NRB to record FDI if FDI is brought with prior approval of NRB.</h3><figure class="image"><img src="https://api-v1.biznestbazaar.com/public/blog_media/Application_to_record_foreign_investment.png"></figure>&nbsp;Before recording the FDI, the reason behind not prior approval should be clarified and submit the documents. File listed document that needs to be submitted in NRB to record FDI if FDI is brought without&nbsp; prior approval of NRB.<a href="https://docs.google.com/document/d/1ABkqrQmKNH1JTQ-36GPjkWroNYicsMCX/edit?usp=sharing&amp;ouid=102064445062721488163&amp;rtpof=true&amp;sd=true">FDI is brought with prior approval of NRB</a>&nbsp;Except the documents of number 1 point&nbsp;Application Sample:&nbsp;<a href="https://drive.google.com/file/d/1_gtqqULmroKITpcl7BiOruHCqwDVRcLm/view?usp=drive_link">FDI is brought without&nbsp; prior approval of NRB (Application)</a>&nbsp;<a href="https://docs.google.com/document/d/1ABkqrQmKNH1JTQ-36GPjkWroNYicsMCX/edit?usp=sharing&amp;ouid=102064445062721488163&amp;rtpof=true&amp;sd=true">Application to be submitted in NRB to record FDI if FDI is brought with prior approval of NRB.</a>&nbsp;<a href="https://drive.google.com/file/d/1m4oLKovKCNU83PtPPOPV11QDjrFcrafL/view?usp=drive_link">Prior notification to be given to Nepal Rastra Bank before bringing FDI in Nepal</a>&nbsp;<h2>Step 8: Recording of Transaction in DOI/ IBN after investment as loan</h2>&nbsp;The application must be submitted along with the documents in DOI/IBN where you get approval to bring FDI. The list of documents is as follows:&nbsp;a)&nbsp; &nbsp; &nbsp; Industry registration certificate and the copy of the approved project proposalb)&nbsp; &nbsp; &nbsp; Lease agreement stating clearly the time, value and payment procedure of the lease-2 copiesc) &nbsp; &nbsp; &nbsp; If the lessor is a company, company registration certification, MOA and AOA, minute of the decision of the board and Company Profile.d)&nbsp; &nbsp; &nbsp; Documents exhibiting the value of the Airplanes, Ship, Machines, Building Equipment or other devices to be given in lease.e)&nbsp; &nbsp; &nbsp; Insurance documents of the Airplanes, Ship, Machines, Building Equipment or other devices to be brought in leasef) &nbsp; &nbsp; &nbsp; Other documents as required by the investment approval agency.&nbsp;<h2>Frequently Asked Questions</h2>&nbsp;What is the validity period of approval of foreign investments?&nbsp;The approval of foreign investment given by the foreign investment approving body shall remain valid for a period until such investment remains in Nepal.&nbsp;Can a loan be borrowed or foreign currency acquired by issuing securities?&nbsp;Any public limited company incorporated in Nepal or a corporate body authorized under the prevailing law to issue securities may, with the approval of the&nbsp;<a href="https://www.nrb.org.np/">Nepal Rastra Bank</a> and the Securities Board, borrow a loan or acquire foreign currency by issuing bonds, debentures or other securities in the capital market of a foreign country.&nbsp;Are the operating industry granted permission for foreign investment?&nbsp;Permission may be granted to an industry in operation with foreign investment to import goods produced by its principal company abroad for a certain period on such terms and within such ceiling as prescribed, for development and promotion of market for new goods.&nbsp;Can I perform work through an electronic system?&nbsp;The central bank can also perform the tasks under this regulation using an electronic system. After the public notice of the operation of such a system is published by the central bank, the applicant must submit the application using the system as specified.&nbsp;Who is the foreign investment approving body?&nbsp;The Investment Board under the&nbsp;<a href="https://cn.nepalembassy.gov.np/wp-content/uploads/2017/11/investment-board-act-2068-2010.pdf">Investment Board Act, 2011 (2068)</a> shall approve the foreign investment exceeding six billion Rupees&nbsp;Disclaimer: The information provided here is for informational purposes only and should not be considered as legal advice. Please consult with a qualified legal expert for professional legal opinions. You can also consult with our&nbsp;<a href="https://www.biznestbazaar.com/hire-professional">professionals</a> for further assistance.

Foreign Direct Investment: Via Loan

The emerging economy of Nepal presents an opportunity for foreign investors to explore<a href="https://www.biznestbazaar.com/buy-a-franchise"> various sectors for investment</a> using convertible foreign currency. Suppose you are interested in investing in Nepal, but are unsure about the process of bringing Foreign Direct Investment (FDI) into the country. In that case, this blog will serve as a guide for bringing FDI to Nepal. The blog aims to provide comprehensive information and insights to help foreign investors navigate the process of investing in Nepal.&nbsp;&nbsp;To know the meaning of foreign direct investment and the area for FDI, and Incorporate a company through FDI in Nepal, then read the blog&nbsp;<a href="https://www.biznestbazaar.com/blog/process-of-foreign-direct-investment-fdi-in-nepal">Process of Foreign Direct Investment (FDI) in Nepal.&nbsp;</a>&nbsp;It also guides you through the process of FDI by establishing the industry and establishing branches. However, this blog will guide you through the process of FDI in Nepal through the&nbsp;Purchase of Shares.&nbsp;&nbsp;<h2>Governing Authority&nbsp;</h2>&nbsp;Department of Industry:&nbsp; Foreign Investment not exceeding Six Billion Rupees. (NRP 6 Arba)&nbsp;Investment Board:&nbsp;Foreign Investment exceeding Six Billion Rupees. (NRP more than 6 Arba)&nbsp;&nbsp;Nepal Rastra Bank (Foreign Exchange Management Department)&nbsp;&nbsp;<h2>Governing Laws</h2>&nbsp;The Foreign Investment and Technology Transfer Act, 2075 (2019)&nbsp;&nbsp;Foreign Investment and Technology Transfer Regulation, 2077&nbsp;&nbsp;Public Private Partnership and Investment Act, 2019&nbsp;Nepal Rastra Bank Foreign Investment and Loan Management by Laws 2078&nbsp;Industrial Enterprise Act, 2076&nbsp;&nbsp;Also Read:&nbsp;<a href="https://www.biznestbazaar.com/blog/industry-registration-process-in-nepal">Industry Registration Process in Nepal</a>&nbsp;<h2>Process of Foreign Direct Investment&nbsp;</h2>&nbsp;<figure class="table"><table class="ck-table-resized"><colgroup><col style="width:50%;"><col style="width:50%;"></colgroup><tbody><tr><td>Stepwise Process&nbsp;</td><td>Regulatory Authority&nbsp;</td></tr><tr><td>Register User in IMIS</td><td>DOI Website&nbsp;</td></tr><tr><td>Fill in the details and Upload the Document&nbsp;</td><td>DOI website&nbsp;</td></tr><tr><td>FDI approval</td><td>DOI or IBN</td></tr><tr><td>FDI Approval&nbsp;</td><td>NRB</td></tr><tr><td>Prior notification for bringing in FDI</td><td>NRB</td></tr><tr><td>Open Bank Account&nbsp;</td><td>A Grade Nepali Commercial Bank</td></tr><tr><td>Recording of FDI after investment</td><td>NRB (Foreign Exchange Management Department)</td></tr><tr><td>Recording of Transaction after transfer of share</td><td>DOI or IBN</td></tr></tbody></table></figure>&nbsp;&nbsp;<h2>Step 1: Register the Username in IMIS</h2>&nbsp;To create a new username, visit the DOI website or visit this link&nbsp;<a href="https://imis.doind.gov.np/#/auth/register">https://imis.doind.gov.np/#/auth/register</a> to register the user’s name. Once you click the link you will view the following page:&nbsp;<img src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXchTeGo1u1jsp5_7tn5gVR83Qg0zUNvw9r1Q2qdIQwJZtOmSWGIjcH2NFGbrq4rqdXGWYBHN5xHQ8g4YokfwOCNXmq0FzxAhJs0wFAkYHGy8J6buH05w7rHuYEOIgNg6coeyaP4u_MdmEx3G1UF3ktU54Yb6Vsgev8A67xtmn5KM79ZmyLyzwk?key=YdTCg7jKPHNePHIadMCodQ">&nbsp;&nbsp;Make sure you use your phone number and email address. Once you enter all the information, an email will be sent to your email. You need to follow the instructions of the email and change the password. Once you change your password, you need to log in.&nbsp;&nbsp;<h2>Step 2: Fill in the details and Upload the Document</h2>&nbsp;<img src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXe_RjmY_DO4oVScky4BrhaTw7EnabMLAOcWcaYCGcb4W1Wlm_WG9M0CFGguTb8zgwzZt5YyqXfoU8VUV3kyMAzKfE-4xdXYktQNDflR5-erOExdXAZdZB4EbORyaufXpfjNdDYzWaXfgjrC0I0KsAGmUROBnTz6cOIIXTXP49NZtqpSAF53cbk?key=YdTCg7jKPHNePHIadMCodQ">&nbsp;&nbsp;You need to click on the Sale and purchase agreement (शेयर खरिद सम्झौता), then click on the icon of New Share Purchase shown in the green icon on the right side of the screen and fill the detail.&nbsp;&nbsp;<img src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXc9hECxekrW9uk4JnWP_l3xIPfKsfDmhGX9NDVfhawTSfJvXKibNzwz_o0_NUzyh4Au9iOHUOZH7C3KJlL2cmQz02YYNpT7a7bnRh3c5ohH-Y4m_jYz7m_hdGgFb2WtAWHh3uqygpNfwOZZNSTBdqcHvVD__VKWmBa8-QoYxE39PHo_znCXKQ?key=YdTCg7jKPHNePHIadMCodQ">&nbsp;&nbsp;&nbsp;You need to fill in the following details in IMIS:&nbsp;&nbsp;<ul><li>Basic Information &nbsp;</li><li>Contact Information&nbsp; &nbsp;</li><li>Shareholder Details&nbsp; &nbsp;</li><li>Industry Objective &nbsp;</li><li>Proposed Investment&nbsp; &nbsp;</li><li>Proposed Raw Materials Information &nbsp;</li></ul>Proposed Human Resource Information&nbsp; &nbsp;Proposed Electricity, Utilities, and Fuel Consumption Information &nbsp;<ul><li>Machinery Information &nbsp;</li><li>Annual Operating Cost&nbsp; &nbsp;</li><li>Industry Information&nbsp; &nbsp;</li><li>Current Shareholder Detail &nbsp;</li><li>Transfer Detail&nbsp; &nbsp;</li></ul>Along with the Shareholder Details, you must also upload the Shareholders' Citizenship, Passport size Photo, and Bio Data.&nbsp;&nbsp;You also need to upload other necessary documents, they are:&nbsp;&nbsp;<ul><li>Financial Audit Report of the Last 2 Years &nbsp;</li><li>Industry Registration certificate&nbsp; &nbsp;</li><li>Minutes of the meeting of the Board of Directors of Nepali Company&nbsp; &nbsp;</li><li>Shareholders’ Agreement &nbsp;</li><li>Tax Clearance certificate</li></ul>&nbsp;Also read: <a href="https://www.biznestbazaar.com/blog/partnership-firm-registration-process-trading-business">Partnership Firm Registration Process: Trading Business</a><h2>&nbsp;</h2><h2>Step 3: FDI Approval in DOI or IBN</h2>&nbsp;To get the FDI approval, you must apply along with the necessary documents in the DOI or IBN.&nbsp; &nbsp;<ul><li>Application form for Foreign Investment&nbsp; &nbsp;</li><li>Industry Registration Certificate&nbsp; &nbsp;</li><li>Consent Letter from the shareholder if the shareholder wants to sell his/her share.&nbsp; &nbsp;</li><li>In the case of an individual seller, the seller must personally appear at the department for identification. For individuals residing abroad, they must get their identification verified and certified by the Nepali Embassy abroad and then submit it. &nbsp;</li><li>Letter of Intent to Purchase Shares&nbsp; &nbsp;</li><li>Certified copy of the meeting of the Board of Directors/Annual General Meeting of companies engaging in share purchase and sale, and the power of attorney letter authorizing official signatures on the SPA (with specimen signatures included).&nbsp; &nbsp;</li><li>Share Purchase Agreement (SPA) &nbsp;</li><li>Financial Credibility Certificate issued by Foreign Investor Bank&nbsp; &nbsp;</li><li>Certified Share Certificate (Share Lagat) by Office of Company Registration (OCR), Description of Authorized Capital, and Issued Capital, objective of the Company as per Memorandum of Association. &nbsp;</li><li>Audit Report of Fiscal Year &nbsp;</li><li>Power of Attorney if given and Sample signature of the person who is appointed as Power of Attorney.&nbsp; &nbsp;</li><li>Due Diligence Audit/ Share valuation report&nbsp; &nbsp;</li><li>If the foreign investor wants to sell the shares,&nbsp;</li></ul>&nbsp;<h3>If the Foreign Investor is an Individual&nbsp;</h3>&nbsp;<ul><li>Copy of the Passport and Bio Data.&nbsp;</li></ul>&nbsp;<h3>If the Foreign Investor is a Foreign Company</h3>&nbsp;<ul><li>Board Decision on buying shares and decision&nbsp; &nbsp;</li><li>Board decision on giving Power of Attorney &nbsp;</li><li>Memorandum of Association, Article of Association of the foreign company (English translation when required and Notary certified or notary seal) &nbsp;</li><li>Certificate of Incorporation (Notary certified or notary seal) &nbsp;</li><li>Profile of the foreign company&nbsp;</li></ul>&nbsp;<h2>Step 4: FDI approval from NRB&nbsp;</h2> To purchase the share, the foreign investor must get approval from the NRB before bringing investment in Nepal. You must apply in NRB with an application and necessary documents to get the approval to bring FDI to Nepal to purchase shares.&nbsp;&nbsp;&nbsp;To know the list of documents, that need to be submitted to NRB, click on the file shown below:&nbsp;&nbsp;However, there are certain criteria that you do not need to obtain prior approval from NRB to bring FDI in Nepal they are:&nbsp;&nbsp;<h3>Foreign investment does not reduce the shareholding ratio of total Nepali shareholders in existing Nepali industries.</h3>&nbsp;&nbsp;Foreign investment in companies listed on the stock market.&nbsp;&nbsp;Sick industries (रुगण उद्योग) as per the Industrial Enterprises Act, 2076 (2020).&nbsp;<h3>Sick industries (रुगण उद्योग)</h3>&nbsp;If an industry that has been in operation for a minimum of five years after the date of commencement of its commercial production or transaction, and in a capacity that is thirty percent or less of its installed capacity for the last three consecutive years because of a circumstance beyond control but not because of its intentional default or managerial weakness is being operated in the loss for the three consecutive years.&nbsp;&nbsp;<h2>Step 5: Prior notification to be given to Nepal Rastra Bank before bringing FDI in Nepal&nbsp;</h2>&nbsp;You need to notify NRB before bringing FDI. To notify you must submit the list of documents listed below:&nbsp;&nbsp;<ul><li>Application Form&nbsp; &nbsp;</li><li>Industry Registration Certificate or document showing that the amount being remitted in industry/company is the one established for foreign investment &nbsp;</li><li>Copy of approval to bring foreign investment from foreign investment</li></ul>&nbsp;<h3>Application Sample&nbsp;</h3>&nbsp;<img src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXeKTl3tua34uDFZyKq6Ar0WuT1kd3p713Z7rZF6blSgJ_2XBWzu_UKQpsIVAzo7XLIjgjM2DBpFdMI3UXPmUWHabIandb10CoG08n8RvRlMTJlYsJ2lv0pKV-o8c-1Kq2BGuj6CpvFIJzNpOJT33XcpsK6Zh9yCuP8a81Ez1iaXm4ORfXOwwg?key=YdTCg7jKPHNePHIadMCodQ">&nbsp;<h2>Step 6: Open a bank account</h2>&nbsp;To bring FDI, you must open a bank account in A Grade Commercial Bank of Nepal. After you fulfil all the processes, you can bring Investment in an account opened in the A-Grade Commercial Bank of Nepal.&nbsp;&nbsp;<h2>Step 7: Recording of FDI in NRB after investment or bringing FDI in Nepal&nbsp;</h2>&nbsp;You must record FDI in NRB after investment or bringing FDI in Nepal.&nbsp;You must submit the application with the necessary document listed in the file mentioned below:&nbsp;<a href="https://drive.google.com/file/d/1PvEf7QQZe-HbZ1oYeEDQxn-66Q_MpYb2/view?usp=sharing">File listed document that needs to be submitted to NRB to record FDI if FDI is brought without prior approval of NRB.</a>&nbsp;<a href="https://drive.google.com/file/d/12_frqQ8b1upl8LXgjnucdwEDJox23dbR/view?usp=sharing">File listed document that needs to be submitted in NRB to record FDI if FDI is brought with prior approval of NRB.</a>&nbsp;<h3>Application Sample</h3>&nbsp;Application to be submitted in NRB to record FDI if FDI is brought with prior approval of NRB.&nbsp;<img src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXe7xq3KUXLOEWQPnTU_XdBWBGQrmVb6uCmGRx8b1pzczsr0jMpuhGJlNGQ_YseTQ8vO3ExsmSAWQJF0oKjMNX7UQx3T6oZ2SAFXcQsNxNxY481tffWIR-xlslknZKZ7abRNtQnd9NuE2mnmFIve7xDg4JWa9T5ZRjbt8qjLhUy4M-s_a834C2s?key=YdTCg7jKPHNePHIadMCodQ">&nbsp;Application to be submitted in NRB to record FDI if FDI is brought without prior approval of NRB.&nbsp;<img src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXdmxiXkIK_NhhwOJqaA2n-scvVwUB6GPEH0jQqibkkA8xMX6lsOXTQrKwdsqOKVQkHTYmDQIkN5D-dQSjGVbrWx953iprdxLyZjrlcx23Cx3HaQuT0cxxTLh2fkWC7u7Twee-G839-Krg77W_10OsKBKjAFdokZ15STZS8_8M5aqdeur0mF5Q?key=YdTCg7jKPHNePHIadMCodQ">&nbsp;<h2>Step 8: Recording of Transaction in DOI/ IBN after transfer of share</h2>&nbsp;You need to submit the application along with the document in DOI/ IBN where you get the approval to bring FDI. The list of documents is as follows:&nbsp;&nbsp;<ul><li>Share Purchase Agreement (SPA) and certified documents showing the transactions conducted accordingly. &nbsp;</li><li>Document showing the company's per-share value certified by the auditor and a copy of the audit report. &nbsp;</li><li>If the investment obtained from the purchase, sale, or transfer of company shares is to be taken abroad, the schedule. &nbsp;</li><li>Proof that the company has paid the tax payable to the Government of Nepal as per the prevailing laws. &nbsp;</li><li>Share Lagat of the Company located in Nepal.&nbsp;</li></ul>&nbsp;&nbsp;<h2>Frequently Asked Question</h2>&nbsp;<ol><li>What is a Sale Purchase Agreement (SPA)?&nbsp;</li></ol>&nbsp;SPA is a legally binding agreement between the buyer and seller relating to selling and purchasing company shares. It outlined the terms and conditions related to the sale and purchase of shares in a company. It is essential to transfer ownership of shares. It ensures that both parties are clear of their rights and obligations during the transaction.&nbsp;&nbsp;<ol><li>What is the time limit for Recording FDI in NRB after investment or bringing FDI in Nepal?&nbsp; &nbsp;</li></ol>You must record your FDI in NRB within 6 months of investment or bringing FDI in Nepal.&nbsp;&nbsp;<ol><li>Is there any time limit to Recording Transactions in DOI/ IBN after the share transfer? &nbsp;</li></ol>Yes, you must record transactions in DOI/ IBN within 30 days of the share transaction.&nbsp;&nbsp;<ol><li>What are the benefits of bringing FDI into Nepal?</li></ol>FDI brings several benefits, including capital inflow, advanced technology, managerial expertise, job creation, and enhancement of the country's overall economic growth.&nbsp;<ol><li>What is the role of Nepal Rastra Bank (NRB) in FDI? &nbsp;</li></ol>The NRB oversees foreign exchange, supervises foreign investment registration, and ensures that money enters and leaves the country per Nepalese laws and regulations.&nbsp;<ol><li>Do I need to physically submit a document in NRB after investment or bringing FDI in Nepal?&nbsp; &nbsp;</li></ol>No, the document can be submitted electronically to the following email:&nbsp;<a href="mailto:fxmd_ossc@nrb.gov.np">fxmd_ossc@nrb.gov.np</a>.&nbsp; Disclaimer: The information provided here is for informational purposes only and should not be considered as legal advice. Please consult with a qualified legal expert for professional legal opinions. You can also consult with our&nbsp;<a href="https://www.biznestbazaar.com/hire-professional">professionals</a> for further assistance.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

How to bring FDI in Nepal Through the Purchase of Share

Process of Foreign Direct Investment (FDI) in Nepal

Lately, Tourism business has been the fastest growing&nbsp;<a href="https://www.biznestbazaar.com/buy-a-business">business sector in Nepal</a>. The excessive growth of tourists wanting to tour has pulled the trekking and travel agency to invest in the field of tourism. The Tourism Business means a business relating to guiding tourists for touring or for other purposes of traveling providing either one or several services or conveniences such as lodging, food, guide, or any other services.&nbsp;&nbsp;Being an entrepreneur, if you want to invest in the business of trekking and travel agency, then it can be registered as sole proprietorship (private firm) and company.&nbsp;If you want to register your travel and trekking agency as sole proprietorship (private firm) then kindly go through this link for further more information on sole proprietorship (private firm) registration process:&nbsp;<a href="https://www.biznestbazaar.com/blog/how-to-register-a-trading-business-private-firm-in-nepal">Biznest Bazaar | How to register a Trading Business (Private Firm) in Nepal?</a>&nbsp;&nbsp;<h2>Government Authority</h2>&nbsp;1)&nbsp;Koshi Province:&nbsp; Ministry of Tourism, Forest and Environment&nbsp;2)&nbsp;Madhesh Province: Ministry of&nbsp; Industry, Commerce, and Tourism&nbsp;3)&nbsp;Bagmati Province:&nbsp; Ministry of Culture, Tourism and Cooperatives Registers&nbsp;4)&nbsp;Gandaki Province: Ministry of Industry, Tourism, Forests and Environment&nbsp;5)&nbsp;Lumbini Province:Ministry of Industry, Tourism, Forests and Environment&nbsp;6)&nbsp;Karnali Province: Ministry of Industry, Tourism, Forests and Environment&nbsp;7)&nbsp;Sudurpaschim Province: Ministry of Industry, Tourism. Forests and Environment&nbsp;&nbsp;<h2>Steps for registering Tourism Business in Nepal</h2>&nbsp;<h2>Company Registration/ Firm : First,it should be registered as company/firm</h2>&nbsp;If you want to register your travel and trekking agency as company then kindly go through this link for further more information on company registration process:&nbsp;&nbsp;<a href="https://www.biznestbazaar.com/blog/company-registration-process-in-nepal">Biznest Bazaar | Company Registration Process in Nepal</a>&nbsp;&nbsp;If you want to register your travel and trekking agency as firm then kindly go through this link for further more information on firm registration process:&nbsp;&nbsp;<a href="https://www.biznestbazaar.com/blog/how-to-register-a-trading-business-private-firm-in-nepal">Biznest Bazaar | How to register a Trading Business (Private Firm) in Nepal?</a>&nbsp;&nbsp;&nbsp;&nbsp;The capital requirement differs according to the province.&nbsp;&nbsp;Registration fee in the respective province:&nbsp;<h3>Koshi Province&nbsp;</h3>&nbsp;Register as firm: Verification certificate of&nbsp; capital worth at least 15 lakhs and paid-up capital 7 lakh and if there is share then the photocopy of share lagat.&nbsp;Register as a company: Verification certificate of capital worth at least 25 lakhs and paid up capital 10 lakhs and photocopy of share lagat.&nbsp;<h3>Bagmati Province</h3>&nbsp;It is registered as Travel Agency and Trekking/Mountaineering Agency&nbsp;&nbsp;Register as company: Paid up capital or Capital for company in travel agency and trekking agency is Rs. 50,00,000.&nbsp;Register as firm: Paid up capital or capital for firm&nbsp; in travel agencies and trekking agencies is Rs. 25,00,000.&nbsp;At least, five lakh rupees should be kept as bank guarantee in the name of the trekking agency.&nbsp;Five lakh rupees should be kept as bank guarantee in the name of the travel agency.&nbsp;<h3>Karnali Province</h3>&nbsp;It is registered as a Travel or Trekking Agency.&nbsp;Register as firm: Capital or paid-up capital needed for firm is at least 10 Lakhs&nbsp;Register as company: Capital or paid-up capital needed for company at least 25 Lakhs&nbsp;Before taking permission to run the business you should keep 5 Lakhs as a bank guarantee in the name of the ministry.<h3>Sudurpaschim Province</h3>&nbsp;It is registered as a Travel or Trekking Agency.&nbsp;Register as firm: Capital or paid-up capital needed for firm is at least 10 Lakhs&nbsp;Register a company: Capital or paid-up capital needed for company at least 25 Lakhs&nbsp;Before taking permission to run the business you should keep 5 Lakhs as a bank guarantee in Class A Bank as per the NRB in the name of ministry.&nbsp;<h2>Register at the Department of Industry</h2>&nbsp;After registration as a company or firm, it should be registered in the department of industry. To know the further registration process of industry go through this provided link.&nbsp; (LINK)&nbsp;<h2>Apply for a Trekking and Travel License</h2>&nbsp;The Travel or trekking agencies registered as industries in the Department of Industry, required a license to operate issued by the Ministry of Culture,Tourism and Aviation. &nbsp; A travel or trekking agency, before obtaining the license, must deposit a bank guarantee in the name of the Ministry equivalent to at least five lakh rupees as security for the duration of the license.&nbsp;<h3>Must submit an application for the license</h3>&nbsp;An entrepreneur&nbsp; wishing to operate a travel or trekking agency must submit an application to the Ministry of Culture, Tourism and Civil Aviation for the license.&nbsp;Go through the link to download the form&nbsp;<a href="https://www.tourismdepartment.gov.np//files/publication_files/378.pdf">https://www.tourismdepartment.gov.np//files/publication_files/378.pdf</a>&nbsp;&nbsp;&nbsp;The founder of the company or firm must submit an application to the&nbsp;Mahashakha of Ministry of Culture, Tourism and Civil Aviation (<a href="https://www.tourism.gov.np/">MMCTC</a>) along with a ticket of Rs. 10 (ten) with the following documents:&nbsp;(a) Certified copies of the Industry Registration Certificate and Letter of Understanding (Bodhartha Patra),&nbsp;(b) For a travel agency registered as a company with the Department of Industry or Committee, a certified copy of the certificate showing a minimum paid-up capital of Rs. 5 lakhs, and for a trekking agency, a certified copy of the certificate showing a minimum paid-up capital of Rs. 3 lakhs,&nbsp;(c) A bank voucher/original receipt showing the payment of Rs. 15,000 (Fifteen Thousand) as the license fee.&nbsp;d)&nbsp; A travel or trekking agency applying for a license must, before obtaining the license, deposit a bank guarantee in the name of the Ministry equivalent to at least five lakh rupees as security for the duration of the license.&nbsp;<h2>Frequently Asked Questions</h2>&nbsp;What is the minimum capital requirement for Travel and Trekking Registration in Nepal?&nbsp;To register a Travel and Trekking Agency in Nepal, you need a capital of Rs 25 Lakh.&nbsp;Can travel and trekking services work under one agency?&nbsp;Yes, You can provide services under one agency.&nbsp;Can a foreign national register a Travel and Trekking Agency in Nepal?&nbsp;The foreign nationals can operate but should follow certain rules.&nbsp;How long does the registration process take?&nbsp;The registration process takes time which varies, duration based on factors, such as document verification and processing speed.&nbsp;When did the department should be informed about the changed name or address of the business?&nbsp;Within the 15 days of change in the name of the business or address, the department should be informed.&nbsp;Disclaimer: The information provided here is for informational purposes only and should not be considered as legal advice. Please consult with a qualified legal expert for professional legal opinions. You can also consult with our&nbsp;<a href="https://www.biznestbazaar.com/hire-professional">professionals</a> for further assistance.

Tourism Business Registration Process in Nepal

You want to establish an industry but are unaware about the legal proceedings for registration?&nbsp; An industry business can be registered as a company, partnership firm and sole proprietor.&nbsp; The&nbsp;<a href="https://www.doind.gov.np/detail/196">Industrial Enterprises Act. 2076 (2020)</a>, provides guidelines for industry registration in Nepal. The Act was promulgated to make easy, predictable, and effective management of the industrial sector in Nepal.&nbsp;<h2>What is industrial&nbsp; business?</h2>&nbsp;Industrial&nbsp; business&nbsp; means the conduct of an industrial business activity, where goods or products are produced, manufactured, deconstructed , altered, re-packaged, repaired or stored at a scale of greater than that defined by retail business.&nbsp;You may also like:&nbsp;<a href="https://www.biznestbazaar.com/blog/partnership-firm-registration-process-trading-business">Partnership Firm Registration Process: Trading Business</a>&nbsp;<h2>Classification of Industry</h2>&nbsp;The Act continues the general classification of industries based on size of investment on the fixed assets, and nature of business. The categorization of industries is further divided on the basis of nature of goods and services produced.&nbsp;<h3>On the basis of capital and assets:</h3>&nbsp;a)&nbsp; &nbsp; &nbsp; Micro Industry &nbsp;b)&nbsp; &nbsp; &nbsp; Cottage Industry &nbsp;c)&nbsp; &nbsp; &nbsp; Small Industry &nbsp;d)&nbsp; &nbsp; &nbsp; Medium Industry&nbsp;e)&nbsp; &nbsp; &nbsp; Large Industry<h3>&nbsp;</h3><h3>On the basis of nature and goods and services produced</h3>a)&nbsp; &nbsp; &nbsp; Energy-based Industry&nbsp;b)&nbsp; &nbsp; &nbsp; Manufacturing Industry&nbsp;c)&nbsp; &nbsp; &nbsp; Agriculture and forest product-based industry&nbsp;d)&nbsp; &nbsp; &nbsp; Mining Industry&nbsp;e)&nbsp; &nbsp; &nbsp; Infrastructure Industry&nbsp;f) &nbsp; &nbsp; &nbsp; Tourism Industry&nbsp;g)&nbsp; &nbsp; &nbsp; Information technology, communication technology and information dissemination technology-based industry&nbsp;<h3>Also read:&nbsp;<a href="https://www.biznestbazaar.com/blog/company-registration-process-in-nepal">Company Registration Process In Nepal</a></h3>&nbsp;<h3>Industry based on&nbsp; Information’s Technology, Communication Technology and Information Dissemination Technology</h3>&nbsp;a)&nbsp; &nbsp; &nbsp; Information Technology Industry&nbsp;b)&nbsp; &nbsp; &nbsp; Informational Technology Based Industries&nbsp;c)&nbsp; &nbsp; &nbsp; Dissemination Technology- Based Industries&nbsp;d)&nbsp; &nbsp; &nbsp; Service Industry<h3>&nbsp;</h3><h3>Service Industries</h3>&nbsp;Make an application to the&nbsp;<a href="https://doind.gov.np/">Department of Industry</a> for registration with the required form and prescribed documents. &nbsp; The federal level registration body is assigned to register, renew and regulate industries. The provincial level government is assigned to do the province level registration&nbsp; body.&nbsp;&nbsp;&nbsp;<h3>&nbsp;</h3><h3>Governing Law</h3>&nbsp;a)&nbsp; &nbsp; &nbsp; The Industrial Enterprises Act, 2076&nbsp;b)&nbsp; &nbsp; &nbsp; The Industrial Enterprise Regulation 2078&nbsp;<h2>Step to register the Industry in Nepal</h2>&nbsp;<h2>Step 1: Create an Account</h2>&nbsp;You must create an account before filing out or uploading the document form the website of the Industry Department. You can go to this link “<a href="https://imis.doind.gov.np/#/auth/login">Department Of Industry</a>” . You will view the following page:&nbsp;<img src="https://lh7-us.googleusercontent.com/docsz/AD_4nXe8NN1wrq5mif8hyzn_xJTvNoLoEWclEMuqY7qGaSdPY0kgnON_1uocfoB-vbRrq3Rfoq5GGvqN8N4MfgnBt0W0tpgU1yQ-IKRM9NdBTyVWres_t5J7WsN6vrkFCJ0F4jx6eHP2RpMnlu6mzQRw9XXaH3dd?key=9wAVYX9PHiKQY8cM_iJnEw">&nbsp;Make sure to use the same phone number that you used while making the account. After using one number, you cannot use that number to create the next account.&nbsp;<h2>Step 2: Fill the detail</h2>&nbsp;After the registration of user name, the following page will be opened:&nbsp;<img src="https://lh7-us.googleusercontent.com/docsz/AD_4nXd3ahhYDcEtCQ98DXuX8iuBoohfanr_I14kezITo37It-mhP78rywmUX7DXUdZK1-mVgIZKwFnYPcBXMrMi6GvDX_ixGZcrYxq0TIRYeW3IsHEm-QPV3Buv_INuh9TOZhrB0KZOWz59rknRS3YDD-KL4a6v?key=9wAVYX9PHiKQY8cM_iJnEw">Make sure you choose an industry. You need to fill in the details about your industry and upload the document. The list of documents required to upload are:&nbsp;<ul><li>Citizenship &nbsp;</li><li>The signature photograph taken on a white sheet &nbsp;</li><li>The certificate of approval&nbsp; &nbsp;</li><li>Rent Agreement &nbsp;</li><li>Copy of land ownership certificate &nbsp;</li><li>Self- Declaration&nbsp; Letter&nbsp; (स्वघोषणा पत्र) &nbsp;</li><li>Bank statement &nbsp;</li><li>Proof of payment made through bank</li></ul>&nbsp;<h2>Step 3: Fill the application</h2>Fill out the application form available at the Department of Industry website. Visit the link<a href="https://www.doind.gov.np/downloads"> https://www.doind.gov.np/downloads</a> to download the form. Details you need to fill in the form are:a)&nbsp; &nbsp; &nbsp; Full name of the industry&nbsp;b) &nbsp; &nbsp; &nbsp; The nature of the industry&nbsp;c)&nbsp; &nbsp; &nbsp; The classification of industry&nbsp;d)&nbsp; &nbsp; &nbsp; The place where industry will be situated&nbsp;e)&nbsp; &nbsp; &nbsp; The machinery to be employed by the industry, raw materials, auxiliary raw materials, chemicals, packaging&nbsp;f) &nbsp; &nbsp; &nbsp; The name of the industrialist<h2>&nbsp;</h2><h2>Step 4: Submission of Physical Copy at Concern Department</h2>&nbsp;After the completion of the online form, upload all the documents, you will receive the message. Screenshot the message, print it, and visit the department of industry designated by the government. The following document should be submitted:&nbsp;a)&nbsp; &nbsp; &nbsp; Application&nbsp; Form&nbsp;b)&nbsp; &nbsp; &nbsp; Citizenship&nbsp;c)&nbsp; &nbsp; &nbsp; Photos&nbsp;d)&nbsp; &nbsp; &nbsp; Recommendation letter from the concerned department&nbsp;e)&nbsp; &nbsp; &nbsp; Self- Declaration (स्वघोषणा पत्र)&nbsp;f) &nbsp; &nbsp; &nbsp; Bank Statement (स्रोत पुष्टि हुने कागजात)&nbsp;g) &nbsp; Proof of Payment made through the&nbsp; bank&nbsp;h) &nbsp; Recommendation/ Approval according to law<h2>&nbsp;</h2><h2>Step 5: Examination of Submitted Documents</h2>&nbsp;After submitting the documents the Department/ office will examine them. If the documents order is in, the registration of industry will be approved, and the Department will issue a certificate of incorporation. If the register detects an error in the documents, the Department will direct you to rectify or amend the mistake. After the correction, the department will issue a registration certificate.&nbsp;<h2>Step 6: Pay the registration Fee</h2>&nbsp;After submitting the document, you need to pay the registration fee along with the application fee of Rs 100. Registration fees vary according to the capital of your industry.&nbsp;<h2>&nbsp;</h2><h2>Registration fee for industry</h2>&nbsp;<figure class="table"><table class="ck-table-resized"><colgroup><col style="width:50%;"><col style="width:50%;"></colgroup><tbody><tr><td>Capital Investment (Rs)</td><td>Registration Fee (Rs)</td></tr><tr><td>0-100,000</td><td>1,000</td></tr><tr><td>100,001-500,000</td><td>4,500</td></tr><tr><td>500,001-2,500,000</td><td>9,500</td></tr><tr><td>2,500,001-10,000,000</td><td>16,000</td></tr><tr><td>10,000,001-20,000,000</td><td>19,000</td></tr><tr><td>20,000,001-30,000,000</td><td>22,000</td></tr><tr><td>30,000,001-40,000,000</td><td>25,000</td></tr><tr><td>40,000,001-50,000,000</td><td>28,000</td></tr><tr><td>50,000,001-60,000,000</td><td>31,000</td></tr><tr><td>60,000,001-70,000,000</td><td>34,000</td></tr><tr><td>70,000,001-80,000,000</td><td>37,000</td></tr><tr><td>80,000,001-90,000,000</td><td>40,000</td></tr><tr><td>90,000,001-100,000,000</td><td>43,000</td></tr><tr><td>100,000,001- more</td><td>43,000 plus NPR 30 per extra NPR 100,000</td></tr></tbody></table></figure><h2>&nbsp;</h2><h2>Step 7: Register of Business in Ward</h2>&nbsp;After you obtain the register certificate, you must register the industry at the local level i.e. the ward office. The documents required for the ward office are:&nbsp;a) &nbsp; &nbsp; Registration Form – Available at each ward office&nbsp;b)&nbsp; &nbsp; Rent Agreement&nbsp;c) &nbsp; &nbsp; Copies of Land owing certificate&nbsp;d)&nbsp; &nbsp; Property tax receipt&nbsp;e) &nbsp; &nbsp; Photo&nbsp;f)&nbsp; &nbsp; &nbsp; Copies of citizenship of the industrialist&nbsp;g) &nbsp; &nbsp; Certificate of Registration&nbsp;h)&nbsp; &nbsp; Additionally other documents required as per ward office or regulatory authorities.<h2>&nbsp;</h2><h2>Step 8: Register on PAN</h2>&nbsp;Next step is to register the industry with tax authorities, and must apply through the IRD website. The link to visit (authorities. You must apply through the IRD website. You can visit this link: (<a href="https://ird.gov.np/">https://ird.gov.np/</a>). After filing the online application, you need to visit the IRD office. The required documents for PAN registration process in Nepal are:&nbsp;a) &nbsp; &nbsp; PAN Application Form&nbsp;b)&nbsp; &nbsp; Copies of citizenship&nbsp;c) &nbsp; &nbsp; Rent Agreement&nbsp;d)&nbsp; &nbsp; Seal of the Business&nbsp;e) &nbsp; &nbsp; Registration certificate at local level<h2>&nbsp;</h2><h2>Frequently Asked Questions</h2>&nbsp;Who monitors and inspect the industry?&nbsp;The Ministry or industry registration body may, from time to time, monitor and inspect any industry whether it complies with this Act and the rules framed hereunder&nbsp; and the terms mentioned in the industry registration certificate.&nbsp;Who and what are the records to be managed?&nbsp;The industry registration body is responsible for safe maintenance of records related to administration of industries including registration, renewal, transmission, change in name, shifting location, increase of capacity, increase of capital, addition or change of objectives or cancellation of industries.&nbsp;How is the exemption on land ceiling provided?&nbsp;If any industry requires such land that exceeds the ceiling of land allowed under the prevailing law, the industry may make an application to the industry registration body to have exemption from the ceiling with respect to the land exceeding the ceiling.&nbsp;How approval for change of location can be obtained?&nbsp;If an industry registered for operation in a place needs to be shifted to another place for any reason, the industry shall make an application, setting out the reasons, to the industry registration body in such a form as prescribed. Provided that approval of the Department is required to shift it from one Province to another&nbsp;How can one lease the land on the ownership of the Government?&nbsp;If an industry of national priority needs a land under ownership of the Government for its operation, the industry may make an application, as prescribed, setting out the area of the land required for it, to the industry registration body for the provision of the land.&nbsp;Disclaimer: The information provided here is for informational purposes only and should not be considered as legal advice. Please consult with a qualified legal expert for professional legal opinions. You can also consult with our&nbsp;<a href="https://www.biznestbazaar.com/hire-professional">professionals</a> for further assistance.&nbsp;&nbsp;

Industry Registration Process in Nepal

<h2>Understanding Startup Entrepreneurs</h2>&nbsp;<figure class="image"><img src="https://api-v1.biznestbazaar.com/public/blog_media/9.png"></figure>&nbsp;A startup entrepreneur is an individual who initiates and develops a <a href="https://www.biznestbazaar.com/buy-a-business">new business</a> based on innovation, and high growth potential and focuses on addressing a market gap or need. These involve various aspects of consumer need, developing market aspects, creating a consumer base (consumer focus), finding problem and solution gaps, cost and benefit approaches, etc.&nbsp;&nbsp;They focus on innovation, are risk-takers, and have a clear vision about what they want to achieve and how to get there. Establishing a successful startup follows with various challenges and setbacks. So the entrepreneur must be very resilient and adaptable. Here entrepreneur should know their strength and weaknesses and overcome weaknesses by strengthening their core strength. They should be creative and resourceful in finding solutions, securing funding, and building their business.&nbsp;&nbsp;Also read:<a href="https://www.biznestbazaar.com/blog/company-registration-process-in-nepal">Company Registration Process in Nepal</a>&nbsp;<h2>Challenges Faced by Startup Entrepreneurs</h2>&nbsp;Startup focuses on rapid growth and scalability. Entrepreneur designs their business models to expand quickly and efficiently leveraging technology and innovative process. The very important focus for the success of a startup is networking. Building a <a href="https://alumni.arizona.edu/career-lab/resources/how-network-your-startup-6-tips-successful-entrpreneur">strong network</a> of mentors, advisors, investors, and industry connections is crucial for startup entrepreneurs. These relationships provide valuable guidance, support, and opportunities.&nbsp;&nbsp;In summary, a startup entrepreneur is a dynamic and driven individual who seeks to bring innovative ideas to life, overcoming obstacles and leveraging opportunities to build a successful business.&nbsp;<h2>&nbsp;</h2><h2>Startup loan</h2>&nbsp;Startup loan is a type of financing specifically designed to help a new business get off the ground. These loans can provide the necessary capital for initial expenses, and developments, such as purchasing equipment, leasing space, hiring employees, and covering operational costs.&nbsp;&nbsp;<figure class="image"><img src="https://api-v1.biznestbazaar.com/public/blog_media/10.png"></figure>&nbsp;&nbsp;There are various types of startup loans. They are:&nbsp;<ol><li>Industrial Enterprise Development Institute (IEDI) loans &nbsp;</li><li>traditional bank loans &nbsp;</li><li>microloans &nbsp;</li><li>venture capital loans and&nbsp; &nbsp;</li><li>personal loans.&nbsp;</li></ol>&nbsp;Among which IEDI is run by the Nepal Government under IEDE Act 2053.&nbsp;&nbsp;You may like this:&nbsp;<a href="https://www.biznestbazaar.com/blog/a-comprehensive-guide-to-securing-startup-funding-in-nepal">A Comprehensive Guide to Securing Startup Funding in Nepal</a>&nbsp;<h2>Loan Processing and Criteria</h2>&nbsp;During the loan processing, various aspects are noted. Creditworthiness on which lenders will evaluate personal and business <a href="https://www.investopedia.com/terms/c/credit_score.asp">credit scores</a>. Having a strong credit history can improve your chances of securing a loan and getting favorable terms.&nbsp;&nbsp;Business plan, collateral, interest rates and terms associates, repayment ability, and lender reputation are also determined during startup loan processing. A comprehensive business plan outlining the business model, market analysis, financial projections, and strategy is crucial. With a proper business plan, a lender wants to see a startup have a clear path to profitability and a high rate of success.&nbsp;&nbsp;<h2>Agriculture in Nepal</h2>&nbsp;Nepal is a landlocked country having the People’s Republic of China (PRC) and India as its neighbors. Nepal is an Agricultural Nation with 66.70% of the total population of the country associated with agricultural activities.&nbsp;&nbsp;The main agricultural products involve crops, livestock, fishery, and birds. The total contribution from agriculture to Nepal’s GDP in 2079.80 (202223) is 24.12%, of which 65.96% is from crops, 24.01% is from livestock, 8.52% from forestry and 1.51% is from fishery&nbsp;(Source: <a href="https://cbs.gov.np/wp-content/upLoads/2023/05/PPT_2023_Final.pdf">National Account Statistics of Nepal 2022/23, NSO, Nepal</a>). Nepal’s GDP contribution from 2075/76 to 2079/80 as per industry classification has been as mentioned below tables:&nbsp;<h3>Composition of Gross Domestic Product by ISIC Division (at Current Price) [in %]</h3>&nbsp;<figure class="image"><img src="https://api-v1.biznestbazaar.com/public/blog_media/7.png"></figure>&nbsp;Source: <a href="https://cbs.gov.np/wp-content/upLoads/2023/05/PPT_2023_Final.pdf">National Account Statistics of Nepal 2022/23, NSO, Nepal</a>&nbsp;<h3>Agricultural Financing in Nepal</h3>Nepal’s GDP still depends upon agricultural products and its outcome. Most of the household engaged in agriculture activities has no reach to agricultural subsidies/subsidized loan facilities. The number of households seeking loans drops significantly although the government has provided loans at subsidized interest rates to encourage the agriculture sector, whereas the amount of loans provided in the agriculture sector has increased significantly throughout the period.&nbsp;&nbsp;Total loan amounted to NRs. 18,278.40 million in 2011 to NRs. 3,88,227.30 million in 2022. Which is 2.60% in 2011 to 8.24% in 2022 of total loans provided by finance, development, and commercial banks and financial institutions. The total loan scenario by Commercial banks, Development banks &amp; Financial institution sectors from 2011 to 2022 is presented below in the table:&nbsp;&nbsp;<h3>Sector-wise loans and advances of Commercial Banks, Development banks, and Financial Institutions&nbsp;</h3>&nbsp;<figure class="image"><img src="https://api-v1.biznestbazaar.com/public/blog_media/8.png"></figure>(Source: <a href="https://www.nrb.org.np/">Nepal Rastra Bank</a>)<h2>&nbsp;</h2><h3>Challenges in Agricultural Development</h3>The number of agricultural loan takers decreased significantly over the decade, the concession given by the government in agriculture is like water poured on sand. According to the agricultural census, 2021/22 only 12% of households engaged in agriculture have taken agricultural loans. According to the Agricultural Census 2011/12, the number of households taking agricultural loans was 8,36,000 which was 22% of the total farming households at that time.&nbsp;&nbsp;The government of Nepal, Industrial Enterprise Development Institute (IEDI) has recently shortlisted 183 firms from 394 firms for startup entrepreneur loans for 2080. Details of which as per industrial category are mentioned below table:&nbsp;<figure class="table"><table><tbody><tr><td style="width:48.0pt;">S.N.</td><td style="width:145.25pt;">Industry Category</td><td style="width:152.9pt;">&nbsp;No. of companies&nbsp;</td><td style="width:58.2pt;">%</td></tr><tr><td style="width:48.0pt;">1</td><td style="width:145.25pt;">Agriculture</td><td style="width:152.9pt;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; 100.00&nbsp;</td><td style="width:58.2pt;">54.64%</td></tr><tr><td style="width:48.0pt;">2</td><td style="width:145.25pt;">Information Technology</td><td style="width:152.9pt;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;5.00&nbsp;</td><td style="width:58.2pt;">2.73%</td></tr><tr><td style="width:48.0pt;">3</td><td style="width:145.25pt;">Manufacturing</td><td style="width:152.9pt;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;46.00&nbsp;</td><td style="width:58.2pt;">25.14%</td></tr><tr><td style="width:48.0pt;">4</td><td style="width:145.25pt;">Service</td><td style="width:152.9pt;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;30.00&nbsp;</td><td style="width:58.2pt;">16.39%</td></tr><tr><td style="width:48.0pt;">5</td><td style="width:145.25pt;">Tourism</td><td style="width:152.9pt;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;1.00&nbsp;</td><td style="width:58.2pt;">0.55%</td></tr><tr><td style="width:48.0pt;">6</td><td style="width:145.25pt;">Trading</td><td style="width:152.9pt;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;1.00&nbsp;</td><td style="width:58.2pt;">0.55%</td></tr><tr><td style="width:193.25pt;" colspan="2">Total</td><td style="width:152.9pt;">&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; 183.00&nbsp;</td><td style="width:58.2pt;">100.00%</td></tr></tbody></table></figure>&nbsp;The shortlisted companies as per province are mentioned in the following table:&nbsp;<figure class="table"><table><tbody><tr><td style="width:69.0pt;">Province&nbsp;</td><td style="width:125.0pt;">No. of companies</td><td style="width:56.0pt;">%</td></tr><tr><td style="width:69.0pt;">Koshi</td><td style="width:125.0pt;">16</td><td style="width:56.0pt;">8.74%</td></tr><tr><td style="width:69.0pt;">Madhesh</td><td style="width:125.0pt;">10</td><td style="width:56.0pt;">5.46%</td></tr><tr><td style="width:69.0pt;">Bagmati</td><td style="width:125.0pt;">88</td><td style="width:56.0pt;">48.09%</td></tr><tr><td style="width:69.0pt;">Gandaki</td><td style="width:125.0pt;">9</td><td style="width:56.0pt;">4.92%</td></tr><tr><td style="width:69.0pt;">Lumbini</td><td style="width:125.0pt;">14</td><td style="width:56.0pt;">7.65%</td></tr><tr><td style="width:69.0pt;">Karnali</td><td style="width:125.0pt;">22</td><td style="width:56.0pt;">12.02%</td></tr><tr><td style="width:69.0pt;">Sudurpaschim</td><td style="width:125.0pt;">24</td><td style="width:56.0pt;">13.11%</td></tr><tr><td style="width:69.0pt;">Total</td><td style="width:125.0pt;">183</td><td style="width:56.0pt;">100.00%</td></tr></tbody></table></figure>&nbsp;Also read: <a href="https://www.biznestbazaar.com/blog/post-registration-of-private-company">post registration of private company</a>&nbsp;<h3>Government Initiatives and Policies</h3>&nbsp;The government of Nepal has focused its policy on the <a href="https://www.ssoar.info/ssoar/bitstream/handle/document/67966/ssoar-rnjds-2018-2-chaudhary-Agricultural_Policies_and_Rural_Development.pdf;jsessionid=F6A9B8EE00C1C81818A73CD67A3D927E?sequence=1">development of the agriculture industry</a> in every aspect. Increases in government expenditure towards agriculture, priorities in the fiscal budget, and subsidies loans can be seen very clearly in this sector.&nbsp;However, lack of modern agricultural knowledge, lack of modern technology, non-availability of sufficient and timely fertilizer, existence of middlemen, and high import of agricultural products from India without market study have synchronized the market and could not get the return expected.&nbsp;&nbsp;Also, there is a big gap between lenders, policymakers, and farmers could be seen. This has resulted gap between projected and actual results. The results are not parred to investment and priorities made by the government and policymakers. Policies should be made after proper and detailed study at ground levels.&nbsp;&nbsp;Only after that the result we are expecting be achieved and the agriculture industry will also be a properly developed sector in Nepal.&nbsp;

Startup Entrepreneur Loan & Agriculture in Nepal

Are you unaware about the legal proceedings on registering your trading business? A trading business can be registered as a company, partnership firm and sole proprietor. As a business person you want to register your trading business as a company then you can read our blog on the “<a href="https://www.biznestbazaar.com/blog/company-registration-process-in-nepal.">Company Registration Process of Nepal</a>”.&nbsp;Partnership firm is a business having two or more than two partners. The business is owned and operated by the partners of the firm. If you want to register your trading business (Partnership firm) in Nepal and search for the guidance then this blog will help you to gain knowledge and will provide extensive guidance through registration. Before indulging yourself into the business you need to understand the basic concept of trading business, the type of trading business and governing laws for the registration of trading business.&nbsp;<h2>What is Trading Business?</h2>&nbsp;The business that sells and buys goods to make profit. Example: Ram and Shyam are two friends. They decide to start a clothing store together while sharing profit and loss.Trading business has three forms:&nbsp;a) Business to Business (B2B)b) Business to Consumer (B2C)c) Direct to Consumer (D2C)&nbsp;<h3>Business to Business (B2B)</h3>&nbsp;The business where the transaction is done between one business to another. Example:&nbsp; Stationery Wholesalers sell stationary items in bulk to wholesalers or retailers.&nbsp;<h3>Business to Consumer (B2C)</h3>&nbsp;The business where the business sells products directly to the consumer. Example: Sales Berry a retail store sells goods to the consumer.&nbsp;<h3>Direct to Consumer (D2C)</h3>&nbsp;The business where manufacturers sell their products directly to the consumer. Example: BZY bag Manufacturer Company sells their product directly to the customers.&nbsp;You may also like: <a href="https://www.biznestbazaar.com/blog/education-consultancy-business-registration-process-in-nepal">Education Consultancy Business Registration Process in Nepal</a>&nbsp;<h2>Types of Trading Business</h2>&nbsp;<h3>&nbsp;Import/Export Trading Business</h3>&nbsp;The trading business that imports goods from the foreign market (Import) and sells those goods domestically or vice versa (Export).Example: ZXY Partnership Firm imports Samsung mobiles and distributes them within the Nepalese market for sale.&nbsp;<h3>Local Trading Business:&nbsp;</h3>&nbsp;The purchase and sale of products domestically.Example: ABC, a partnership firm, purchases goods from manufacturers of Nepal and distributes them within the Nepalese Market.&nbsp;Also read: <a href="https://www.biznestbazaar.com/blog/how-to-register-a-private-firm-in-the-department-of-small-and-cottage-industry-in-nepal">How to register a Private Firm in the Department of Cottage and Small Industry in Nepal?</a>&nbsp;<h2>Categories of Trading Business</h2>&nbsp;<figure class="image"><img src="https://api-v1.biznestbazaar.com/public/blog_media/Categories_of_Trading_Business.png"></figure><h3>&nbsp;</h3><h3>Distributor</h3>&nbsp;Distributors are those who buy products from the manufacturer and resell them to wholesalers, retailers, or the end customer. They act as intermediates between the producer, wholesaler, retailers, or the end customer.&nbsp;<h3>Wholesaler</h3>&nbsp;They buy goods from producers or distributors in bulk and sell it to consumers or the retailer.&nbsp;<h3>Retailer</h3>&nbsp;They purchase goods from a wholesaler and sell them to customers. The retailer may operate it in various forms such as physical stores, and online shops.&nbsp;<h2>Governing Authority</h2>&nbsp;<h3>Register Business related to import, export or Import/export</h3>&nbsp;<ol><li>Department of Commerce, Supply and Consumer Protection (वाणिज्य, आपूर्ति तथा उपभोक्ता संरक्षण विभाग) (Babarmahal, Kathmandu) for Bagmati and Gandaki Province. &nbsp;</li><li>Office of Commerce, Supply and Consumer Protection (वाणिज्य, आपूर्ति&nbsp;वाणिज्य, आपूर्ति&nbsp;कार्यलय)&nbsp;(Biratnagar) for Koshi Province &nbsp;</li><li>Office of Commerce, Supply and Consumer Protection (वाणिज्य, आपूर्ति&nbsp;वाणिज्य, आपूर्ति&nbsp;कार्यलय)&nbsp;(Birgunj) for Madesh Province &nbsp;</li><li>Office of Commerce, Supply and Consumer Protection (वाणिज्य, आपूर्ति&nbsp;वाणिज्य, आपूर्ति&nbsp;कार्यलय)&nbsp;(Bhairawa and Nepalgunj) for Lumbini Province. &nbsp;</li><li>Office of Commerce, Supply and Consumer Protection (वाणिज्य, आपूर्ति&nbsp;वाणिज्य, आपूर्ति&nbsp;कार्यलय)&nbsp;( Nepalgunj) for Karnali Province &nbsp;</li><li>Office of Commerce, Supply and Consumer Protection (वाणिज्य, आपूर्ति&nbsp;वाणिज्य, आपूर्ति&nbsp;कार्यलय)&nbsp;(Dhangadi) for Sudurpaschim Province</li></ol>&nbsp;<h3>Small and Cottage Industries in the concerned district</h3>&nbsp;<h4>Register local trading businesses</h4>(The name of the office may vary depending on the province. In Bagmati province, it is named as&nbsp;उद्योग तथा वाणिज्य कार्यलायLocal Government: If the capital is less than 5 lakhs for Local Trading BusinessGoverning Law<ul><li>Partnership Firm Act, 2020 B.S.</li><li>Provincial Law (For Local Trading Business)</li></ul><h3>&nbsp;</h3><h3>Step 1: Create Account</h3>&nbsp;In the first place, create an account from the website of Commerce and Supply Management. Visit the link;&nbsp;<a href="https://online.doc.gov.np/onlineuser/Login">https://online.doc.gov.np/onlineuser/Login</a> to register your user’s name. You will view the following page:&nbsp;Make sure to use the same phone number that you used while making the account. After using the phone number you cannot use the same number time to create another account. You will get the 4 digit code in your number, fill it.&nbsp;<figure class="image"><img src="https://api-v1.biznestbazaar.com/public/blog_media/fmis_login_page.png"></figure>&nbsp;<h3>Step 2: Fill the detail</h3>&nbsp;Once you register the user name, the following page will be opened:&nbsp;<figure class="image"><img src="https://api-v1.biznestbazaar.com/public/blog_media/doc_TewxfJ8.jpg"></figure>&nbsp;Make sure you choose a partnership firm. You need to fill in the details about your partnership firm and upload the document. The list of documents required to upload are:&nbsp;<ul><li>Citizenship</li><li>&nbsp;The signature photograph taken on a white sheet</li><li>Partnership deed</li><li>The approval certificates (for security, for pharmaceuticals, financial related business)</li><li>&nbsp;Rent Agreement</li><li>Copy of Land Ownership Certificate</li><li>&nbsp;Self- Declaration&nbsp; Letter&nbsp;&nbsp;(स्वघोषणा पत्र)</li><li>&nbsp;Bank Statement</li><li>Proof of Payment made through bank</li></ul>&nbsp;<h3>Step 3: Fill the application</h3>&nbsp;The next step is filling out the application form of the Department of Commerce and Supply Management website. Visit the link<a href="https://doc.gov.np/Downloads">&nbsp;https://doc.gov.np/Downloads</a> to download the form. Details you need to fill in the form are:a)&nbsp; &nbsp;Full name of the firmb)&nbsp; &nbsp;The principal place of business of the firmc) &nbsp; The objective of the firm including the short description of the nature of the goods or servicesd)&nbsp; &nbsp;The full name, surname and permanent address of the partnerse) &nbsp;The matter of restriction imposed on the power of a partner, if any,f)&nbsp; &nbsp;The types of partnership and the capital; subscribed by each partnersg) &nbsp;The name of a partner or partners, who represent the firm,h) &nbsp;The mode to share the profit and loss between/ among partners,i) &nbsp;The mode to calculate the profit of a firm,j) &nbsp;Any other matters, prescribed by the concerned Department stating which should be set out in the application&nbsp;<h3>Step 4 Submission of Physical Copy at Concern Department/ Office</h3>&nbsp;After the completion of the online form, upload all the documents, you will receive the message. Screenshot the message, print it, and visit the Department of Commerce and Supply Management or the concerned office designated by the government. Along with the application, you need to pay Rs. 100 as an application fee. The following document should be submitted:&nbsp;a) &nbsp; &nbsp; Application Formb)&nbsp; &nbsp; Citizenshipc) &nbsp; &nbsp; Photosd)&nbsp; &nbsp; Recommendation letter from the concerned departmente) &nbsp; &nbsp; Partnership Deedf)&nbsp; &nbsp; &nbsp; Self- Declaration (स्वघोषणा पत्र)g) &nbsp; &nbsp; Bank Statement (स्रोत पुष्टि हुने कागजात)h)&nbsp; &nbsp; Proof of Payment made through the banki) &nbsp; &nbsp; &nbsp; Recommendation/Approval according to law&nbsp;<h3>Step 5: Examination of Submitted Documents</h3>&nbsp;After submitting the documents, the Department/ office will examine them. If the documents order is in sequence, the partnership firm will be approved, and the Department will issue a certificate of incorporation. If the register detects an error in the documents, the Department will direct you to rectify or amend the mistake. After the correction, the department will issue a registration certificate.&nbsp;<h3>Step 6: Pay the Registration Fee</h3>&nbsp;After submitting the document, you need to pay the registration fee along with the application fee of Rs 100. Registration fees vary according to the capital of your partnership firm.The fee required for register are:<figure class="table"><table class="ck-table-resized"><colgroup><col style="width:50%;"><col style="width:50%;"></colgroup><tbody><tr><td>Capital (NRP)</td><td>Fee (NRP)</td></tr><tr><td>Up to One lakh</td><td>Rs 600</td></tr><tr><td>More than 1 lakh and up to 3 lakh</td><td>Rs 2000</td></tr><tr><td>More than 3 lakh and up to 5 lakh</td><td>Rs 4000</td></tr><tr><td>More than 5 lakh and up to 10 lakh</td><td>Rs 7000</td></tr><tr><td>More than 10 lakh and up to 50 lakh</td><td>Rs 10000</td></tr><tr><td>50 lakhs and above</td><td>Rs 15000</td></tr></tbody></table></figure>&nbsp;In Bagmati, Women, Dalit community members, and those from underprivileged backgrounds are eligible for a 50% discount on the registration fee when registering a firm. The registration for local trading depends on the provincial law of the particular province.&nbsp;After the payment, the concerned department officer will issue a registration certificate.<h3>&nbsp;</h3><h3>Step 7:&nbsp; Register of Business Ward</h3>&nbsp;After you obtain the incorporation certificate, you must register the company at the local level i.e. the ward office. The documents required for the ward office are:&nbsp;a) &nbsp; &nbsp; Registration Form- Available at each ward officeb)&nbsp; &nbsp; Rent Agreementc) &nbsp; &nbsp; Copies of Land owing certificated)&nbsp; &nbsp; Partnership deede) &nbsp; &nbsp; Property tax paid receiptf)&nbsp; &nbsp; &nbsp; Passport size photographsg) &nbsp; &nbsp; Photoh)&nbsp; &nbsp; Copies of citizenship of partners and house owneri) &nbsp; &nbsp; &nbsp; Certificate of Registrationj) &nbsp; &nbsp; &nbsp; Additionally, other documents required as per ward office or regulatory authorities.<h3>&nbsp;</h3><h3>Step 8: Register on PAN</h3>&nbsp;Next step is to register the partnership firm with tax authorities, and must apply through the IRD website. The link to visit (authorities. You must apply through the IRD website. You can visit this link: (<a href="https://ird.gov.np/">https://ird.gov.np/</a>). After filling the online application, you need to visit the IRD Office.&nbsp; The required documents for PAN Registration Process in Nepal are;&nbsp;a) &nbsp; &nbsp; PAN Application Formb)&nbsp; &nbsp; Copies of citizenshipc) &nbsp; &nbsp; Partnership Deedd)&nbsp; &nbsp; Rent Agreemente) &nbsp; &nbsp; Seal of the Businessf)&nbsp; &nbsp; &nbsp; Registration Certificate at the local level&nbsp;<h3>&nbsp;Frequently Asked Questions</h3>&nbsp;Should the already registered firm under Private Firm Registration Act be registered?&nbsp;The firm shall not be required to register the firm under the act of Partnership Firm Registration which has been already registered pursuant to Private Firm Registration Act, 2014. If the registration is not as per the Section 6 (the matters that are required to set an application) not mentioned in early registration, the concerned Department may seek such particulars and the partners shall submit such particulars to the concerned department.&nbsp;Can the property of the partnership be used?&nbsp;No partners shall use or cause to use the property of the partnership firm for any other purpose other than the purpose of the partnership business.&nbsp;&nbsp;When is the partner not entitled for profit?&nbsp;If a partner fails to pay the capital to be subscribed by him/her to the firm, he/she shall not be entitled to receive his/her profit until he/she pays the said capital.&nbsp;What is the liability of the partners?&nbsp;Every partner shall be liable jointly or personally with all the other partners for all the acts of the firm done while he/she was a partner.&nbsp;&nbsp;What can be the name of the firm?&nbsp;A firm shall not be given such a name which resembles the name of any other firm which is already registered, or the name of any limited company which is already registered under Company Act.&nbsp;Is there compulsion for additional capital?&nbsp;No, there is no compulsion for additional capital, than the amount prescribed in the agreement of partnership deed despite the request of other partners.&nbsp;Can a partner be substituted?No partners shall, without the consent of all other partners, make or keep to any other person as a partner in the firm instead of him./her.&nbsp;&nbsp;Disclaimer: The information provided here is for informational purposes only and should not be considered as legal advice. Please consult with a qualified legal expert for professional legal opinions. You can also consult with our&nbsp;<a href="https://www.biznestbazaar.com/hire-professional">professionals</a>&nbsp;for further assistance.&nbsp;

Partnership Firm Registration Process: Trading Business

&nbsp;Starting a business in Nepal is a rigorous journey. Understanding the registration process is important if you're considering a Private Firm. But don't worry! If you're planning an open business and want to keep things simple by operating under your name, without any complicated partnerships or setups, this blog is for you.&nbsp; But if you are willing to operate your business by registering a company then you can read our blog on <a href="https://www.biznestbazaar.com/blog/company-registration-process-in-nepal">company registration process</a>. It will guide you through the registration process.&nbsp;&nbsp;Before digging into the registration process it is important to know the meaning of Private Firm, and Governing Law.&nbsp;&nbsp;<h2>What is a Private Firm?</h2><h2>&nbsp;</h2>In Nepal, sole proprietorships are referred to as <a href="https://www.biznestbazaar.com/blog/how-to-register-a-trading-business-private-firm-in-nepal">private firms</a>. A sole propriewtorship is a business fully owned and managed by a single person. A person who owns such a type of business is known as a proprietor. It is the simplest business structure to run a business.&nbsp; A sole proprietorship is not a Limited Liability Company or entity with a separate legal entity from the owner. Business owner or proprietor had to pay business debts with his or her own money.&nbsp;&nbsp;&nbsp;A private firm that is based on traditional skills and technologies, labor-intensive, based on specific skills or local raw materials, local technologies, arts, and culture, and uses an engine, equipment, or machine that consumes up to fifty kilowatts of electrical energy are register in <a href="https://dcsi.gov.np/en">Department of Cottage and Small Industry</a>.&nbsp;&nbsp;<h3>Governing law for the registration of Private Firms in the Department of Cottage and Small Industry</h3>&nbsp;<ul><li>Private Firm Registration Act, 2014 B.S&nbsp; &nbsp;</li><li>Private Firm Registration Regulation, 2034 B.S &nbsp;</li><li>Industrial Enterprise Act, 2076 B.S.&nbsp; &nbsp;</li><li>Industrial Enterprise Regulation, 2078 B.S.&nbsp; &nbsp;</li><li>Province Law&nbsp;</li></ul><h3>&nbsp;</h3><h3>&nbsp;Governing Authority&nbsp;</h3><ul><li>Office of Cottage and Small Industry (Nepali: घरेलु तथा साना उद्योग कार्यलय)&nbsp; &nbsp;</li><li>List of Cottage and Small Industry are as follow:&nbsp;</li></ul> Office of Cottage and Small Industry, Jhapa &nbsp;Office of Cottage and Small Industry, Morang &nbsp;Office of Cottage and Small Industry, Sunsari &nbsp;Office of Cottage and Small Industry, Saptari &nbsp;Office of Cottage and Small Industry, Siraha &nbsp;Office of Cottage and Small Industry, Mahottari &nbsp;Office Of Cottage and Small Industry, Danusha &nbsp;Office Of Cottage and Small Industry, Sarlahi &nbsp;Office Of Industry and Commerce, Kathmandu &nbsp;Office Of Industry and Commerce, Lalitpur &nbsp;Office Of Industry and Commerce, Bhaktapur &nbsp;Office Of Industry and Commerce, Kavre &nbsp;Office Of Industry and Commerce, Makwanpur &nbsp;Office Of Cottage and Small Industry, Bara &nbsp;Office Of Cottage and Small Industry, Parsa &nbsp;Office Of Industry and Commerce, Chitwan &nbsp;Office Of Cottage and Small Industry, Rautahat &nbsp;Office Of Cottage and Small Industry, Nawalparasi &nbsp;Office Of Cottage and Small Industry, Kapilvastu &nbsp;Office Of Cottage and Small Industry, Rupandehi &nbsp;Office Of Cottage and Small Industry, Kaski &nbsp;Office Of Cottage and Small Industry, Palpa &nbsp;Office Of Cottage and Small Industry, Dang &nbsp;Office Of Cottage and Small Industry, Banke &nbsp;Office Of Cottage and Small Industry, Bardiya &nbsp;Office Of Cottage and Small Industry, Kailali &nbsp;Office Of Cottage and Small Industry, Kanchanpur &nbsp;<ul><li>Local Government (स्थानीय तह) (If the capital is less than 5 Lakh in the case of Bagmati province)&nbsp; &nbsp;</li></ul><h2>Process of Registration of Manufacturing and Service Business in the Office of Cottage and Small Industry&nbsp;</h2>&nbsp;<figure class="image"><img src="https://api-v1.biznestbazaar.com/public/blog_media/Registration_Process.png"></figure><h3>&nbsp;</h3><h3>What document is required to register your business in the Department of Cottage and Small Industries?</h3>&nbsp;List of Documents required to register business in the department of cottage and small industry:&nbsp;&nbsp;<ul><li>Application Form (Nepali: उद्योग दर्ता “ख” फाराम) &nbsp;</li><li>Passport-sized photos &nbsp;</li><li>Copies of Citizenship of the Proprietor and House Owner &nbsp;</li><li>Rent Agreement /Copy of Land Ownership Certificate&nbsp;(लालपूर्जा) &nbsp;</li><li>Electricity or Water Bill &nbsp;</li><li>Approval/Recommendation from the regulatory body according to the nature of industries (tourism, forestry, health, food) &nbsp;</li><li>Local site inspection (स्थानीय सर्जमिन मुचुल्का) and local level recommendation (स्थानीय तहको सिफारिस) for the business related to furniture and wood sawing, animal husbandry, plastic, dairy, workshop, mill, leather shoes, waste processing, soap, etc.) &nbsp;</li><li>Certificate of qualification for technical personnel&nbsp;&nbsp; &nbsp;</li><li>Letter of approval from the Nepal Rastra Bank for a firm engaged in money management business. &nbsp;</li><li>Recommendation letter or permission letter from the Department of Drug Administration for a firm engaged in pharmaceutical business. &nbsp;</li><li>IEE/EIA Report if deemed necessary.&nbsp; &nbsp;</li></ul><h3>What is the registration fee to register a business in the Department of Cottage and Small Industries?&nbsp;</h3>&nbsp;Registration fees depend on the provisional law of the concerned province.&nbsp;&nbsp;<h4>Registration Fee for Bagmati Province is&nbsp;&nbsp;</h4>&nbsp;<figure class="table"><table><tbody><tr><td>Capital (NRP)</td><td>Fee (NRP)</td></tr><tr><td>More than 5 Lakh to 20 lakh</td><td>12,000</td></tr><tr><td>More than 20 Lakh to 50 Lakh</td><td>20,000</td></tr><tr><td>More than 50 Lakh to 1 crore</td><td>28,000</td></tr><tr><td>More than 1 crore to 3 crore</td><td>36,000</td></tr><tr><td>More than 3 Crore to 5 crore</td><td>44,000</td></tr><tr><td>More than 5 Crore to 10 Crore</td><td>52,000</td></tr></tbody></table></figure>&nbsp;In the case of women, people with disabilities, and people who belong to Dalit or endangered communities, there will be a 50% discount on the registration fees.&nbsp;&nbsp;<h4>Registration Fee for Lumbini provience is&nbsp;</h4>&nbsp;<figure class="table"><table><tbody><tr><td>Capital (NRP)&nbsp; &nbsp; &nbsp;</td><td>Fee (NRP)&nbsp;</td></tr><tr><td>Up to 5 lakh</td><td>1,000</td></tr><tr><td>More than 5 Lakh to 20 lakh &nbsp; &nbsp;</td><td>5,000</td></tr><tr><td>More than 20 Lakh to 50 Lakh &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;&nbsp;</td><td>15,000</td></tr><tr><td>More than 50 Lakh&nbsp;</td><td>25,000</td></tr></tbody></table></figure>&nbsp;In the case of women, people with disabilities, and people who belong to Dalit or endangered communities, there will be a 50% discount on the registration fees.&nbsp;&nbsp;<h4>Registration Fee for Karnali Province&nbsp;</h4>&nbsp;<figure class="table"><table><tbody><tr><td>Capital (NRP)&nbsp; &nbsp; &nbsp;</td><td>Fee (NRP)</td></tr><tr><td>Up to 5 lakh</td><td>500</td></tr><tr><td>More than 5 Lakh to 10 lakh &nbsp; &nbsp;</td><td>1,000</td></tr><tr><td>More than 10 Lakh to 25 Lakh &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;&nbsp;</td><td>5,000</td></tr><tr><td>More than 25 Lakh to 1 Crore</td><td>10,000</td></tr><tr><td>More than 1 Crore to 5 Crore</td><td>12,000</td></tr><tr><td>More than 5 Crore to 10 Crore</td><td>17,000</td></tr><tr><td>Above 10 Crore</td><td>25,000</td></tr></tbody></table></figure>&nbsp;<h4>Registration Fee for Koshi Province&nbsp;</h4>&nbsp;<figure class="table"><table><tbody><tr><td>Capital (NRP)</td><td>Fee (NRP)</td></tr><tr><td>Up to 5 Lakh &nbsp;</td><td>2,000</td></tr><tr><td>More than 5 Lakh to 20 lakh</td><td>4,000 &nbsp;</td></tr><tr><td>More than 20 Lakh to 50 Lakh&nbsp; &nbsp; &nbsp;</td><td>7,000 &nbsp;</td></tr><tr><td>More than 50 Lakh to 1 Crore</td><td>15,000</td></tr><tr><td>More than 1 Crore to 5 Crore</td><td>25,000 &nbsp;</td></tr><tr><td>More than 5 Crore to 10 Crore</td><td>60,000</td></tr><tr><td>Above 10 Crore</td><td>&nbsp;</td></tr></tbody></table></figure>&nbsp;Registration Fee For Gandaki Province&nbsp;&nbsp;<figure class="table"><table><tbody><tr><td>Capital (NRP)</td><td>Fee (NRP)</td></tr><tr><td>Up to 10 Lakh</td><td>1,000</td></tr><tr><td>More than 10 Lakh to up to 50 Lakh</td><td>5,000</td></tr><tr><td>More than 50 Lakh up to 1 Crore</td><td>10,000</td></tr><tr><td>More than 1 crore to 10 Crore</td><td>50,000</td></tr><tr><td>More than 10 Crore</td><td>75,000&nbsp;</td></tr></tbody></table></figure>&nbsp;For women, people with disabilities, and people who belong to Dalit or endangered communities, get a 50% discount on the registration fees.&nbsp;<h4>Registration Fee for Sudurpaschim&nbsp;</h4>&nbsp;<figure class="table"><table><tbody><tr><td>Capital ( NRP)</td><td>Fee (NRP)</td></tr><tr><td>Up to 10 Lakh</td><td>4,000</td></tr><tr><td>More than 10 Lakh up to 50 Lakh</td><td>10,000&nbsp;</td></tr><tr><td>More than 50 Lakh up to 1 Crore</td><td>20,000&nbsp;</td></tr><tr><td>More than 1 Crore to 5 Crore</td><td>50,000</td></tr><tr><td>More than 5 Crore to 10 Crore</td><td>60,000&nbsp;</td></tr><tr><td>More than 10 Crore</td><td>70,000</td></tr></tbody></table></figure><h4>&nbsp;</h4><h4>Registration Fee for Madhesh Pradesh&nbsp;</h4>&nbsp;For women, individuals from the dalit community, and marginalized groups, the registration fee with a capital up to 1 Crore is Rs 100. Additionally, a 50 % discount to register a firm capital exceeds 1 Crore up to 5 crore.&nbsp;&nbsp;<figure class="table"><table><tbody><tr><td>Capital ( NRP)</td><td>Fee (NRP)</td></tr><tr><td>Up to 1 Lakh</td><td>1,000</td></tr><tr><td>More than 1 Lakh up to 3 Lakh</td><td>3,000&nbsp;</td></tr><tr><td>More than 3 Lakh up to 5 Lakh</td><td>6,000&nbsp;</td></tr><tr><td>More than 5 Lakh to 20 Lakh</td><td>12,000</td></tr><tr><td>More than 20 Lakh to 1 Crore</td><td>20,000&nbsp;</td></tr><tr><td>More than 1 Crore up to 5 Crore</td><td>30,000</td></tr><tr><td>More than 5 Crore</td><td>50,000</td></tr></tbody></table></figure>&nbsp;<h3>What documents are required to register a business in the ward?&nbsp;</h3>&nbsp;<ul><li>Registration Form- Available at the ward office &nbsp;</li><li>Rent Agreement &nbsp;</li><li>Citizenship Land Owner &nbsp;</li><li>Copies of Land-Owning Certificate &nbsp;</li><li>Property Tax paid Receipt &nbsp;</li><li>Passport- Size photographs&nbsp; &nbsp;</li><li>Copies of land-owning certificate.&nbsp; &nbsp;</li><li>Photo&nbsp; &nbsp;</li><li>Copies of citizenship of proprietor and house owner &nbsp;</li><li>Certificate of Registration &nbsp;</li><li>Any additional documents or forms as required by the ward office or regulatory authorities &nbsp;</li></ul><h3>What documents are required for the PAN Registration ?&nbsp;</h3>&nbsp;<ol><li>PAN Application Form &nbsp;</li><li>Copies of Citizenship &nbsp;</li><li>Rent Agreement&nbsp; &nbsp;</li><li>Business Seal&nbsp; &nbsp;</li><li>Business Registration Certificate at the local level.</li></ol>&nbsp;<h2>Frequently Asked Question&nbsp;</h2>&nbsp;Is it necessary to renew private firms?&nbsp;&nbsp;Yes, it is necessary to renew private firms. Initially renew after 5 years of Registration and then every 2 years private firms need to renew.&nbsp;&nbsp;What are the documents required to renew private firms?&nbsp;&nbsp;The required documents are:&nbsp;&nbsp;<ul><li>Renewal application form&nbsp; &nbsp;</li><li>Self-declaration form if the firm exceeds 5 Years.&nbsp; &nbsp;</li><li>Firm Registration certificate&nbsp; &nbsp;</li><li>Tax Paid Receipt &nbsp;</li><li>Tax clearance certificate&nbsp;</li></ul>&nbsp;Is the proprietor required to be physically present during the registration of the Private Firm?&nbsp;&nbsp;Yes, the physical presence of the proprietor is necessary during the registration process.&nbsp;Can I Change the Objective of a private firm?&nbsp;Yes, you can change your objective of the firm by paying the prescribed fee in the department.&nbsp;Is it possible to change the name of a private firm after its registration?&nbsp;Yes, the private firm name can be changed after registration. You need to submit an application, accompanied by the tax-paid receipt and the original certificate of registration. However, the firm's registration must be renewed.&nbsp;How long does it take to register a private firm in Nepal?&nbsp;It can take around five days. However, the duration for registering a private firm depends on factors like document completeness and office workload.&nbsp;&nbsp;What steps should be taken if the registration certificate is misplaced or damaged?&nbsp;You can apply for a copy (प्रतिलिपि) if the registration certificate is misplaced or damaged. The following documents need to be submitted:&nbsp;&nbsp;<ul><li>Application&nbsp; &nbsp;</li><li>Document explaining the reason for applying &nbsp;</li><li>Citizenship&nbsp;</li></ul>&nbsp;The proprietor needs to be present physically in the office. Along with application and document you also need to pay a fee to apply for a copy registration certificate.&nbsp;Disclaimer: The information provided here is for informational purposes only and should not be considered as legal advice. Please consult with a qualified legal expert for professional legal opinions. You can also consult with <a href="https://www.biznestbazaar.com/hire-professional">our professionals</a> for further assistance.&nbsp;

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