Nepal is located in South Asia, mostly in the Himalaya mountains. It is bordering China in the North, with the border including the world's highest mountain peak, Mount Everest, and India in the South. It is located between the two fastest-growing economies in the world, which gives you many import and export business opportunities. However, Major industries include tourism, carpets, textiles, cigarettes, cement, brick, as well as small rice, jute, sugar, and oilseed mills. Most of these businesses are operating as sole proprietorships.
Disclaimer: Be aware that this article is not a substitute for legal advice. Please always check official websites or seek legal advice before you take action.
Private firms in Nepal
In Nepal, sole proprietorships are referred to as private firms.
The private firm is described in the Private Firm Registration Act 1958. Sole proprietorship firms do not have a separate legal and natural person, and the liability of the owner is not limited. These forms of business are mostly used by individuals undertaking trading activities: retailers, shops and importers of goods, and professional service providers like lawyers and accountants. Private firms are easy to establish and dissolve. They are also easy to control; decision making is prompt and flexible since there is only one person operating it.
Private Firm Registration in Nepal
As mentioned before, the private firm registration is done under the Private Firm Registration Act 1958. Here we will explain the whole process.
To register the firm, you will need to provide the documents to the
- Department of Commence in the case of a commerce-related firm
- Department of Cottage and Rural Industry in the case of the cottage and rural industry
- Department of Industry for any other industry
These are the required documents for private firm registrations:
- The name of the private firm
- The address of the private firm
- Objectives, functions, and the particulars of goods or commodities to be transacted by the private firm
- The name and address of the owner and the name of their parents and grandparents
- Other details, prescribed by the Government of Nepal by publishing a Notification in the Nepal gazette.
Based on the capital of the firm, the registration fee needs to be paid. It costs between NPR 600 and 15,000.
No more than one private firm related to the same or similar objectives can be registered in the same person's name.