Registration of foreign company

Registration of foreign company

(1) No foreign company shall carry on any business or transaction in the Nepal without having a branch office of such company registered with the office of such company registered with the office pursuant to this Section or establishes such office without having a liaison office registered.

             Provided, however, that making investment in shares in any company established pursuant to law, lending money to such company or participating in the operation or management of such company, with the approval of the competent body, shall not be deemed to be the carrying on of a business or transaction for the purposes of this Chapter .

Explanation: Where any foreign company carries on any transaction for a period of one month or more through an office established in Nepal or used therefor or appoints any person for regular contact or avails its service, such company shall be deemed to have done a transaction or established an office in Nepal for the purpose of this Chapter.

(2) A foreign company desiring to have its branch office registered pursuant to Sub-section (1) shall make to the Office an application, accompanied by the permission obtained from the concerned body pursuant to the prevailing law, and the prescribed fees and in such format, as prescribed, for the registration of such company.

(3) A foreign company desiring to have its liaison office registered pursuant to Sub-section (1) shall make to the Office an application, accompanied by the permission, if any, required to be obtained from the concerned body pursuant to the prevailing law for the registration of such office, and the prescribed fees and in such format as prescribed, for the registration of such company.

Explanation: where any foreign company is selected by any competent body pursuant to the prevailing law or enters into contract with any competent body, for any business in Nepal, the making of such selection entering into such contract shall, for the purposes of Subsections (1) and (2), be deemed to be the permission given by the concerned body.

(4) On receipt of an application made for the registration of a foreign company pursuant to Sub-section (2) or (3), the Office shall make necessary inquiry, register such company and give the registration certificate, as prescribed, no later than thirty days after the making of the application for carrying on a business or transaction in or establishing a liaison office in the Nepal.

(5) Where a foreign company cannot be registered pursuant to an application made under Sub-section (2) or (3), the Office shall give information thereof, setting out the reasons for the same, to the concerned applicant within thirty days.

(6) A foreign company registered pursuant to Sub-section (4) may open its branch office and carry on the concerned business or transaction in or open its liaison office in the Nepal.

            Provided, however, that a foreign company registered as a liaison office shall not be entitled to do any income earning activity in Nepal.

(7) Where the name of a foreign company making application pursuant to Sub section (2) or (3) or the objective to be implemented by such company is of such a nature that it cannot be registered pursuant to this Act, such foreign company shall not be registered in Nepal.

(8) A foreign company registered pursuant to Sub-section (4) shall be deemed to have been registered to carry on only the same type of business or transaction as is being carried on by it in the country where its registered office is situated or it has been incorporated.

(9) A foreign company registered pursuant to this Section shall put its name board in the place of its business in a manner conspicuous to all,, and the name of country where the company has been established and the registration number of the company registered in Nepal shall be clearly mentioned in such board and bills, receipts, invoices, etc or letterhead to be used by the company.

(10) The office shall maintain a separate register for the registration of foreign companies registered pursuant to this Section and make arrangements for the inspection of such register by the general public and for getting a copy thereof by paying the prescribed fees.

(11) Notwithstanding anything contained elsewhere in this Act, a foreign company registered pursuant to this Section shall not issue shares or debentures within the Nepal.

(12) Notwithstanding anything contained elsewhere in this Act, a foreign company which is carrying on a business or transaction or which has established its liaison office in the Nepal without having been registered at the time of commencement of this Act shall get it registered with the Office pursuant to this Act no later than six months after the date of commencement of this Act.