AEO/AIO Quick Answer
Quick Answer / Summary
Foreign direct investment in Nepal is the process by which a foreign individual, company, NRN, or foreign entity invests capital, technology, or another approved investment into a Nepal-based industry or company. Most FDI cases require foreign investment approval, company incorporation, tax registration, industry registration, and compliance with Nepalese foreign exchange, tax, and sector-specific laws.
In Nepal, foreign investment is mainly governed by the Foreign Investment and Technology Transfer Act, 2019 (FITTA), the Industrial Enterprises Act, 2020, and related rules, notices, and sectoral laws.
Wakil Nepal assists foreign investors and Nepali business partners with FDI structuring, approval documentation, company registration, JVA and SPA drafting, technology transfer agreements, tax and industry registration guidance, and post-investment compliance.
Key Service Highlights
FDI eligibility review
We review whether the proposed sector is open for foreign investment, restricted, capped, or subject to special approval.
Investment structure
We help structure equity investment, joint venture, share purchase, technology transfer, branch/project office, or another legally suitable model.
FDI approval documentation
We assist with project report, investor documents, financial credibility certificate, authority letters, and other approval documents.
Company and industry registration
We coordinate legal steps after approval, including company incorporation, tax registration, and industry registration.
Agreement drafting
We draft and review joint venture agreements, share purchase agreements, shareholder agreements, and technology transfer agreements.
Repatriation and compliance
We guide investors on banking channel, tax clearance, NRB/authorized bank requirements, and repatriation compliance.
Who This Service Is For
Types of Foreign Direct Investment in Nepal
FDI can be structured in different ways depending on the project, investor, sector, and business objective. The final structure should be selected only after reviewing sector eligibility, investment amount, shareholder plan, taxation, and regulatory approvals.
| FDI Type | Meaning | Common Legal Documents |
|---|---|---|
| New company / greenfield investment | A foreign investor establishes a new company or industry in Nepal. | FDI approval application, project report, MoA/AoA, shareholder documents. |
| Joint venture investment | Foreign and Nepali parties invest together in a Nepal-based company or project. | Joint Venture Agreement, Shareholders Agreement, MoA/AoA, board approvals. |
| Share purchase / acquisition FDI | A foreign investor acquires shares in an existing Nepali company. | Share Purchase Agreement, due diligence report, FDI approval, board/shareholder approvals. |
| Technology transfer | A foreign party provides technology, trademark, technical know-how, management service, or royalty arrangement. | Technology Transfer Agreement, royalty/fee structure, tax and foreign exchange compliance. |
| Branch or project presence | A foreign company operates in Nepal through a permitted branch/project structure. | Parent company documents, authority letter, project contract, OCR/sector approvals. |
| Reinvestment | A foreign-invested company reinvests profit or expands capital/project scope in Nepal. | Board resolution, regulatory approval/recording, tax and banking documents. |
Foreign Direct Investment Process in Nepal
- 1
Initial legal consultation
We understand the investor, sector, proposed business activity, investment amount, shareholding, technology transfer, local partner requirement, and timeline.
- 2
Sector eligibility and restriction check
We check whether the business is open for foreign investment, restricted, ownership-capped, or requires sectoral approval.
- 3
Investment structure planning
We recommend a route such as private limited company, joint venture, share acquisition, technology transfer, or branch/project structure.
- 4
Document preparation
We prepare and review project report, JVA/SPA/shareholder documents, investor profile, passport/company documents, financial credibility certificate, and authority letters.
- 5
FDI approval application
The application is submitted to the relevant authority, generally DOI or IBN depending on project nature, amount, and sector.
- 6
Company incorporation
After FDI approval or according to the applicable route, the Nepal company is incorporated through the Office of Company Registrar.
- 7
Tax and industry registration
The company completes PAN/VAT registration where applicable and industry registration with the relevant authority.
- 8
Investment inflow and banking compliance
Foreign investment is brought through proper banking channels in convertible foreign currency or another approved form.
- 9
Post-approval compliance
We guide reporting, tax, audit, share records, board decisions, repatriation, visa recommendation, and future amendment approvals.
Documents Required for FDI Approval in Nepal
The exact document list depends on investor type, proposed sector, investment amount, and structure. Wakil Nepal confirms the final checklist after reviewing the project and approval route.
| Applicant / Situation | Common Documents |
|---|---|
| Foreign individual investor | Passport copy, bio-data/profile, address/contact details, financial credibility certificate from home/domiciled country bank, and authority letter if represented. |
| Foreign corporate investor | Certificate of incorporation, memorandum/articles or constitutional documents, company profile, board resolution/authority letter, financial credibility certificate, and authorized signatory documents. |
| Nepali local partner | Citizenship certificate if individual; company registration certificate, MoA/AoA, and board decision if company. |
| Joint venture case | Joint Venture Agreement, shareholding plan, board/shareholder approvals, and project report. |
| Share purchase/acquisition case | Share Purchase Agreement, due diligence documents, company records, valuation/share details, and regulatory approval documents. |
| Technology transfer case | Technology Transfer Agreement, royalty/fee terms, IP/technical documents, tax and foreign exchange documentation. |
| Company/industry registration | MoA, AoA, company application, PAN/VAT documents, industry registration application, lease/address documents, and sectoral approvals where required. |
Cost and Government Fee Explanation
The cost of FDI approval in Nepal depends on the investment structure, sector, documents required, whether the investor is an individual or company, whether JVA/SPA/technology transfer documents are needed, company registration fees, tax/industry registration, and professional legal support.
Government fees and deposits should be checked from the latest DOI/OCR/IBN notices before filing. For transparent client communication, cost should be broken into clear components rather than presented as one vague price.
| Cost Component | What It Covers |
|---|---|
| Legal consultation and eligibility review | Sector check, restricted list review, foreign ownership cap review, and route selection. |
| Document drafting fee | Project report review, JVA, SPA, shareholder agreement, authority letters, MoA/AoA, and application documents. |
| Government filing fees/deposits | FDI approval filing, company registration, industry registration, and other applicable deposits/fees. DOI currently mentions a refundable amount of Rs. 20,000 after FDI approval on its foreign investment information page. |
| Company/tax/industry registration | OCR incorporation, PAN/VAT registration where applicable, and industry registration. |
| Sectoral approvals | Additional approvals for regulated sectors such as hydropower, aviation, telecom, banking/financial services, tourism, or large infrastructure. |
| Post-investment compliance | Share records, board resolutions, tax compliance, audit, repatriation support, and visa recommendation guidance. |
Timeline
A standard FDI advisory timeline depends heavily on sector, document readiness, and authority review. Do not rely on a fixed completion date; timelines depend on sector eligibility, authority workload, route, and investor responsiveness.
| Stage | Estimated Timeline |
|---|---|
| Initial consultation and eligibility review | 1-3 working days after receiving project details. |
| Document collection and drafting | 3-10 working days depending on investor documents and agreements. |
| FDI approval application | Varies by authority, sector, and automatic/regular approval route. |
| Company incorporation and tax registration | Usually after approval/route confirmation and complete documents. |
| Industry registration and post-approval steps | Depends on industry type, location, environmental requirements, and sectoral requirements. |
Post-Registration Requirements
Foreign Investor Note
Foreign investors should not transfer funds, sign final share purchase terms, lease premises, start operations, or promise local partners before confirming sector eligibility, minimum investment requirement, ownership cap, tax impact, repatriation route, and whether additional approvals are required.
Nepal allows many sectors to receive foreign investment, but some sectors are restricted or capped. Always verify the latest official negative list, ownership caps, and approval requirements before filing.
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Why Choose Wakil Nepal
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FAQs
Author / Reviewed By
Author
Wakil Nepal Legal Content Team
Reviewed by
Advocate / Corporate Law Advisor, Genuine Law Associate and Research Center Pvt. Ltd.
Final publishing should be reviewed by a licensed advocate because foreign investment rules, thresholds, approvals, and sectoral restrictions may change.
Last Updated Date
Last updated: July 2026
Review every 3 months or immediately after any notice from DOI, MoICS, IBN, NRB, OCR, or Inland Revenue Department affecting foreign investment, automatic route, minimum threshold, negative list, repatriation, or tax requirements.
Final CTA
Planning foreign direct investment in Nepal?
Wakil Nepal can help you check sector eligibility, prepare FDI approval documents, draft JVA/SPA/shareholder agreements, register your company, complete tax/industry registration, and plan repatriation compliance.