Branch Office Registration in Nepal

12 Dec

Updated on: March 28, 2026

Reading time: 15 minutes

Are you looking for information about branch office registration in Nepal? Foreign companies seeking to establish a commercial presence in Nepal often choose between registering a branch office, establishing a liaison office, or incorporating a subsidiary company. Understanding the differences, legal requirements, and compliance obligations is essential for making the right decision.

This comprehensive guide explains branch office registration in Nepal, covering the legal framework under the Companies Act 2063 (2006), registration procedures with the Office of Company Registrar (OCR), compliance requirements, and ongoing obligations that foreign companies must fulfill .

What is Branch Office Registration in Nepal?

A branch office in Nepal is an extension of a foreign parent company that is legally authorized to conduct business operations and generate income within the country. Unlike a liaison office (which can only coordinate activities), a branch office can engage in commercial transactions, sign contracts, hire employees, and earn revenue .

Characteristic	Branch Office	Liaison Office	Subsidiary Company
Legal Status	Extension of parent company	Extension of parent company	Separate legal entity
Income Generation	Permitted	Prohibited	Permitted
Contract Signing	Yes	No	Yes
Separate Legal Personality	No	No	Yes
FDI Approval	Not required (direct OCR registration)	NRB approval required	DOI/IBN approval required
Minimum Capital	No fixed requirement	No fixed requirement	Applicable

Under Section 154 of the Companies Act 2063, no foreign company can carry on business in Nepal without registering a branch office or establishing a liaison office with the Office of Company Registrar .

Legal Framework for Branch Office Registration in Nepal

The branch office registration in Nepal is governed by multiple legal instruments :

Legal Instrument	Key Provisions
Companies Act 2063 (2006)	Section 154 mandates registration; defines branch office requirements
Foreign Investment and Technology Transfer Act 2075 (2019)	Governs foreign business operations
Income Tax Act 2058 (2002)	Tax obligations for branch offices
Nepal Rastra Bank Regulations	Foreign exchange and repatriation rules
Labor Act 2074 (2017)	Employment regulations

Section 154(1) of the Companies Act 2063 states: "No foreign company shall carry on any business or transaction in Nepal without having a branch office of such company registered with the Office pursuant to this Section or establishes such office without having a liaison office registered" .

Who Needs Branch Office Registration in Nepal?

A foreign company is deemed to have established an office in Nepal requiring registration if it :

Trigger	Description
Time Threshold	Carries on transactions for one month or more through an office in Nepal
Physical Presence	Uses an office for business activities
Regular Contact	Appoints any person for regular contact in Nepal
Service Provision	Avails services through an established presence

Exclusions: Making investment in shares, lending money, or participating in management with competent body approval is NOT deemed carrying on business .

Step-by-Step Branch Office Registration Process in Nepal

Phase 1: Pre-Registration Preparation (1-2 weeks)

Step	Activity	Details
1	Determine Business Structure	Confirm branch office is appropriate (vs. liaison office or subsidiary)
2	Gather Parent Company Documents	Collect incorporation certificates, MOA, AOA, board resolutions
3	Identify Local Representative	Appoint authorized representative with Nepali citizenship
4	Prepare Business Plan	Document proposed activities and operational plan

Phase 2: Obtain Government Approval (If Required) (2-4 weeks)

Scenario	Approval Authority	Documentation
Government Contract	Concerned Ministry/Department	Contract copy or selection letter
Private Sector Work	Contract with private entity may require clarification	Agreement documentation
No Specific Contract	General approval from concerned body	Recommendation letter

Important: If selected through competitive process or having government contract, such selection/contract is deemed permission for registration purposes .

Phase 3: Application Submission to OCR (1-2 days)

Submit application to the Office of Company Registrar with required documents and fees :

Submission Method	Process
Physical Submission	Submit at OCR, Tripureshwor, Kathmandu
Online Portal	Through CAMIS system where applicable

Phase 4: Document Verification and Registration (2-3 weeks)

Step	Activity	Timeline
1	OCR Document Review	Verify completeness and authenticity
2	Query Response	Address any OCR queries promptly
3	Approval and Registration	OCR grants registration
4	Certificate Issuance	Branch Office Registration Certificate issued

Timeline: Generally 2-3 weeks from complete application submission .

Phase 5: Post-Registration Compliance (1-2 weeks)

Registration	Authority	Purpose
PAN Registration	Inland Revenue Department	Tax identification
VAT Registration	Inland Revenue Department	If turnover exceeds threshold
Ward Office Registration	Local Ward Office	Local business authorization
Bank Account Opening	Commercial Bank	Business transactions

Required Documents for Branch Office Registration in Nepal

Essential Documents Checklist

Document Category	Specific Documents
Application	Application for branch office registration at OCR
Parent Company Documents	Certificate of incorporation, MOA, AOA (notarized with Nepali translation)
Company Profile	Signed company profile of foreign parent
Board Resolution	Resolution authorizing branch establishment in Nepal
Director Identification	Passport copies of all directors
Local Representative	Citizenship certificate of authorized representative
Authorization	Power of attorney for local representative
Appointment Letter	Letter appointing authorized representative
Operational Plan	Proposed plan of branch office operations
Government Approval	Approval/recommendation letter from concerned authority (if applicable)
Government Contract	Executed agreement with Nepalese government authority (if applicable)
Declaration	Declaration from directors regarding truthfulness of information

Additional Documents (As Required)

Document	Purpose
Audited financial statements	Demonstrate parent company financial capacity
Bank reference letter	Financial credibility
Tax clearance certificate	Compliance status in home country
Commitment letter for investment	Investment intention documentation
Proposed organization structure	Branch office hierarchy

Government Fees for Branch Office Registration in Nepal

Registration fees are based on proposed investment amount :

Proposed Investment (NPR)	Registration Fee (NPR)
Up to 10,000,000	15,000
10,000,001 – 100,000,000	40,000
100,000,001 – 200,000,000	70,000
200,000,001 – 300,000,000	100,000
300,000,001 – 400,000,000	130,000
400,000,001 – 500,000,000	160,000
Above 500,000,000	3,000 + 3,000 for each additional 10,000,000

Note: If proposed investment amount is not specified, flat fee of NPR 100,000 applies .

Timeline for Branch Office Registration in Nepal

Phase	Duration	Cumulative
Document Preparation	1-2 weeks	1-2 weeks
Approval/Permission (if required)	2-4 weeks	3-6 weeks
OCR Processing and Registration	2-3 weeks	5-9 weeks
Post-Registration (PAN, VAT, Ward)	1-2 weeks	6-11 weeks
Total Estimated Time	4-8 weeks	Approximately 2-3 months

Permitted Activities for Branch Office in Nepal

A registered branch office may :

Permitted Activity	Description
Commercial Operations	Conduct business activities similar to parent company
Contract Execution	Enter into contracts with local clients
Revenue Generation	Invoice local clients and receive payment
Local Employment	Hire Nepali and foreign staff
Project Execution	Work on infrastructure, IT, consulting assignments
Trading Activities	Buy and sell goods (subject to sectoral restrictions)

Restrictions:

Activities must be similar to parent company's business
Must comply with Nepalese laws and regulations
Cannot exceed scope of parent company's objectives
Sectoral restrictions may apply for certain industries

Post-Registration Compliance Requirements

Initial Compliance (Within 3 Months)

Requirement	Deadline	Details
Initial Compliance Submission	Within 3 months of registration	Submit to OCR
Auditor Appointment	Within 3 months	Appoint licensed auditor
Bank Account Opening	Immediate	Open local corporate account

Annual Compliance

Requirement	Frequency	Deadline	Authority
Annual Compliance Filing	Annual	Within 6 months of fiscal year-end	OCR
Audited Financial Statements	Annual	Within 6 months of fiscal year-end	OCR
Head Office Financial Statements	Annual	Within 3 months of preparation	OCR
Income Tax Return	Annual	Within 3 months of fiscal year-end	IRD
VAT Return	Monthly/Quarterly	As per tax calendar	IRD
Business Tax Payment	Annual	Before fiscal year-end	Ward Office
Rent Tax Payment	Monthly	Monthly basis	Ward Office

Other Compliance Requirements

Area	Requirement
Labor Compliance	Adhere to Labor Act 2074, SSF contributions, work permits for foreigners
Foreign Exchange	NRB compliance for remittances, currency transactions
Visa Compliance	Work permits and visas for expatriate employees
Record Maintenance	Proper books of accounts at Nepal office

Branch Office vs. Other Business Structures

Comparison Summary

Aspect	Branch Office	Liaison Office	Subsidiary (FDI)
Legal Status	Extension of parent	Extension of parent	Independent entity
Registration	Direct OCR	NRB + OCR	DOI/IBN + OCR
Business Activities	Full commercial	Only liaison/coordination	Full commercial
Income Generation	Yes	No	Yes
Minimum Capital	No fixed requirement	No fixed requirement	Applicable
Taxation	25% corporate tax	No income (no tax)	25% corporate tax
Liability	Parent company liable	Parent company liable	Limited liability
Repatriation	Subject to NRB rules	N/A	Subject to FITTA

Frequently Asked Questions About Branch Office Registration in Nepal

What is branch office registration in Nepal?

Branch office registration in Nepal is the legal process by which a foreign company establishes an extension of its business to conduct commercial operations in Nepal. The branch office can generate income, sign contracts, hire employees, and perform business activities similar to the parent company, subject to registration with the Office of Company Registrar under Section 154 of the Companies Act 2063 .

Who can register a branch office in Nepal?

Any foreign company incorporated outside Nepal can register a branch office. The parent company must provide proper documentation including incorporation certificate, board resolution, and appoint an authorized representative with Nepali citizenship .

What is the difference between branch office and liaison office in Nepal?

A branch office can conduct commercial activities, generate income, and execute contracts in Nepal. A liaison office can only coordinate, communicate, and facilitate parent company interests without engaging in commercial transactions or earning revenue. Branch offices require OCR registration; liaison offices require NRB approval .

Is FDI approval required for branch office registration in Nepal?

No, branch office registration does not require FDI approval from the Department of Industry. Branch offices are registered directly with the Office of Company Registrar. However, if the branch is established pursuant to a government contract, approval from the concerned ministry may be required .

What is the minimum capital requirement for branch office in Nepal?

There is no fixed minimum capital requirement for branch office registration in Nepal. The investment amount should align with operational requirements. However, some sources indicate NPR 50 million may be applicable for certain foreign investments under FITTA .

How long does branch office registration take in Nepal?

The branch office registration in Nepal typically takes 2-3 weeks for OCR processing after document submission. The complete process including approvals (if required), post-registration formalities, and bank account opening takes approximately 4-8 weeks .

What documents are required for branch office registration?

Required documents include: parent company incorporation certificate, MOA, AOA (with Nepali translation), board resolution for branch establishment, passport copies of directors, citizenship of local representative, power of attorney, operational plan, and government approval (if applicable) .

Can a branch office repatriate profits to the parent company?

Yes, branch offices can remit profits to the parent company subject to compliance with Nepal Rastra Bank regulations, payment of applicable taxes (25% corporate tax), and submission of required documentation for foreign exchange approval .

What taxes does a branch office pay in Nepal?

Branch offices are subject to 25% corporate income tax, VAT (if turnover exceeds threshold), tax deducted at source (TDS), and other applicable taxes under the Income Tax Act 2058 .

Is annual compliance mandatory for branch offices?

Yes, branch offices must submit annual compliance to OCR within 6 months of fiscal year-end, file audited financial statements, submit parent company financials within 3 months of preparation, and comply with tax filing requirements .

Can a branch office own property in Nepal?

Generally, branch offices cannot own immovable property (land) in Nepal unless permitted under specific government decision. However, they can lease property for business operations .

What is the cost of branch office registration in Nepal?

Government fees range from NPR 15,000 (for investment up to NPR 10 million) to NPR 160,000+ (for larger investments), or NPR 100,000 flat fee if investment amount is not specified. Total costs including professional services range from NPR 50,000 to NPR 200,000+ .

Conclusion

The branch office registration in Nepal provides foreign companies with a streamlined mechanism to establish commercial operations without incorporating a separate legal entity. With no minimum capital requirement for most cases and direct registration through OCR (bypassing FDI approval), branch offices offer an efficient entry strategy for foreign businesses.

Key advantages include:

Ability to conduct full commercial operations and generate income
No separate legal personality complications
Direct control from parent company
Simpler registration process compared to subsidiary formation

However, businesses must carefully consider that branch offices do not provide limited liability protection (parent company remains fully liable) and must maintain strict compliance with annual reporting, tax, and regulatory obligations.

For professional assistance with branch office registration in Nepal, document preparation, compliance management, or ongoing regulatory matters, Corporate Np provides comprehensive legal and consulting services. Our team specializes in foreign company registration and can guide you through every stage of the process.

Disclaimer

The information provided in this article is for general informational purposes only and does not constitute legal advice. Foreign company regulations are subject to amendment. Readers should consult qualified legal professionals and check official government sources (OCR, DOI, NRB, IRD) for the most current information. The author and publisher disclaim liability for any actions taken based on this information.

References

Need expert assistance with your branch office registration? Contact Corporate Np today for professional guidance through the branch office registration process in Nepal.

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