Approval Authorities for Foreign Direct Investment (FDI) in Nepal

1. Department of Industry (DOI): For Investment Amount NPR 6 billion or Less
2. Investment Board of Nepal (IBN): Investment Amount Above NPR 6 billion and Hydropower project more than 200 MW.

FDI Priority Sectors by Nepal Government

1. Hydropower and renewable energy
2. Agriculture and Forest product based industry
3. Tourism and hospitality (resorts, hotel, eco-tourism)
4. Information Technology (IT services, software)
5. Education and health (international-standard institutions)
6. Manufacturing industry (especially export-oriented)
7. Infrastructure industry (transport, industrial parks, urban development)

Restricted/Prohibited Sectors by Nepal Government

1. Primary agriculture production such as poultry farming, bee farming, vegetable farming, milk industry etc.
2. Cottage and Small industries
3. Arms/ammunition business
4. Personal service business such as hair cutting, tailoring etc
5. Travel agency, homestay
6. Business of mass communication and media
7. Tobacco and alcohol production for domestic consumption
8. Gambling and casinos (without specific government approval)
9. Real estate business
10. Consultancy service having foreign investment more than 50%.

Process of Establishment and Operation of Foreign Direct Investment (FDI) in Nepal

1. Obtain Foreign Investment Approval from Department of Industry (DOI) or Investment Board Nepal (IBN).
2. Incorporation of the Company at the Office of the Company Registrar Nepal
3. Tax Registration at Inland Revenue Office
4. Business Registration at Local Ward Office
5. Obtain Letter of Recommendation from Local Level
6. Registration of Industry at DOI
7. Obtain Non-Blacklisted Certificate from Credit Information Bureau
8. Obtain Nepal Rastra Bank (NRB) Approval to Bring in the Investment Amount in Nepal
9. Obtain investment amount in local bank in Nepal and record the investment amount at NRB

Minimum Investment Requirement for Foreign Investment Approval

The minimum investment required for obtaining foreign investment approval has been fixed at NPR 20 million (approx. USD 150,000).

Documents Requirement for FDI Approval in Nepal

The list of documents required for obtaining foreign direct investment approval in Nepal are as follows:

1. Project Report outlining the Project Background, market aspect, technical aspect, financial aspect, details of such funds etc.
2. Bio-Data/ Company Profile of the Foreign Investor
3. Copy of Certificate of Registration and other Registration Documents (Memorandum of Association, Articles of Association, etc.) of the Foreign Investor.
4. Corporate Resolution of the Foreign Investor to Invest in Nepal.
5. Financial Credibility Certificate issued by any bank of the country of the Residence/Registration of the Foreign Investor.
6. Documents stating the Source of Investment and Time Schedule of Investment
7. Power of Attorney authorizing an Individual to complete the approval and Registration Process at the relevant authorities.
8. Passport of Foreign Investor in case of Foreign Investor is a person and passport of directors of foreign investor in case of Entities.
9. Commitment Letter By Investor stating that Foreign Investor shall not repatriate investment till one year.
10. Joint Venture Agreement (this will not be required if the Local Company will be a fully owned subsidiary or if the foreign Investor is an Individual)

Four Ace Business Solutions provide professional service in registering FDI company in Nepal.