Construction Company Registration Process in Nepal

This article outlines the registration process for a construction company in Nepal and provides the detailed procedure for obtaining the necessary construction license.

 

The major law governing the registration of the construction  company and obtaining construction license are as mentioned:

 

SN	Act	Scope
1	Act	Scope
2	Company Act 2063	Incorporation and regulation of Company
3	Construction Business Act, 1999	Regulation of License
4	Construction Business Regulations, 2000	Detailed requirements for obtaining the construction Company License

 

The process for registration of a construction company along with obtaining a construction license are is outlined as below:

 

• Step 1: Incorporate the company with the Office of the Company Registrar (OCR) 
• Step 2: Register the business with the respective local government authority.
• Step 3: Complete tax registration with the Inland Revenue Office (IRO).
• Step 4: Register the company with the Department of Industry (DOI).
• Step 5: Prepare all necessary supporting documents and apply for the Construction License
• Step 6: Obtain the relevant operating license from the local government or Ministry of Urban Development.

 

Please note: D-Class licenses are provided by local government whereas A, B and C license are provided by the Nepal Government through the recommendation of Committee formed under the Section 15 of Construction Business Act,2055 of Nepal.

 

The timeline for the company registration would take around 10-15 days and further obtaining of a license would vary from type of class of license which generally takes 4-8 weeks.

 

The construction license are categorized into 4 types based on their capacity. The running capital of different class of license are:

 

S.No.	Class	Working Capital	Capacity
1	Class “A”	More than 10 Million	Construction project with more than 20 Million
2	Class “B”	More than 5 Million	Construction project from 6 Million to 20 Million
3	Class “C”	More than 1 Million	Construction project from 2 Million to 10 Million
4	Class “D”	More than 1 Hundred Thousand	Construction project up to 3 Million

 

The Construction Rules outline separate qualifications for construction licenses, illustrated in the table below.

 

Class “A” Construction License

S.No.	Area	Requirement
1	Financial Capacity	Minimum running capital of NPR 1,00,00,000 (One Million).
2	Work Experience	Satisfactorily completed 4 public construction works valued at a minimum of NPR 10,000,500 each, OR Various such works valued at a total of NPR 60,000,000, OR Minimum of 2 civil engineers with at least 20 years of experience in public construction, OR Company with an engineer as promoter/shareholder having NPR 60 million construction experience in the last 10 years.
3	Human Resources	Must employ full-time: 2 civil engineers (graduation level) 4 civil technicians (certificate level) 2 graduates in any subject 3 certificate-level holders in any subject 1 graduate in commerce 1 certificate-level holder in commerce
4	Machinery & Equipment	Must own at least: Theodolite – 2 units Level instrument – 4 units Dump truck or truck – 2 units Water pump – 3 units Concrete mixer – 3 units Concrete vibrator – 5 units Lab equipment – 1 full set Any one of the following: Backhoe, Excavator, Bulldozer Optional Equipment (At least 4 items required): Loader Bitumen distributor/sprayer Water tanker/sprayer Motor grader Three-wheeler roller One-ton roller Pneumatic roller Bitumen paver Asphalt mix plant Crane Forklift Crusher Compactor Vibrating roller Hydraulic auger Benz Building hoist

 

Class “B” Construction License

S.No.	Area	Requirement
1	Financial Capacity	Minimum running capital of NPR 50,00,000 (5 million).
2	Work Experience	Four public construction works, each worth at least NPR 8 million, OR Various such works totaling NPR 20 million, under contracts concluded by the company itself, OR At least 1 civil engineer with 10+ years’ experience in public construction works, OR Shareholder or promoter is an engineer (or equivalent) with NPR 20 million worth of construction works in the last 10 years.
3	Human Resources	Must employ at least: 1 civil engineer (graduation level) 2 civil technicians (certificate level) 2 graduates in any subject 2 certificate-level holders in any subject 1 commerce graduate
4	Machinery & Equipment	Must own at least: Theodolite – 1 unit Level instrument – 2 units Dump truck or truck – 1 unit Water pump – 2 units Concrete mixer – 2 units Concrete vibrator – 4 units Lab equipment – 1 complete set Any one of the following: Backhoe, Excavator, Bulldozer Optional Equipment (Any 2 items required): Loader Bitumen distributor/sprayer Water tanker/sprayer Motor grader Three-wheeler roller One-ton roller Pneumatic roller Bitumen paver Asphalt mix plant Crane Forklift Crusher Compactor Vibrating roller Hydraulic auger Benz Building hoist

 

Class “C” Construction License

S.No.	Area	Requirement
1	Financial Capacity	Minimum running capital of NPR 10,00,000 (1 million).
2	Work Experience	Four public construction works, each valued at least NPR 1 million, OR Various such works totaling NPR 4 million, under contracts executed by the company itself, OR One civil engineer with at least 5 years' experience in public construction works, OR Two civil overseers (certificate-level in civil engineering), OR A shareholder or promoter who is an engineer/overseer (or equivalent) with construction works experience totaling NPR 10 million in the last 5 years.
3	Human Resources	Must employ full-time at least: 1 civil engineer (graduation level) 2 civil technicians (certificate level) 2 graduates in any subject 3 certificate-level holders in any subject 1 commerce graduate
4	Machinery & Equipment	Must own at least: Level instrument – 2 units Water pump – 2 units Concrete mixer – 1 unit Concrete vibrator – 3 units Optional Equipment (At least 1 required): Loader Bitumen distributor/sprayer Water tanker/sprayer Motor grader Three-wheel roller One-ton roller Pneumatic roller Bitumen paver Asphalt mix plant Crane Forklift Crusher Compactor Vibrating roller Hydraulic auger Benz (heavy vehicle) Building hoist

 

Class “D” Construction License

S.No.	Area	Requirement
1	Financial Capacity	Minimum running capital of NPR 1,00,000 (1 hundred thousand).
2	Work Experience	Not Required
3	Human Resources	Must employ full-time: 1 technician with a certificate in civil engineering 1 administrator with a certificate in any subject 1 person with a certificate in commerce
4	Machinery & Equipment	Must own at least: Level instrument – 1 unit Water pump – 1 unit Concrete vibrator – 1 unit

 

The following documents are to be submitted and complied for applying for all category of construction license. 

 

1. Ownership Certificate

2.  Insurance of equipment

3. Certification by mechanical engineer (graduate and NEA member) confirming equipment is in good condition

4. Equipment must not be sold or disposed of for at least 2 years from the date of registration.

5. Machineries and equipment should not be more than 15 years old.

 

The foreign direct investment in the Construction company is allowed in full capacity. If any foreigner company wants to operate the through international competitive bidding, they  can obtain temporary permits when partnering with local contractors on domestic bids for projects valued over NPR 60 million.

 

Date of Publication: 18 August 2025

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