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Liaison Office Registration Process in Nepal

1.Governing law of Liaison Office in Nepal

This article explains details regarding the registration of liaison office of foreign company in Nepal. The registration of a liaison office in Nepal is governed by the Companies Act, 2006 (2063) (“Companies Act”). Section 154 of Companies Act incorporates the provision related to the registration of liaison office.

2. Governing authority

Office of Company Register (‘OCR”) is the governing authority to register a liaison office in Nepal.

 

3. Activities that liaison office are allowed to perform

Unlike the branch office the liaison office is not allowed to undertake any income generating or advertisement activities. The liaison office can only be used as a contact point for the foreign company and other local parties to communicate, coordinate and regulate the relationship.

 

The liaison office is allowed to:

  • a. To work as the point of contact and maintain liaison on behalf of foreign company,
  • b. Assist individuals to import and use of foreign companies’ products without taking any remunerations and 
  • c. Coordinate with Nepalese Agent if appointed by the foreign company.

 

Liaison office establishment does not provide the legal status of separate legal personality. It shall be considered as the part of foreign company operating in Nepal.

 

4. Minimum capital requirement for investment in liaison office

There is no minimum capital threshold for the investment of liaison office, Companies Act is silent for the same. Generally, the foreign companies inject the investment amount considering the operation cost. 

 

5. Liaison office registration process in Nepal

Following steps are followed for liaison office registration: 

Liaison Office Registration in Nepal

Kindly Note:  As a matter of practice separate approval from the government authority shall not be required for registration of liaison office. 

 

6. Timeline

The timeline for registration of a liaison office in Nepal is usually 2 to 3 weeks. 

 

7. Documents required for registration of liaison office in Nepal

Following are the documents required for liaison office registration: 

S.N.DocumentsNotarization
1Certificate of Registration, Memorandum of Association, Article of Association of the Foreign Company and its Nepalese Translation.Yes
2Application for Liaison Office RegistrationNot Applicable
3Board Resolution of the Foreign Company to set up a liaison office.No
4Signed Copy of Company ProfileNo
5Copy of passport of all directors of CompanyYes
6Copy of citizenship certificate of Nepal Representative authorized to receive notices (Notarization should be done from Nepalese Notary Officer)Yes
7Letter of appointment of Authorized RepresentativeNo
8Proposed Plan of Liaison OfficeNo
9Power of AttorneyYes
10Declaration of director or their representative of Company that the information submitted is correct and accurateNo

 

8. Government fee applicable for branch office registration 

Government fee of the registration of the liaison office that need to be paid before OCR is NPR. 50,000.

 

9. Compliance requirement

Following are the post compliance requirement of liaison office in Nepal:

  • a. Submit 3-month compliance document before OCR;
  • b. Appoint Auditor to prepare annual financial statement (audit report) of liaison office;
  • c. Submit the financial statement at OCR within 6 months of completion of each fiscal year;
  • d. Submit the financial statement to its head office within 3 months from its preparation date and
  • e. Update document at OCR in case there is change in name and address of the foreign company. 

 

Note:Liaison office has obligation to perform the compliances applicable pursuant to prevailing Nepalese law including Labor Law, Social Security Law, Tax Law etc. during the process of its operation in Nepal. 

 

10. Liaison office different from a branch office

  • a. Unlike branch office, liaison office is not allowed to do any income earning activities in Nepal. The liaison office can only be used as a contact point for the foreign company and other local parties to communicate, coordinate and regulate the relationship;
  • b. As a matter of practice unlike branch office liaison office are not required to take any approval from the concerned authority for establishment;
  • c.  Activities such as entering into a contract for transaction and marketing and advertisement of product of the company is restricted for liaison office.

 

 

For more details regarding the registration of the branch office in Nepal please visit the article published at our law firm website.  Link:  Branch Office Registration in Nepal

 

Date of Publication: 18 August 2023 

 

 

 

Related Article Link: 

Please click the article published at our law firm website, which are related to the above article topic: 

Company Registration Process in Nepal
Branch Office Registration Process In Nepal
ESTABLISHMENT OF BUSINESS IN NEPAL BY FOREIGN INVESTORS

 

 

Disclaimer: Bhandari Law and Partners is one of the leading law firm in Nepal  with team of best professional lawyers in Nepal.This article published on website of the law firm is just for information purpose only. It shall not be taken as the legal advice, advertisement, personal communication, solicitation or inducement. Bhandari Law and Partners or any of the team members of the firm shall not be liable for the consequence arising of the information provided. As the factual situation may be different on your case, thereof if you need further legal advice on the subject matter, please Contact Us.

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