Travel and Tour Agencies Registration Process in Nepal

This article aims to provide an overview on the incorporation and registration process of travel and tour agencies in Nepal with detailed information on the classification of different kinds of travel agencies, etc.

 

Below are the laws that govern the registration process of tours and travel agencies in Nepal. These laws mandate how the registration process should take place:

 

S.N	Governing Law	Subject Matter of Governance
1	Companies Act, 2006	Establishes legal procedures for company incorporation and compliance
2	Tourism Act, 2035 (1978)	Governs the functioning, licensing, classification of operations of travel agencies
3	Travel and Trekking Agency Rules, 2005	Provides guidelines on the registration, licensing, renewal of license for travel agencies in Nepal

 

 

The table below mentions the list of governing authorities who act as key figures to incorporate and register a travel agency in Nepal:

 

S.N	Governing Authority	Subject Matter of Governance
1	Office of Company Registrar (OCR)	Registers new companies
2	Inland Revenue Office (IRD)	Provides PAN to businesses and registers them for VAT
3	Department of Industry (DoI)	Provides Industry Registration Certificate to new businesses
4	Department of Tourism (DoT)	Provides license to travel agencies, registers them

 

 

3.1 Steps of Incorporation of Tours and Travels Agencies in Nepal

 

Following steps mention how to register and operate travel agencies in Nepal.

 

 

• Step: 1: Registration of Company before Office of Company Registrar 

• Step: 2: Receive the Tax Certificate from Inland Revenue Department 

• Step: 3: Register the business at the ward office where the company has registered address

• Step: 4: Open Bank Account and Inject the Capital of Company and receive the  Shareholder registry from OCR. 

• Step: 5: Industry Registration of Company

•  Step: 6: Apply for a Travel Agency License with the Department of Tourism and pay the required fees.  

 

After these steps, if all the documents are valid then one will obtain a travel agency license that is valid for 5 years. 

 

Kindly Note: Depending on your business structure ensure that you have minimum current or paid-up capital of the following amounts: 

Firms                                     : Min NPR 5,00,000

Private Limited Company      : Min NPR 25,00,000

 

3.2. Timeline of the entire process 

The entire registration process of the Travel and Tour Agencies in Nepal takes 45 to 60 days.  

3.3. Document to be submitted before Office of Company Registrar for Company Registration

S.N	Documents
1	Application for registration of company in the standard format
2	Memorandum of Association and Article of Association of Nepalese Entity
3	Shareholder agreement if any
4	Citizenship Certificate/Passport of investor in case of an individual
5	Copy of certificate of registration and other registration documents (memorandum of association, articles of association) of corporate entity in case a corporate entity wants to invest in the company
6	Resolution of the corporate entity for incorporating the entity in case a corporate entity wants to invest in the company

 

3.4 Requirements to be submitted before Department of Tourism to Receive License

S.N	Documents Required
1	Company Registration Certificate (Notarized)
2	PAN and VAT Registration Certificates (Notarized)
3	Bank Guarantee of NPR 5 Lakhs for 5 years
4	Proof of minimum paid up capital (Capital requirement differs according to the business structure)
5	Citizenship Certificate/Passport of investor in case of an individual
6	Resolution of the corporate entity for incorporating entity in case a corporate entity wants to invest in the company
7	Tax Clearance Certificate (if the company is over 1 year old)
8	Audit Report (if the company is older than 1 year)
9	Passport-Size Photographs of the company’s owners/directors

 

3.4. Government Fee For Registration

 

S.N	Particulars	Rate of Government Fee
1	Fee to be paid before OCR for company Registration	Depends upon the authorized capital of company
2	Business Registration at Ward Office	Approx. NPR 10,000 to NPR 20,000 (USD 75 to 150) (Please note that the business registration fees are specific to each local level and subject to change every fiscal year.)
3	House Rent Tax	10% of House Rent Amount per month (During the incorporation need to pay 4 to 6 months house rent tax)
4	Fee to be paid before Industry Registration	Depends on capital of the industry
5	Fee to be Paid before Department of Tourism	Application Fees: NPR 100 License Fees: NPR 15,000

 

 

Rule 7 of the Travel and Trekking Agency Rules, 20962 outlines the duration and renewal process for licenses. Following things have to be kept in mind while renewing the license: 

 

01. The license is valid for five years. 

02. To renew the license, the application must be submitted before the expiration date, along with a renewal fee of 25,000 rupees.

03. Submission of renewal application after the expiry of license warrants additional fees in the following manner: 

             a. Renewal after three months of expiry: 25% additional fee 

             b. Renewal between three to six months after expiry: 50% additional fee 

             c.  If the license is not renewed within these specified periods, it will automatically be canceled.

 

Foreign Investor are not allowed to open travel and Tour agencies in Nepal as such business is listed under the Negative List of Foreign Investment and Technology Transfer Act, 2019 (2075). Neither are they allowed to open the company in the partnership by distributing certain share to the local citizen of Nepal. 

 

However, foreign investor can sale their products through appointing the distributor or agent after executing the distributorship or agency agreement. 

Date of publication : 2024/12/30

 

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.