Arbitration

Bhandari Law and Partners is recognized as an expert-level service provider for international arbitration in Nepal. Our team has deep, working knowledge of arbitration built through years of actually practicing in the sector, and we represent clients in both international and domestic arbitration, acting for national and international companies alike. Our practice covers the full life cycle of a dispute, for both claimants and respondents — from pre-contract strategic advice and negotiation, through drafting arbitration agreements, initiating and pursuing claims, defending against them, securing interim measures, and enforcing the resulting award.

The Legal Framework

Arbitration in Nepal is governed by the Arbitration Act, 2055 (1999), which replaced the earlier Arbitration Act of 2038 (1981) and brought Nepal's regime closer in line with international standards, drawing on the UNCITRAL Model Law on International Commercial Arbitration. Arbitration reaches Nepali commercial disputes through two main routes: parties voluntarily agreeing to arbitration clauses in contracts — loan agreements, joint ventures, EPC and construction contracts — and statutory submission, most notably under Section 58 of the Public Procurement Act, 2063 (2007), which effectively mandates arbitration for public procurement disputes, and Section 40 of FITTA, 2019, which requires arbitration for disputes between the Government of Nepal and foreign investors, seated in Nepal and conducted under the UNCITRAL Arbitration Rules absent contrary agreement.

The framework was updated further through 2025 amendments to the Arbitration Act, which introduced a formal fast-track arbitration procedure, cut the enforcement timeline for awards under expedited proceedings, and narrowed the grounds on which a party can challenge or set aside an award — including barring courts from re-examining evidence during setting-aside proceedings. Ad hoc arbitration, often conducted under UNCITRAL Rules without the oversight of a formal arbitral institution, remains widely practiced in Nepal, which makes getting the arbitration agreement and procedural choices right at the drafting stage especially important — there often isn't an institution's own rules and secretariat to fall back on if something is left ambiguous.

Nepal's most active areas for arbitration track its economy — large-scale infrastructure, hydropower, construction, and public procurement dominate the caseload, given how much of this work is government-procured and how often it involves foreign contractors and suppliers.

What We Do

Pre-Contract Strategy and Negotiation

Before a dispute even exists, we advise clients on structuring contracts and negotiating terms in a way that protects their position if a disagreement arises later.

Drafting Arbitration Agreements

We draft arbitration clauses and standalone arbitration agreements, paying close attention to seat, governing rules, and institutional choice — decisions that matter far more once a dispute is underway than they seem to at signing.

Initiating and Pursuing Claims

We represent claimants in bringing arbitration proceedings, building and presenting the case through to award.

Defending Claims

We represent respondents defending against arbitration claims, working to protect a client's position at every stage of the proceeding.

Interim Measures

We seek interim relief where a client's position needs protecting before a final award is issued — securing assets, preserving evidence, or preventing a counterparty from taking action that would undermine the eventual outcome.

Enforcing Arbitration Awards

We carry successful awards through to enforcement, both domestically and, where the award was made abroad, through Nepal's enforcement process for foreign awards.

Industries We Cover

Our arbitration practice spans construction, road and transportation projects, telecoms, insurance, energy and natural resources, commodities, chemicals, technology, banking and financial services, international trade, manufacturing, and leisure, along with disputes arising out of shareholder and joint venture agreements.

Our Experience

Our team has handled complex, multi-jurisdictional arbitrations before arbitral institutions both in Nepal and abroad, and we maintain a dedicated team with the specific expertise complex arbitration work actually requires — because a dispute involving a hydropower contract, for instance, calls for a genuinely different skill set than one arising from a shareholder disagreement, even though both run through the same procedural framework.

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