Foreign investment in Nepal follows a fixed sequence: confirm the activity is not restricted, obtain foreign investment approval from the Department of Industry or the Investment Board Nepal, register the company with the Office of the Company Registrar, register for tax, bring the capital in through banking channels, and have it recorded so Nepal Rastra Bank can approve repatriation later.
Why the order matters more than the paperwork
Each step in this sequence produces a document that the next step needs. Doing them out of order is the most common way an otherwise sound investment ends up stuck, and the expensive version of that mistake is moving money before it has anything to attach to. Capital that arrives in Nepal without approval recorded against it is capital that has, in regulatory terms, not arrived as foreign investment at all.
No fee, tax rate, capital threshold or processing time is given below. All of them move by ordinance and by budget speech, and a stale number on a page that ranks is worse than no number. What is given is the structure, which changes far more slowly.
Step one: confirm the activity is not restricted
Before anything else, establish that what you intend to do is open to foreign investment. The schedule of restricted industries under the Foreign Investment and Technology Transfer Act 2019 has covered travel agency, guiding, trekking and mountaineering guiding, and rural tourism including homestay. Hotels and resorts are not on it. What is and is not allowed in Nepali tourism sets that out in full.
Ask the Department of Industry in writing, describing the activity as it will actually operate rather than as a category name. A property that lets rooms is a hotel. The same property selling packaged treks from its own desk is doing something else as well, and the answer for one is not the answer for the other. If the intended activity turns out to be restricted, the partnership route is the thing to read next, and it is not a way of owning the restricted business.
Step two: foreign investment approval
Approval comes from one of two bodies, and which one depends on the size of the project. The Department of Industry approves most foreign investment. The Investment Board Nepal handles projects above a size threshold, together with certain infrastructure categories. There is also a minimum foreign investment threshold, set in rupees and revised periodically, below which foreign investment is not approved at all. The Department of Industry publishes the current figure.
The application is made before the company exists in most routes, and it is made on the basis of a described project: what will be built or acquired, where, by whom, with how much, and over what period. The approval that comes back is specific to that project. A materially different project needs the approval amended rather than assumed.
Step three: register the company
The vehicle is registered with the Office of the Company Registrar under the Companies Act. For a foreign investor this is usually a private limited company in Nepal, with the foreign shareholding as approved at step two. Individuals do not generally hold Nepali land or operate a licensed property directly, which is part of why the company comes first and the lease comes after.
Registration fixes things that are awkward to change later: the objects of the company, the share structure, the composition of the board, and the articles that govern what happens if the shareholders fall out. That last one is worth spending real money on at this stage rather than discovering its absence during a dispute.
Step four: register for tax
Tax registration is with the Inland Revenue Department, which issues the permanent account number the company trades under and handles value added tax registration where the business is required to hold it. Registration is also what makes the company auditable, and a foreign-invested company is audited annually by a licensed Nepali auditor.
Rates are not quoted here. They are set in the annual budget and they change. Any figure you have been given by a consultant should be checked against the current Finance Act before it goes into a model.
Step five: sector and local registration
Company registration is not an operating licence. A hotel or resort also registers under the tourism legislation, and the requirements differ by the class and size of the property, so confirm which regime applies to yours rather than assuming the smallest one. Local registration with the municipality or rural municipality is separate again, and so are building permission, land use consent and anything triggered by proximity to a protected area.
Practice at local level varies considerably between municipalities, particularly in Karnali, where some offices process very few of these. Building in more time here than a Kathmandu adviser suggests is realistic rather than pessimistic. What building or buying accommodation in West Nepal involves covers the ground-level version of this.
Step six: bring the capital in through banking channels
This is the step that decides whether the money can ever leave again. Approved foreign investment is remitted into Nepal through the banking system, into the company account, and recorded against the approval. Nepal Rastra Bank is the authority for that record. Cash carried in, money paid to a partner abroad, or funds routed through a personal account do not create the record, and no amount of later paperwork reliably creates it retrospectively.
Keep the remittance advices, the bank certificates and the approval correspondence together and permanently. Repatriation years later is assessed against exactly these documents, quite possibly by officials who were not in post when the investment was made.
Step seven: visas for the people involved
A business visa is available in connection with an approved investment, and its terms depend on the amount invested and the status of the investor. It is granted against the investment rather than the intention to invest, so it is a consequence of the steps above rather than a substitute for them. The visa on arrival guide covers the ordinary tourist route, which is a different thing entirely and does not permit running a business.
Step eight: repatriation
Repatriation of dividends, of proceeds from selling shares, and of capital on winding up all require Nepal Rastra Bank approval. The approval depends on the original investment having been brought in and recorded properly, on tax having been paid and the accounts audited, and on the relevant company law steps having been completed for the transaction in question.
None of that is unusual by regional standards. What is unusual is how completely it depends on decisions made at step six, often years earlier. This is the reason the sequence is worth following even when a shortcut is offered.
| Step | Body | What it produces |
|---|---|---|
| Confirm the activity is open | Department of Industry | A written position on whether foreign investment is permitted |
| Foreign investment approval | Department of Industry, or Investment Board Nepal above a size threshold | Project-specific approval to invest |
| Company registration | Office of the Company Registrar | The Nepali company and its share structure |
| Tax registration | Inland Revenue Department | Permanent account number, and value added tax registration where required |
| Sector and local registration | Tourism authorities and the local municipality | Operating licence, building and land use consents |
| Inward remittance | Commercial bank, recorded with Nepal Rastra Bank | The record that makes repatriation possible |
| Business visa | Department of Immigration | Permission to reside in connection with the investment |
| Repatriation | Nepal Rastra Bank | Approval to remit dividends, sale proceeds or capital out |
What this sequence does not tell you
It does not tell you how long any of it takes. Published service standards exist and lived experience varies against them, particularly where a local office handles few foreign-invested applications. It does not tell you what it costs, because fees change. It does not tell you which structure suits your situation, because that is a question for a licensed adviser who has seen your actual position.
It also does not settle every case. Practice has varied on some points, including how activities that sit near the edge of a restricted category are treated, and the honest answer where that happens is to get the position in writing rather than to rely on what somebody else was allowed to do. The regional landscape covers where in western Nepal any of this is likely to be worth the effort.
This is not legal or financial advice. Nepal's foreign investment rules change by ordinance and budget, and the schedule of restricted sectors is amended from time to time. Confirm the current position with the Department of Industry, the Investment Board Nepal or Nepal Rastra Bank, and take advice from a licensed Nepali lawyer or auditor before committing money.
Frequently Asked Questions
Who approves foreign investment in Nepal?
The Department of Industry approves most foreign investment. The Investment Board Nepal handles projects above a size threshold and certain infrastructure categories. Company registration is separate and sits with the Office of the Company Registrar, and the movement of capital in and out is approved by Nepal Rastra Bank.
Do I register the company before or after investment approval?
Foreign investment approval generally comes first, because the approval is granted for a described project and the company is then registered with the approved foreign shareholding. Confirm the current order with the Department of Industry, since procedure has been revised more than once and an out-of-date sequence wastes a filing.
Can I bring investment money into Nepal as cash?
Approved foreign investment is remitted through the banking system into the company account so that it is recorded against the approval. Capital that arrives outside that channel has no record behind it, and Nepal Rastra Bank assesses any later repatriation against exactly that record.
How do I take profits out of Nepal?
Repatriation of dividends, share sale proceeds or capital requires Nepal Rastra Bank approval, and it depends on the original investment having been brought in and recorded correctly, on tax being paid, on the accounts being audited, and on the company law steps for that transaction being complete.
Is there a minimum foreign investment amount in Nepal?
Yes. There is a minimum threshold set in rupees and revised periodically by government decision. The figure is not quoted here because it has changed more than once. The Department of Industry publishes the current one, and it is worth confirming in writing before planning around any number.
Does approval let me operate straight away?
No. Foreign investment approval and company registration create the vehicle. Operating a hotel or resort also needs registration under the tourism legislation, local registration with the municipality, and the building and land use consents that apply to the site. Requirements differ by the class and size of the property.
Can I get a visa on the strength of planning to invest?
A business visa is granted in connection with an approved investment rather than an intention to invest, with terms depending on the amount and the investor status. A tourist visa does not permit running a business, whatever the length of stay it allows.
How long does the whole process take?
No timeline is given here, because published service standards and lived experience diverge, and local offices in Karnali handle very few foreign-invested applications. Ask your Nepali adviser for recent comparable cases rather than a published figure, and plan around the slower answer.