# An Overview of Corporate Law in Nepal

Corporate law in Nepal has undergone significant changes in recent years, with the introduction of new legislation and amendments to existing laws. This article provides a comprehensive overview of the current corporate legal framework in Nepal.

## Company Act 2063 (2006)

The Company Act 2063 (2006) is the primary legislation governing companies in Nepal. It provides the legal framework for the incorporation, operation, and dissolution of companies. Key provisions include:

- Types of companies (private, public, non-profit) - Incorporation procedures - Corporate governance requirements - Rights and duties of shareholders and directors - Financial reporting and disclosure requirements

## Recent Developments

In recent years, Nepal has introduced several reforms to improve the ease of doing business and attract foreign investment. These include:

1. Online Company Registration: The Office of the Company Registrar now allows online registration of companies, simplifying the incorporation process. 2. Foreign Investment and Technology Transfer Act (FITTA) 2019: This new legislation has replaced the previous FITTA 1992, providing a more investor-friendly framework for foreign investment. 3. Industrial Enterprises Act 2020: This act provides various facilities and incentives for industrial enterprises.

## Corporate Governance

Good corporate governance is increasingly important in Nepal. The Company Act requires companies to maintain proper books of accounts, prepare financial statements, and have them audited annually. Listed companies must also comply with the corporate governance requirements of the Securities Board of Nepal (SEBON).

## Conclusion

Understanding the corporate legal framework is essential for businesses operating in Nepal. As the legal landscape continues to evolve, staying informed about the latest developments is crucial for compliance and strategic decision-making.