Introduction to Non-Profit Companies Nepal
Online Registration of Non-Profit Company Nepal. Non-profit companies in Nepal fall under Section 166 of the Companies Act, 2063 (2006). These organizations aim to promote social welfare, education, health, culture, and environmental protection. They do not distribute profits to their members. All earnings must be used for the organization’s stated goals. The Office of the Company Registrar (OCR) manages their registration and compliance. These companies have limited liability and operate without share capital. Medha Law and Partners Is a leading law firm in Nepal.
Who Can Register a Non-Profit Company
A minimum of five individuals can register a non-profit company in Nepal. They must be Nepali citizens or, in some cases, include approved foreign nationals. Each promoter should be over 18 years old and capable of entering into contracts. Institutions and associations may also be promoters if permitted by their legal framework.
Where to Register Non-Profit Companies Nepal
The Office of the Company Registrar (OCR), under the Ministry of Industry, Commerce and Supplies, is responsible for registering non-profit companies. Located in Tripureshwor, Kathmandu, the OCR now offers an online system that allows users to submit documents and track the status of their application.
Online Procedure for Non-Profit Registration
Follow these steps to register a non-profit company online in Nepal:
- Visit www.ocr.gov.np
- Create a user account with contact details
- Complete the non-profit application form
- Upload required documents in PDF format
- Submit the form for review
- Pay government fees online
- Wait for OCR verification and approval
- Receive the registration certificate digitally
The online system reduces the need for physical visits to the office.
Required Documents for Non-Profit Company
Applicants must submit the following documents:
- Signed application form from all promoters
- Memorandum of Association (MOA)
- Articles of Association (AOA)
- Citizenship or passport copy of each promoter
- Passport-sized photographs of each promoter
- Description of the company objectives and activities
- Proof of office address (rental or ownership documents)
- Minutes of the promoters’ meeting
- Power of attorney, if applicable
Documents must be in Nepali or officially translated.
Timeframe for Non-Profit Registration Nepal
It typically takes 7 to 15 working days to complete registration. Processing time depends on the accuracy and completeness of the application. Delays may result from missing documents, verification issues, or internal backlogs at OCR.
Government Fees for Non-Profit Entity
According to the Companies Act and Rules, the registration fee for non-profit companies is NPR 1,000. The fee may increase slightly if corrections are necessary. Since these companies have no share capital, no capital-based fees apply.
Legal Framework for Non-Profit Companies
Non-profit companies are governed by Section 166 of the Companies Act, 2063. They are not allowed to distribute dividends. All income must support the public interest goals defined in the MOA. The OCR monitors compliance. Companies must also file periodic audits and legal documents.
Objectives Permitted Under Section 166
Under Section 166, companies may pursue the following objectives:
- Promote commerce, art, science, literature, and education
- Protect the environment and natural resources
- Support public health and social services
- Advocate for disadvantaged communities
- Engage in other public-benefit activities
The OCR evaluates whether the proposed objectives meet the required standards.
Common Challenges Faced During Registration
Applicants may face the following difficulties:
- Incomplete or improperly filled documents
- Objectives that are unclear or non-compliant
- Promoters unavailable for verification
- Errors in MOA or AOA formatting
- Inadequate proof of office address
Addressing these issues beforehand improves approval chances.
Post-Registration Reporting Obligations
After registration, companies must meet the following obligations:
- Submit annual audit reports
- Notify OCR of any amendments to MOA or AOA
- Report changes in board members or office address
- Maintain accurate accounting records
- Submit yearly income and expense statements
Failure to comply may result in penalties or deregistration.
Differences with NGOs and Trusts
Key differences between non-profit companies, NGOs, and trusts include:
- Non-profits register under the Companies Act; NGOs register under the Social Welfare Act
- Non-profits must follow corporate governance rules
- Annual audit submission is mandatory
- Non-profits have limited liability and formal legal identity
- Governance is structured through a board of directors
NGOs and trusts operate under different legal regimes.
Verification Process by OCR Nepal
OCR verifies applications by:
- Checking uploaded documents
- Reviewing objectives for legality and compliance
- Verifying the identity of each promoter
- Validating the office address
- Issuing approval or rejection based on internal review
This ensures only qualified applications are approved.
Final Checklist Before Registration Online
Applicants should confirm the following:
- MOA and AOA match OCR format
- Promoter ID copies and photos are clear
- Valid office address documents are prepared
- Objectives are lawful and clearly stated
- Online form entries are accurate
Double-checking these items reduces rejection risk.
Services Available for Non-Profit Registration
Professional services available for support include:
- Drafting MOA and AOA
- Document translation and notarization
- Office address verification
- Online application submission support
- Ongoing compliance and legal advisory
Medha Law and Partners provides complete assistance for non-profit company setup and compliance.
FAQs
What is a Section 166 company?
It is a non-profit company formed under Section 166 of the Companies Act, 2063. It uses all income for public benefit and cannot distribute profits.
Can I start this alone?
No. At least five individuals are needed to register a non-profit company in Nepal.
Do I need an office address?
Yes. You must submit rental or ownership documents of a valid physical address.
Is donation allowed legally?
Yes. Donations are legal if used only for the company’s public interest goals.
Who oversees these companies?
The Office of the Company Registrar (OCR) supervises and monitors these entities.
Can this be converted later?
No. A Section 166 company cannot convert into a profit-based company.
Are board members needed?
Yes. The company must have a Board of Directors as listed in the AOA.
What fees apply here?
NPR 1,000 is the government registration fee for a non-profit company.
Do I need yearly audits?
Yes. Non-profit companies must submit audited financials annually.
Can foreigners join this?
Yes. Foreign nationals may join, subject to regulatory approval and documentation.