Act No. 20 of the Year 2014 (1958)
Date of Authentication: 2014-11-2 (13 February 1958)
Date of Publication: 2014-11-13 (24 February 1958)
This Act was enacted to establish legal provisions for the registration of private firms in Nepal. It governs the procedures, requirements, and legal obligations concerning the registration and regulation of private firms. Medha Law and Partners Is a leading law firm in Nepal.
Amendments:
- First Amendment – Private Firm Registration (First Amendment) Act, 2017 (1961)
- Authentication:1.14 (26 April 1961)
- Publication:1.16 (28 April 1961)
- Second Amendment – Some Nepal Laws (Amendment and Rearrangement) Act, 2020 (1964)
- Authentication & Publication:11.16 (28 February 1964)
- Third Amendment – Judicial Administration Reform (Fourth Amendment) Act, 2043 (1986)
- Authentication:7.24 (10 November 1986)
- Fourth Amendment – Private Firm Registration (Second Amendment) Act, 2044 (1987)
- Authentication:6.9 (25 September 1987)
- Fifth Amendment – Administration of Justice Act, 2048 (1991)
- Authentication:2.16 (30 May 1991)
- Sixth Amendment – Amending Some Nepal Acts to Maintain Gender Equality Act, 2063 (2006)
- Authentication:7.17 (3 November 2006)
- Seventh Amendment – Republic Strengthening and Some Nepal Laws Amendment Act, 2066 (2010)
- Authentication:10.7 (21 January 2010)
“An Act enacted to make provisions regarding the registration of private firms.”
“Whereas, it is expedient to make provisions for the registration of private firms engaged in trade and industry, and related matters, to safeguard the convenience and economic interest of the general public;
Now, therefore, His Majesty the King hereby enacts and promulgates this Act.”
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Short Title, Extent, and Commencement:
(1) This Act shall be called the Private Firm Registration Act, 2014 (1958).
(2) It shall extend throughout Nepal.
(3) It shall come into force immediately.
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Definition: In this Act, unless the subject or context other wise requires;
(a) “Private firm” means firm or company or kothi constituted by a person under any name for exporting of industrial products or import trade.
(b) “Export” means an act of exporting goods from Nepal to a foreign country.
(c) “Import” means an act of importing goods from a foreign country into Nepal.
(d) “Notification” means an order published in Nepal gazette.
(e) “Concerned Department” means Department of Commence in the case of commerce related firm, Department of Cottage and Rural Industry in the case of cottage and rural industry, and Department of Industry for any other industry.
(f) “Prescribed” or as “prescribed” means prescribed or as prescribed in the Rules framed under this Act.
- Restriction on Operation Without Registration:No person shall operate a private firm without registering it with the concerned Department in accordance with this Act after its commencement.
- Submission and Registration of Private Firm: Private Firm Registration Act, 2014 (1958)
(1) A person intending to register a private firm shall submit an application in the prescribed format, with the prescribed fee, to the concerned Department. The application shall include:
(a) Name of the private firm;
(b) Objectives, functions, and particulars of goods or commodities to be transacted;
(c) Address of the private firm;
(d) Name and address of the owner, including names of father, mother, grandfather, and grandmother;
(e) Other particulars as prescribed by the Government of Nepal via Notification in the Nepal Gazette.
(2) Upon receipt, the concerned Department shall inquire into the application and, if satisfied with the particulars and reason to operate the firm, shall register it in the prescribed register and issue a certificate in the prescribed format.
(3) No person shall register more than one private firm with the same or similar commercial objectives.
- Validity and Renewal of Certificate: The validity, renewal procedure, and fee for the certificate of a private firm registered under this Act shall be as prescribed.
- Requirement of approval to change the particulars: Any change to the particulars submitted under Section 4(1) requires prior notice to the concerned Department within the prescribed period and approval before the change is effected.
- Invalidity of Transactions by Unregistered Firms: No transaction conducted in the name of a private firm not registered under this Act shall be valid.
7a. Concerned Department may seek particulars: Private Firm Registration Act, 2014 (1958)
(1) The concerned Department may request account details of a private firm registered under this Act.
(2) The firm must submit the requested particulars to the Department.
7b. Cancellation of Registration:
(1) The concerned Department may cancel the registration of a private firm in the following cases:
(a) Failure to renew within the prescribed period;
(b) Submission of an application by the owner with valid reasons;
(c) Registration based on false particulars violating Section 4(3);
(d) Failure to submit requested particulars under Section 7a within the prescribed period;
(e) Closure of an industry-related firm, with or without notice;
(f) Failure to renew or submit progress reports as required for establishing and operating an industry despite renewal;
(g) Violation of this Act or Rules made hereunder.
(2) Before cancellation under clauses (a), (c), (d), (e), (f), or (g), the firm must be given a reasonable opportunity to submit a clarification.
(3) If registration is canceled under clauses (a), (c), (d), (f), or (g), no other firm with the same or similar objectives shall be registered in the name of the same owner for one year.
- Penalties and Restrictions:
(1) The concerned Department may impose a fine of Rs. 5 to Rs. 50 on any person operating a private firm without registration. If repeated thrice, an additional Rs. 10 shall be added each time. Upon a fourth offense, no firm shall be registered in that person’s name thereafter.
(2) A person submitting false particulars under Section 4 may be fined Rs. 25 to Rs. 50 at the Department’s discretion.
(3) A firm failing to submit or submitting false information under Section 6 may be fined Rs. 25 to Rs. 50 at the Department’s discretion.
(4) The Government of Nepal may, by Notification, prohibit unregistered or unrenewed firms and the banks transacting with them from importing or exporting goods.
(5) An aggrieved person may appeal any penalty imposed to the Court of Appeal.
- Power to Frame Rules:
The Government of Nepal may frame Rules to implement the objectives of this Act and may prescribe fines for violations of such Rules. - Repeal:
The Private Company Act of Wednesday, 17 Chaitra 2000 is hereby repealed.
- Cancellation of Previous Licenses:
All licenses issued prior to the commencement of this Act must be renewed within the period prescribed by the Government of Nepal through a Notification in the Nepal Gazette and in accordance with Section 5. Licenses not renewed within such period shall be cancelled.
Medha Law and Partners Is a leading law firm in Nepal.