Foreign Direct Investment (FDI) Consulting in Nepal

The legal framework for FDI in Nepal

Foreign investment in Nepal is governed by the Foreign Investment and Technology Transfer Act 2075 (FITTA, 2019) and its regulations, alongside the Industrial Enterprises Act and Nepal Rastra Bank's foreign exchange directives. Investments are approved by the Department of Industry (DOI) — or by Investment Board Nepal (IBN) for large projects — and every inflow and outflow of investment capital must be recorded with Nepal Rastra Bank (NRB) to preserve your right to repatriate.

The minimum foreign investment threshold is currently NPR 20 million per investor (reduced from NPR 50 million), with the requirement removed for certain information-technology-based industries — and an automatic route now covers eligible investments, approving them through the online system without discretionary review. A negative list in FITTA reserves some sectors (such as retail trading below thresholds, certain services, and cottage industries) for domestic investors, so sector screening is the first step of any engagement.

What we handle, end to end

• Sector screening — confirming your business is open to foreign investment and identifying applicable concessions
• FDI approval application to DOI (or IBN), including the project report and prescribed forms
• Company incorporation at OCR with foreign shareholding, and PAN/VAT registration
• NRB recording of investment inflows — the step that preserves your repatriation rights
• Industry registration, and visa recommendations for investors and representatives
• Ongoing compliance — accounting, audit, tax filings, and annual reporting to DOI and NRB
• Repatriation of dividends, sale proceeds, and technology-transfer royalties through NRB approval
• Double Taxation Avoidance Agreement (DTAA) analysis for investors from treaty countries, including India, China, and others

The FDI process, step by step

1. 01Sector and structure check — is the activity open to FDI, what threshold applies, and what entity structure fits.
2. 02FDI approval — application filed with DOI/IBN (automatic route where eligible) with the project report, investor documents, and source-of-funds evidence.
3. 03Company registration — incorporation at OCR with the approved foreign shareholding, followed by PAN registration.
4. 04Capital injection and NRB recording — funds brought through banking channels and the inflow recorded with Nepal Rastra Bank.
5. 05Operational setup — industry registration, local registrations, accounting systems, and payroll established.
6. 06Annual cycle — audit, tax return, and regulator reporting maintained; dividends repatriated after tax with NRB approval.

Repatriation: the part investors care about most

FITTA guarantees repatriation of dividends, proceeds from share sales, loan repayments, and royalties — but only for investment that entered through banking channels and was properly recorded with NRB. Repatriation requires tax clearance, audited financials, and board/AGM resolutions, with dividends subject to the 5% final withholding tax before remittance.

This is why the early paperwork matters: an inflow that skipped NRB recording is an outflow you will struggle to make. We structure the entry correctly so the exit is never in question.

Why work with a local licensed firm

FDI projects fail on sequencing and follow-through more than on policy. As an audit and accounting firm, Rolacon doesn't just file your approval and disappear — we run the books, audits, and tax filings your investment will need every year after, and we're accountable to Nepal's regulators as a licensed practice. From Butwal, we serve foreign-invested companies across Nepal, including the Bhairahawa Special Economic Zone and the wider Lumbini industrial corridor.