Business Startups and Consulting
A company or a startup is an establishment of an entity to conduct a business. A business startup at the beginning phase requires consulting globally and even more in countries like Nepal. Analyzing demand and gaps in the market to identify areas to improve helps entrepreneurs in developing the right business plan. Further, this market identification is a tough yet important process for business startups in Nepal which calls for assistance from consulting organizations. This article intends to familiarize new business startups in Nepal with some mandatory procedures in requirement to follow.
Depending upon the nature/category of business, the procedures and requirements do vary. Firstly, any applicant planning to set up their own startup business need to follow the company registration process. It is an important requirement to legalize the establishment of any company. The startup business requires registration under the Companies Act, 2006 with written objectives in the memorandum of association. After its completion, the Office of Company Registration (OCR) will take the further decision on company registration.
Office of Company Registration (OCR) in Nepal
The first process is to reserve the company name at the Office of Company Registration (OCR). In Nepal, the Office of Company Registrar, Tripureshwor, Kathmandu looks after the registration process. Then, it is necessary to verify the name of the startup business and its availability to avoid contradiction with other business names in use. Within a week, the OCR will notify the applicant through an email about the approval or rejection of the company name. On approval, applicants need to prepare further documents and fill the company registration form. However, the process starts again on rejection, and the applicant needs to propose a new company name.
Upon the completion of the registration process through verification at OCR, the applicant needs to provide further mandatory documents. The applicant requires preparing articles of association and memorandum of association for their startup business. These are the major two documents that need verification and certification by the notaries. In addition, the documentation process also requires a consensus agreement if there are any. Furthermore, if ventures carry out business or transaction pursuant to prevailing law, then it requires prior approval from the respective bodies. Along with that, the owners of the company also need to provide a citizenship certificate as part of the documentation process.
Business documents submission
After the approval for startup business name and documents preparation, the next process requires uploading documents to the OCR portal. Completion of this process requires the use of the username and password of the portal which OCR provides to applicants. Also, the office of OCR needs separate hardcopy submissions of these documents. Finally, applicants complete the registration process on approval from OCR. Now, applicants need to pay registration charges. Office of OCR provides information about charges according to the capital of startup business. Applicants can pay these charges at the office of OCR. Finally, the registration process ends with the applicant receiving a certificate of company registration.
Likewise, on the receipt of the certificate of company registration, the company needs to outline its registration number, address, and the date of issue. The company must provide these details within three months after the registration of the company to OCR. Subsequently, on issuance and acceptance of share capital by the company, it requires to fulfill shareholder’s registration to OCR. Additionally, they need to update OCR with major changes in the company.
These are the mandatory requirement for the registration of business startups in Nepal. Applicants looking for business startups must take this step to legalize their business. Although, the process for registration is simple, without adequate information the overall process can be chaotic. According to a report from the Central Bureau of Statistics, economic consensus 2074(B.S), a rough estimation of 4,58,857 business operates without registration. As this is a non-compliance process, the Government of Nepal is putting efforts to bring these businesses on regulatory terms. Since a startup business without registration gives hurdles for achieving business goals, one should complete the mandatory registration process.