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Industry Registration Process in Nepal (2025)

1. Introduction

The Industrial Enterprises Act, 2076 (2020) governs the procedure for industry registration in Nepal. This legislation aims to create a simplified, transparent, and efficient framework for managing and regulating the country’s industrial sector. Industry registration can be carried out through either provincial or federal government authorities, depending on the nature and scope of the enterprise.

2. Classification of Industries

Under the Industrial Enterprises Act, industries are categorized based on criteria such as capital investment, assets, production capacity, and business objectives. These classifications are further broken down based on the type of goods and services being produced.

2.1 Classification Based on Capital and Asset Value

a. Micro Industry
Key features of micro industries include:

1. Fixed capital investment not exceeding NPR 2 million, excluding land and building costs.
2. Employment of a maximum of nine workers, including the proprietor.
3. Annual business transactions of less than NPR 10 million.
4. Utilization of electric energy, fuel, or other types of engines with a maximum capacity of 20 KW.
5. May operate without prior approval from the Government of Nepal.

b. Cottage Industry
Cottage industries are defined by the following attributes:

1. Labor-intensive, relying on specific skills, local raw materials, and traditional technology, art, and culture.
2. Use of machinery or equipment with a total energy consumption of up to 50 KW.
3. These industries are listed in Schedule 2 of the Act and are automatically eligible for registration as cottage industries.

Schedule 2 includes industries such as:

1. Handloom, pedal-loom, semi-automatic loom, dyeing, printing, wrapping, traditional tailoring and knitting
2. Hand-knitted wool/silk blankets (Radi, Pakhi), carpets, pashmina, handmade garments and paper
3. Traditional crafts and sculpting
4. Handmade metal utensils (copper, brass, German silver, etc.) and traditional household tools (Khukuri, sickles, Kodalo, etc.)
5. Handmade ornaments (gold/silver), with or without precious/semi-precious stones
6. Cutting of precious/semi-precious stones and handmade leather items
7. Industries using natural fibers like jute, sabia grass, choya, babiyo, cotton, allo
8. Stone carving
9. Traditional artworks like Paubha, Thangka, and cultural masks and dolls

c. Small Industry

• Defined as an industry with a fixed capital not exceeding NPR 150 million.

d. Medium Industry

• Industries having a fixed capital between NPR 150 million and NPR 500 million fall under this category.

e. Large Industry

• Industries with fixed capital exceeding NPR 500 million are classified as large-scale industries.

2.2 Classification Based on the Nature of Goods and Services Produced

The industries classified by capital, assets, and objectives are further sub-categorized based on the type of goods and services they provide. The categories include:

a. Energy-Based Industry

Features: These industries are engaged in activities related to the generation and distribution of energy and power.

As per Schedule-3, this includes:

1. Industries generating energy from sources like water (hydro), wind, solar, coal, petroleum, gas, biomass, and others.
2. Production of machines or equipment for energy generation.
3. Electricity transmission infrastructure.
4. Electricity distribution systems.
5. Bio-gas energy projects.
6. Co-production of electricity by sugar industries.
7. Feasibility studies for energy generation potential.

b. Manufacturing Industry

Features: These are industries involved in the production of goods through the use or processing of raw materials, secondary materials, or semi-processed inputs.

c. Agriculture and Forest-Based Industry

Features: Industries that use agricultural or forest products as raw materials or are otherwise directly related to the agriculture or forestry sectors.

As per Schedule-4, this includes:

1. Fruit farming and fruit processing
2. Production, processing, and storage of food items
3. Animal husbandry, including poultry (e.g., ostrich), breeding, and meat production
4. Milk production and dairy processing
5. Fish farming, fry production, and packaging
6. Feed production using agro-based raw materials

d. Mining Industry

Features: Industries engaged in the excavation or processing of minerals, including metals and other natural resources.

e. Infrastructure Industry

Features: Industries involved in the construction and operation of physical infrastructure.

As per Schedule-5, this includes:

1. Roads, bridges, tunnels
2. Ropeways, railways, tramways, monorails, sliding cars
3. Airports and runways
4. Industrial infrastructure complexes
5. Convention and assembly centers
6. Water supply and irrigation systems
7. Stadiums and sports complexes
8. Vehicle parking structures
9. Export processing zones, special economic zones, cargo complexes
10. Wastewater treatment facilities
11. Telecommunication infrastructure (towers, optical fiber, satellite systems)
12. Residential and housing projects
13. Film cities, studios
14. Infrastructure for power plants and energy transmission systems

f. Tourism Industry

Features: Industries offering tourism-related services, as listed in Schedule-6.

Includes:

1. Hotels, motels, resorts, restaurants, bars
2. Travel agencies, tour operators, casinos, spas, massage centers
3. Adventure tourism (trekking, skiing, rafting, hot air balloon, bungee jumping, skydiving, etc.)
4. Cable car operation industries
5. Golf courses, pony trekking, cycling tourism
6. Eco-tourism, rural tourism, homestay programs
7. Cultural, religious, and sports tourism
8. Amusement and water parks
9. Wildlife reserves
10. Museums

g. Information Technology, Communication & Information Dissemination-Based Industry

These industries are outlined in Schedule-7 and divided into three parts: 

Part A: Information Technology-Based Industries

1. Technology/IT/Biotech Parks
2. Software development and computer services
3. Data processing, cyber cafés, digital mapping
4. BPO, KPO services
5. Data centers, cloud computing, data mining
6. Digital signature certification
7. Web design, hosting, and classified advertising services

Part B: IT-Enabled Services and Communication Technology

1. Internet Service Providers (ISP)
2. Mobile, telephone, satellite communication services
3. Teleport services, satellite operation and broadcasting
4. Broadband, telecom towers, satellite and optical networks
5. Social media, video conferencing, messaging services

Part C: Dissemination Technology-Based Industries

1. FM and digital radio services
2. Satellite, cable, digital TV, IPTV, DTH services
3. Recording and broadcasting studios
4. Print media, audio-visual production, advertising production
5. Film and documentary production

h. Service Industry

Features: Industries offering services across various professional and technical sectors as listed in Schedule-8.

Includes:

1. Mechanical workshops
2. Printing services
3. Professional services like legal, audit, management, education, engineering, R&D, consultancy
4. Joining and welding businesses
5. Exhibition and event management
6. Cultural and recreational enterprises
7. Construction services
8. Public transport operations
9. Photography services

3. Industry Registration Eligibility

Any individual, firm, or company intending to establish an industry in Nepal may apply to the Department of Industry (DOI) by submitting the prescribed application form along with the necessary documents.

1. Industries falling under Section 1 of the Industrial Enterprises Act, including those involving foreign investment, federal-level matters, atomic or uranium-based energy, educational consultancy, diplomatic sectors, or industries operating in two or more provinces, must register through federal authorities.
2. Industries under the purview of provincial governments should apply to the respective provincial registration bodies.

4. Checklist of Required Documents

The following documents are required for the industry registration process:

1. Application form as per Schedule 1
2. Project proposal/details according to Schedule 2
3. Copy of citizenship certificate (for Nepali nationals) or passport (for foreigners)
4. Notarized copy of Company Registration Certificate, Memorandum of Association, and Articles of Association (for companies)
5. Map of the proposed industrial site
6. Original Power of Attorney and Identification Certificate
7. Original FDI approval letter (for industries with foreign investment)
8. Partnership agreement (if applicable)
9. Recommendation letter from local authorities
10. Approved environmental documents (Initial Environmental Examination - IEE or Environmental Impact Assessment - EIA, as required)
11. Application must be submitted through the official online platform

5. Industry Registration Process in Nepal

Step-by-step Registration Procedure:

1. Preparation of the checklist and Application Form
2. Online submission of the completed application form along with digitally signed and verified documents
3. Submission of the fee voucher after registration fees payment
4. Examination and verification of submitted documents by the Department of Industry (DOI)
5. Issuance of Industry Registration Certificate within five (5) working days upon receipt of complete documents

• If any information or document is missing, DOI will notify the applicant to furnish the missing details within ninety (90) days of receiving the application.
• Failure to comply within the given time may lead to rejection, with written reasons provided by the authority within five (5) days after the decision.
• If dissatisfied, the applicant may file an appeal to the relevant Ministry (federal or provincial) within thirty (30) days of the decision.

The Industry Registration Certificate includes:

1. Date of issuance
2. Timeline for starting commercial operations
3. Conditions and compliance requirements
4. Any additional terms specified by the registration authority

Note: For micro industries, applications may be submitted within one year of beginning operations.

After starting commercial production or transactions, the industry must submit operational details to the registration authority within six months from the end of each fiscal year.

6. Special Provisions

Industries Requiring Special Approval

Certain industries, as listed in Schedule 1 of the Act, require prior permission from the Industrial and Investment Promotion Board (IIPB) before registration.

Application Procedure:

•  The application must be submitted to the Board through the relevant registration authority, accompanied by the necessary information.

Industries That Require Prior Permission:

1. Production of arms, ammunition, gunpowder, explosives
2. Security printing (banknotes, coins)
3. Tobacco-related products (cigarettes, bidis, cigars, chewing tobacco, e-cigarettes)
4. Alcohol production, including microbreweries, beer, liquor, and related products
5. Mining and processing of stone, sand, ballast
6. Radio communication equipment manufacturing
7. Excavation of precious minerals and petroleum
8. LPG refilling plants
9. Drone-based industries (manufacturing or services)
10. Other industries as prescribed under existing laws

Once registered, such industries must report their operation and commercial activity within 30 days of commencement.

1. If operations are not started within that timeframe:
2. The industry must notify the authority at least 30 days before the expiry of the period stated in the registration certificate, or
3. Within six months after that expiry period, along with the payment of a delay fee.

Additional provisions:

1. Inspection body will be established to monitor industrial operations
2. Penalties apply in case of non-compliance with the registration process

7. Post-Registration Compliance

After registration:

1. The industry must report its operational status within thirty (30) days of commencing commercial production or service.
2. If the operation is not started within the allowed time, a formal notice must be submitted to the industry registration body:
1. At least 30 days before the specified date in the certificate, or
2. Within 6 months after the expiration of the specified timeframe, along with the delay fee.

The government will also:

1. Establish an inspection mechanism to ensure industries operate in compliance
2. Enforce penalties for failure to comply with registration or operational requirements