Closure of Company with Foreign Investor (विदेशी लगानीकर्ता भएको कम्पनीको खारेजी)

The voluntary closure of a company having foreign investor allows the investor to return the investment to his/her country. It is the formal legal exit from Nepali market regulated by OCR, DOI and NRB. It is governed by the Companies Act, 2063 and the Foreign Investment and Technology Transfer Act (FITTA), 2075. A formal liquidation is required to settle local liabilities and secure mandatory approvals for the repatriation of investment and surplus assets

₨ 1,000.00

Categories Business Closure, Company Closure

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Introduction: Closure of FDI Company

In the context of Foreign Direct Investment (FDI), company closure is not merely a cessation of business but a cross-border regulatory exit. Under FITTA, 2075, the government monitors withdrawal of foreign capital to ensure that all local creditors and tax obligations are satisfied before capital leaves the country. This process requires synchronizing the dissolution at the Office of the Company Registrar (OCR) with final clearances from the Department of Industry (DOI) and Nepal Rastra Bank (NRB).

Legal Requirements: Compliance under Companies Act & FITTA

According to Section 126 of the Companies Act, 2063, the closure must begin with a Special Resolution passed by a 75% majority of shareholders, along with declaration of solvency by the directors. A licensed Liquidator must be appointed to realize assets and settle liabilities in a transparent manner. Formal closure of the company requires approval from Department of Industry (DOI) verifying that the foreign investor has fulfilled all terms of their initial investment approval and that no labor or industrial disputes remain unresolved.

If a company is abandoned without formal liquidation, the Nepal Rastra Bank (NRB) will strictly refuse any application for the Repatriation of Funds. This means the foreign investor will be unable to legally transfer their remaining capital, share sale proceeds, or dividends out of Nepal. Furthermore, the directors (both local and foreign) may face personal liability and be blacklisted by the Credit Information Bureau (CIB), preventing them from participating in future investments or obtaining credit within the country.

Process: Closure of Company with FDI

Special Resolution & DOI Notification

Pass a Special Resolution for voluntary liquidation and formally notify the Department of Industry (DOI) of the intent to cease operations and withdraw investment.

Liquidation & Creditor Settlement

Appoint a liquidator and publish a 30-day notice in a national daily newspaper. The liquidator must prioritize the payment of employee dues, local vendors, and government taxes.

Final Tax Audit & Repatriation Approval

Obtain a final Tax Clearance Certificate from the IRD. Apply to the DOI/IBN for a recommendation letter for repatriation, which is essential for the final exit of capital.

OCR Dissolution & NRB Final Exit

Submit the liquidation report to the OCR for the Certificate of Dissolution. Present this certificate along with DOI approval to Nepal Rastra Bank (NRB) to obtain final permission for the outward remittance of funds.

Ready to manage your FDI Exit Strategy?

Exiting the Nepalese market with foreign capital requires expert coordination between the OCR, DOI, and NRB to ensure fund repatriation is not blocked by procedural errors. Present Consultants Private Limited specializes in FDI-linked liquidations, providing a seamless bridge between local compliance and international financial requirements.
Contact us today to ensure your foreign investment is repatriated legally and efficiently.