Third Chapter
Environment Regulations
Outline
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Foreign Investment and Technology Transfer Act 1992
Companies Act 1999
Private Firm Registration Act 1958
Industrial Enterprise Act 1992
Income Tax Act 1974
Value Added Tax Act 1996
Labor Act 1992
Partnership Act 1964
Mines and Minerals Act 1985
Patent Design and Trade Mark Act 1965
Importance of Business Legislation
 Protect business from unfair competition
 Protect consumers from unfair trade practices
 Unethical behavior
Business Legislation
 Business Legislation is concerned with:
1. Create a business environment
2. Protect interest and rights of consumer, distributors
and producers.
3. Punishment to those who violates the law
4. Regulating business environment on the basis of legal
provision.
Business Legislation
 Nepal doesn't have a long history of business legislation.
 The Company Act publicized 1936 was the first law to
regulate the management and other affairs of joint-stock
companies in Nepal.
 The Muluki Ain, which was adopted in 1963,also has
relevance for business firms.
 The laws relating to business or economic activities in Nepal
can be broadly classified as follows:
1. General Business Legislation: It includes laws relating to
the registration,organization,and management of the
business firms.
Business Legislation
2. Mineral and Natural Resources Legislation: It includes
laws relating to mines, minerals and other natural
resources.
3. Labor Legislation: It includes laws relating to wages, hours
of work, payment of bonus, dispute settlement, unionism
and labor relations.
4. Financial and Investment Legislation: It includes laws
relating
to
investment,taxation,foreign
exchange,subsidies,stock exchange and technology
transfer.
5. Social Legislation: It includes laws relating to
trademark,copyright,consumer rights, consumer-interests
and environment protection.
Finance and Investment Legislation
1. Foreign Investment and Technology Transfer
Act,1992
2. Income Tax Act,2002
3. Value Added Tax Act,1996
Foreign Investment and Technology Transfer Act 1992
 "Foreign
Investment"
means
following
investment made by a foreign investor in any
industry:
 a) Investment in share (Equity),
 b) Reinvestment of the earnings derived from
the clause (a) above,
 c) Investment made in the form of loan or loan
facilities.
Foreign Investment and Technology Transfer Act 1992
 “Technology Transfer" from foreign investor to
domestic industry under an agreement by
following ways:
 Use of any technological right, specialization,
formula, process, patent or technical know-how
of foreign origin,
 Use of any trademark of foreign ownership, and
 Acquiring any foreign technical consultancy,
management and marketing service,
Foreign Investment and Technology Transfer Act 1992
Industries not to be granted permission for Foreign Investment
1. Cottage Industries
2. Services (Business such as hair cutting, beauty parlour,
tailoring, driving training, etc.)
3. Arms and Ammunition Industries
4. Gunpowder and Explosives
5. Industries related to Radio-Active Materials
6. Real Estate Business (excluding construction industries)
7. Film Industries (National Languages and other recognized
languages of Nation)
Foreign Investment and Technology Transfer Act 1992
Industries not to be granted permission for Foreign
Investment
8. Security Printing,
9. Bank notes and Coins,
10. Retail Business
11. Travel Agency,
12. Trekking Agency,
13. Water Rafting
14. Pony Trekking,
15. Horse Riding
Foreign Investment and Technology Transfer Act 1992
16. Cigarette, Bidi, Alcohol (excluding more than 90%
exportable)
17. Internal Courier Service,
18. Atomic Energy
19. Tourist Lodging,
20. Poultry
21. Fisheries,
22. Bee Keeping,
23.Consultancy Services such as Management,
Accounting, Engineering, Legal Services.
Foreign Investment and Technology Transfer Act 1992
Features:
Technology Transfer - Technology transfer is possible even in
areas where foreign investment is not allowed.
No Nationalization – IEA 1992 has guaranteed against
nationalization of privately owned industries enterprises.
Decontrol of Prices - The government does not interfere in the
fixation or control of prices of industrial products.
Simplification in import of machinery and raw materials Industry can approach any commercial bank directly to open
Letter of Credit for the import of machinery or raw materials
needed for the industry.
Recommendation or import license from either Department
of Industries or Department of Commerce or Nepal
Rastra Bank is not necessary.
Foreign Investment and Technology Transfer Act 1992
 Minimum approval procedures - except industries that
affect security and public health, other industrial activities do
not require to obtain any license or permission for
establishment and operation.
 Transparency and clarity of facilities available - The
facilities and incentives available to various categories of
industries have been clearly spelt out in the Act itself to
avoid any ambiguity.
 Repatriation of profits, dividend, technical and managerial
fees, and certain portion of salaries of foreign experts have
been guaranteed.
 The corporate income tax for manufacturing units is fixed at
20% and is one of the lowest in the region.
Foreign Investment and Technology Transfer Act 1992
Facilities like
1. Repatriation facilities
2. Land facilities
3. Tax incentives
Foreign Investment and Technology Transfer Act 1992
At international level, Nepal has taken numerous steps to
promote foreign investment in the country. Some of the key
institutional arrangements that have been achieved so far
are listed as under:
 Nepal is a member of the World Intellectual Property
Organization (WIPO) and the Multilateral Investment
Guarantee Agency (MIGA).
 Nepal signed Bilateral Investment Treaties (BITs) with
countries such as France, Germany, Mauritius and United
Kingdom.
Foreign Investment and Technology Transfer Act 1992
 Nepal has also entered into Double Taxation
Treaties (DTTs) with 9 countries, namely, India,
Norway, China, Pakistan, Sri Lanka, Austria,
 Thailand, Mauritius, and Republic of South
Korea.
 To ensure access to the vast potential market,
Nepal is the member of WTO, SAFTA, and BIMSTEC.
Foreign Investment and Technology Transfer Act 1992
 Nepal is also a participant to the Convention on
the Settlement of Investment Disputes between
States and Nationals of Other States and a
member of the International Centre for the
Settlement of Investment Disputes (ICSID).
Value Add Tax, 1995 (2052)
Objectives:
 To increase revenue mobilization by making
effective the process of collecting revenues,
 To collect value added tax (VAT) on all transactions
including the sale, distribution, delivery, importation,
exportation of goods or services
Value Added Tax Act
 Introduced VAT system in 1997, (2054) from
November 16, 1997.
 The VAT Act replaced the existing Sales Tax,
the Contract Tax, the Hotel Tax and the
Entertainment Tax.
 It is indirect tax since tax payer indirectly
pays tax to government.
Provision
 Compulsory to all entities having annual transaction
exceeds Rs. 2 million.
 Optional for the entities having the annual transaction
less than Rs. 2 million.
 Should get Registration Number before starting the
business.
 Have to pay the collected tax 25th day of the
transacted month.
Value Added Tax Act
Other Provisions
 The single rate system of VAT is imposed. Previously the
rate was 10%,but later on it was raised to 13%
 A taxpayer has to keep an up to date account of the
transactions of the tax period.
 VAT is collected by custom office. Each registered person or
business firm has to collect tax on the selling price.
 VAT is not charged on goods and services of basic needs,
agriculture products, social welfare service, medical
services, live animal products, public travelling services and
transportation, vocational and professional services, goods
made for disabled persons, educational and cultural goods,
financial and insurance services.
Responsibility of VAT Registered Entity
 Have to maintain Purchase Book
 Have to maintain Sales Book
 Have to submit report every month
 Have to apply for the VAT return in the stipulated time
period if any
 Have to use only VAT bill
Income Tax Act, 2002 (2058)
 First Income Tax Act ( related to business, Profit and
Remuneration) enacted in 1959,
 Second Income Tax Act was enacted in 1962
 Third Income Tax Act, 1974, (amended for eight times and
existed for a period of 28 years).
 Fourth and Present Income Tax Act, 2002
Income Tax Act, 2002 (2058)
Features of Present Income Tax Act:
 All the income tax related provisions made under other
special enactment have been repealed ( removed )
 It is applicable to residents residing wherever outside
Nepal.
Income Tax Act, 2002 (2058) (ITA)
Classification of income
A) Income from Employment (an individual`s remuneration
income from an employment for an income year)
B) Income from Investment (profits and gains of a person
from conducting an investment for an income year)
C) Income from Business (profits and gains of a person
from conducting a business for an income year)
Income and gains are ascertained only after deducting
the corresponding expenses. The income from each
business and investment needs to be calculated
separately.
Income Tax Act, 2002 (2058) (ITA)
 The Act distinguishes between resident and
non-resident persons.
 A resident person is an individual whose
normal place of residence is in Nepal and who
is present at any time of the year, or who is
present in Nepal for 183 days or more, or who
is an employee of Government of Nepal
posted abroad at any time during the year.
Income Tax Act, 2002 (2058) (ITA)
 For every person the tax is imposed and calculated
for an income year.
 The income year corresponds with Governments
Fiscal Year, i.e. the period start from Shrawan to
Ashad of the following year (mid-July to mid-July).
Income Tax Act, 2002 (2058) (ITA)
Tax Rates
The taxable income of a resident individual for an
income-year 2067/68 :
Up to Rs.160,000 - 1%
From Rs.160,000 - upto Rs.260,000- @ 15 %
plus Rs. 1600
Above Rs. 260,000 - @ 25% plus Rs.16600.
Income Tax Act, 2002 (2058) (ITA)
Tax Rates
The taxable income of a resident individual for an incomeyear 2067/68 :
The taxable income of a couple, if they chose to be treated
as a couple will be taxed at the following rates;
Up to Rs.200,000 - 1%
From Rs.200,000 - upto Rs.300,000- @ 15 % plus Rs.
2000
Above Rs. 300,000 - @ 25% plus Rs.17000.
Women : 10% tax excused
Income Tax Act, 2002 (2058) (ITA)
 Any individual is entitled to deduct the following
amount from taxable amount, if he is having
investment insurance policy :
 Rs. 20,000 amount or the actual premium paid,
which ever is less.
 For the purposes of the Act, net gains from the
disposal of non-business chargeable assets will be
taxed at the rate of 10 percent.
Income Tax Act, 2002 (2058) (ITA)
 The probable tax for individuals conducting small
businesses (who have a turnover of Rs.2 million or an
income of Rs.200,000) in the
 Metropolitan or Sub-Metropolitans- Rs. 5000,
 Municipalities – 2500
 Anywhere else in Nepal Rs.1,500 respectively.
 The taxable income of a non-resident individual is taxed at
the rate of 25 percent.
 The taxable income of an entity will be taxed at the rate of
25 percent unless prescribed otherwise.
Income Tax Act, 2002 (2058) (ITA)
Tax Accounting
 For tax purposes, an individual is required to maintain
his accounts on a cash basis in calculating the
individual's income from an employment or investment
 A company is required to maintain its accounts on an
accrual basis within the basic framework of generally
accepted
accounting
principle.
Income Tax Act, 2002 (2058) (ITA)
Implementing Agency
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District Level : Inland Revenue Office (IRO)
Department Level : Inland Revenue Department (IRD)
Ministry Level : Ministry of Finance
Dispute Settlement by IRD, Revenue Tribunal and court
General Business legislation
1.
2.
3.
4.
Private Firms Registration Act,1958
Partnership Act,1964
Company Act,2006
Industrial Enterprise Act,1992
Private Firm
Registration Act,
1958 (2014)
Features:
 Firm to be registered under Department of
Commerce private firm or under Office of Cottage
and Small Industries.
 The license is issued for five years and should be
renewed after that period.
 Recommendation letter is required from the
Chambers of Commerce or District branch of
FNCCI to register the Private Firm.
 Trading business are registered under this act.
 It is easy to register Private Firm in DOC since
there is no need of AOA or MOA as compare to
single promoter private company to be register in
CRO.
Partnership
Act, 1964
(2021)
Feature
 If two or more person want to initiate business,
partnership firm can be registered.
 Partnership Deed ( an agreement among the
Partners mentioning the each and every things
is required to registered the firm.
 The partnership deed has mentioned following
things: Equity ratio, profit sharing ratio, entrants
of new partner and exit of the existing partner,
settlement the disputes, dissolution of firm, etc.
Feature
 Firm can be registered under Department of
Commerce (in Kathmandu valley) and Office of
the Cottage and Small Industries ( in outside the
valley ) with the recommendation letter of
Chambers of Commerce.
 Any time the firm can be dissolve as per the
partners’ agreement.
 Tax law is applicable and the firm should be
renewed each five years where the firm has
been registered.
 It is easy to establish and dissolve comparing to
the establishing of the company under Company
Act.
 Every partner liable jointly personally with all the
other partners for all the acts of the firm done
while he/she was a partner.
 If a firm carries on any business without
registration in contravention of Section 5, every
partner shall be liable to a fine not exceeding
Fifty rupees;
Company Act, 2063 (2006)
 It contains 21 chapters and 188 Sections
 Promulgated on Kartik 24, 2063
 Objective of the Act:
 To make the companies in order to bring about dynamism
in the economic development of the country by promoting
investment in the industry, trade and business sectors
through economic liberalization and make the incorporation,
operation and administration of companies much easier,
simpler and more transparent;
Incorporation of Company
1. Private Ltd. Company . : No. of shareholders
minimum 1 to maximum 50.
2. Public Ltd. Company : No. of shareholders
minimum 7 and no limit to maximum no.
3. Memorandum of Association (MOA) and
Articles of Association (AOA) is required to
register the co.
4. Registration of Co. – In the Office of the
Company Register, Department of Commerce.
 Office of Company Registrar (CRO) has sole authority of
registration, administration, supervision, recording and
regulating the companies.
 Pvt. Company can be converted into Ltd. Co. and vice
versa.
 Company Secretary is compulsory for Public Ltd. Company,
with the paid –up capital of ten million rupees or more.
 Financial Statements and other decision made of General
Assembly should be submit to the CRO by the company
each year.
 Liabilities is Limited to the shareholders up to their amount
of shares.
Documents Required to establish Co.
a)
The memorandum of association of the proposed
company,
(b) The articles of association of the proposed
company,
(c) In the case of a public company, a copy of the
agreement, if any, entered into between the
promoters prior to the incorporation of the
company,
(d) In the case of a private company, a copy of the
consensus agreement, if any, entered into ,
(e) Where prior approval or license has to be
obtained
(e) Where prior approval or license has to be obtained
from anybody under the prevailing law prior to the
registration of a company carrying on any particular
type of business or transaction pursuant to the
prevailing law, such approval or license,
(f) Where the promoter is a Nepalese citizen, a certified
copy of the citizenship certificate and where a
corporate body is a promoter, a certificate of
registration of incorporation, decision of the Board of
directors, regulating The incorporation of the
company
and
major
documents
regarding
Incorporation.
Where the promoter is a foreign person or
company or body, permission obtained under
the prevailing law to make investment or carry
on business or transaction in Nepal,
(h) Where the promoters is a foreign person, a
document proving the country of his
citizenship,
(i) Where the promoter is a foreign company or
body, a certified copy of the incorporation of
such company or body and major documents
relating to such incorporation.
(g)
The Memorandum of Association of
a company shall state the following matters:
(a) The name of company,
(b) The address of the registered office of the
company,
(c) The objectives of the company,
(d) The acts to be carried out to accomplish the
objectives of the company,
(e) The figure of the authorized capital of the
company and the figure of the share capital
to be issued by the company for time being
and the figure of undertaken to be paid by the
promoter of the company,
(f) Types of shares of the company, the rights
and powers inherent in such shares, value of
each share and number of shares of different
types,
(g) Restrictions, if any, in the purchase or
transfer of shares,
(h) Number of shares which the promoters
have undertaken to subscribe for the time
being,
(i) Terms of payments of share amounts,
(j) Statements that the liability of shareholders
shall be limited,
(k) The maximum number of shareholders in
case of a private company,
(l) Other necessary matters.
(c) Number of directors, provision of alternate
director, if any, and tenure of directors,
(d) Provisions relating to the minutes of
decisions of the general meeting and the
board of directors, and duplicate copies and
inspection thereof,
(e) If a person has to subscribe shares to
become a director of a company, minimum
number of shares,
(f) In the case of a public company,
qualifications and number of independent
director,
(g) Where any professional persons, other than
shareholders, are to be appointed as directors,
provisions relating to the number, tenure, qualifications
and procedures of appointment of such persons,
(h) Powers and duties of the board of directors and the
managing director,
(i) Authority of directors and delegation of authority,
(j) Quorum for a meeting of the board of directors, notice
of meeting and proceedings of meeting,
(k) Lien on shares,
(l) Different classes of shares and the rights, powers and
restrictions attached to such shares,
(m) Provisions relating to calls on shares and forfeiture
of shares,
(n) Provisions relating to the transfer of shares,
(o) Matters on alteration in share capital,
(p) Matters on buying back of shares by the
company, if the company is to buy back its
shares,
(q) Appointment of a company secretary,
(r) Provisions relating to remuneration,
allowances and facilities of directors,
(s) Use of the company’s seal in its
transactions, if it is to be so used,
(t)
Accounts, books of accounts and audit of the
company,
(u) Provisions on powers to raise loans or
debentures,
(v) merger of the company,
(w) Such matters, if any, as required by the
prevailing law to be mentioned in the articles
of association of a company carrying on any
specific business,
(x) Such other necessary matters as required to
be mentioned in the articles of association.
Industrial Enterprises Act,
1992 (2049)
Promulgated on 12 Nov. 1992 (049/07/27)
First Amendment on
22 Aug. 1997 (2054/05/06)
Industrial Enterprises Act, 1992 (2049)
Objectives
 To make arrangements for fostering industrial
enterprises in a competitive manner through
the increment in the productivity,
 To make the environment of industrial
investment more congenial, straightforward
and encouraging.
Industrial Enterprises Act, 1992 (2049)
Types of Industries:
a) Manufacturing Industries: Industries which produce
goods by utilizing or processing raw materials, semiprocessed materials, by-products or waste products
or any other goods.
b) Energy-Based Industries: Industries generating energy
from water resources, wind, solar, coal, natural oil, gas,
bio-gas or any other sources.
c) Agro and Forest – Based Industries: silk production,
horticulture and fruit processing, animal husbandry, dairy
industry, etc.
Industrial Enterprises Act, 1992 (2049)
d) Mineral Industries: Mineral excavation or processing
thereof.
e) Tourism Industries: Tourist lodging, motel, hotel,
restaurant, resort, travel agency, skiing, gliding, water
rafting, cable car complex, pony-trekking, trekking, hot air
ballooning, parasailing, golf-course, polo, horse-riding, etc.
f) Service
Industries:
Workshop,
printing
consultancy service, public transportation etc.
press,
g) Construction Industries: Road, bridge, ropeway, railway,
trolley bus, tunnel, flying bridge and industrial, commercial
and residential complex construction and operation.
Industrial Enterprise Act,1992 (2049)
 This act classifies industries into the following four types
according to investment and the scale of their operations.
1. A cottage industry is an enterprise which utilizes specific
skills or local raw materials and resources, and which is
labor-intensive and is related with national tradition, art and
culture.
2. A small industry is as an enterprise in which fixed assets
do not exceed Rs.30 million.
3. A medium industry is an enterprise in which fixed assets
investment exceeds Rs.30 million but does not exceed
Rs.100 million.
4. A large industry is an enterprise in which investment in
fixed assets exceeds Rs.100 million.
Cottage Industries:
 The traditional industries utilizing specific skill or local
raw materials and resources, and labor intensive and
related with national tradition, art and culture
(mentioned in Annex 1)
Provisions of Act
 Industrial Promotion Board – Policy level
 One Window Committee – Implementation level
Constitution of Industrial Promotion Board ( as per clause 12)
a) The Minister or State Minister for Industries - Chairman
b) The Assistant Minister for Industries - Member
c) Member (looking after industries), National Planning Commission Member
d) The Governor, Nepal Rastra Bank - Member
e) The Secretary, Ministry of Industry - Member
f) The Secretary, Ministry of Finance - Member
g) The Secretary, Ministry of Commerce - Member
h) The Secretary, Ministry of Tourism - Member
i) The Director General, Department of Cottage and Small Industries Member
j) Representative, Federation of Nepalese Chambers of Commerce and
Industry - Member
k) Two persons, nominated by Nepal Government, either from among the
industry, commerce and tourism sector organizations or from among
the persons of high distinction in the same field. - Member
l) The Director General, Department of Industries - Member Secretary
Functions, Duties and Powers of the Board:
a)To render necessary cooperation in formulating
and implementing policies, laws and regulations
b) To give guidelines in attaining the objectives of
liberal, open and competitive economic policies
c) To maintain coordination between the policy level
and the implementation level of the industrial
policy.
g) To give directives to the concerned body
Constitution of the One-Window Committee:
1) Government shall, for the purpose of making available the facilities
and concessions to be enjoyed by any industry under this Act in
time from a single place, constitute a One-Window Committee
consisting of the following:
a) The Director-General, Department of Industries-Coordinator
b)The Director-General, Department of Customs-Members
c) The Director-General, Department of Excise Duty- Member
d) The Director-General, Tax Department-Member
e) The Director-General, Sales Tax Department
Member
f) The Director-General, Department of Commerce -Member
g) The Chief Controller, Nepal Rastra Bank - Member
h) Representative, Federation of Nepalese Chambers of Commerce
and Industry – Member
i) one expert in the field of industry and commerce as designated by
Government of Nepal or one representative from the
Federation Member
One-Window Committee:
The functions, duties and powers :
a) To make necessary decisions for making available
the facilities and concessions to be enjoyed by any
industry under this Act.
b) To perform such functions as may be delegated by the
Board under its functions, duties and powers.
c) To make recommendations
to make available
infrastructural services such as electricity, water, means
of telecommunications, land, road, and so on required
for the industries.
Mines and Natural Resources
Legislation
 Mines and Minerals Act1985 (2042)
 Nepal Petroleum Act,1983
Mines and
Minerals
Act1985 (2042)
Mines and Minerals Act1985 (2042)
 Objective of the act is to promote the existing mine
and minerals
 Mineral products means an inorganic product
excluding gas and petroleum exist Mineral products
over or under the earth and made of physical or
chemicals combination.
 All mineral products found inside the Nepal are the
property of Government of Nepal.
 These are classified in two category – Metal and
Non Metal
 Three Categories : Most Valuable, Valuable and not
valuable
 Right to extraction of mineral product is with
government. Permission can be given to the
private company as per their qualification and
previous experience.
 License shall be issued for a year and can
be renewed. Government can cancel the
license if found the licensee doesn't work as
per the law.
Responsibility and Rights of License holder:
 To provide report to the concern authority regularly
 To be aware on protection of environment
 To keep communication set and weapons as per
requirements
 To enjoy the government facilities as per the laws
 To pay the local taxes and other taxes
 To influence the private land for time being
 To bring and use of explosive
Nepal Petroleum Act,1983
 This governs the searching and development of petroleum in
Nepal.
 The Government, under this Act owns all petroleum
resources existing in the country.
 It has an exclusive right to carry out petroleum exploration,
development and production either by itself or through
contractors.
 Searching and exploitation of gas deposits also fall under the
fold of this act.
 As this sector is still under-developed and requires huge
investment, foreign investment is encouraged by the Act.
 This Act is also administered through the Department of
Mines and Geology.
Labor Act, 1992 (2049)
Objective
To make provision of the rights,
interests,
facilities
and
safety
of
workers and employees working in
establishments belonging to different
fields.
Labor Act, 1992 (2049)
 Labor Act 1992 (2049) replaced the Nepal Factory and
Factory workers Act, 1959.
 The Act emphasizes on job security, rights of remuneration
after work, prohibition of child labor, freedom to be a
member of trade union, minimum wages, health, safety and
welfares, code of conduct, workers' participation in
management and dispute settlement.
 Ministry of Labor and Transportation is responsible to
implement and monitor the act.
Labor Act, 1992 (2049)
Provisions:
 No worker or employee shall be deployed in work for more
than eight hours per day or 48 hours per week with one day
weekly holiday for every week.
 No agreement may be entered into between the manager
and workers or employees in a way to make the minimum
remuneration, dearness allowances and facilities lesser than
those fixed by GON.
 Change in the ownership of the Enterprise shall not be
affected on the terms and conditions of service of the
workers and employees.
Labor Act, 1992 (2049)
Provisions:
 One welfare Officer shall have to be appointed in
Enterprise where 250 or more workers of employees
are engaged and one additional Assistant Welfare
Officer shall have to be appointed where there are
more than 1000 workers or employee
 The service of any permanent worker or employee
may not be terminated without following the
procedures prescribed by this Labor Act or the
Regulations or Bylaws made under this Act.
Labor Act, 1992 (2049)
Provisions
 The permanent worker of employee shall have to be paid
with at least twenty five percent of his remuneration as
retaining allowance for the period of closure of a seasonal
Enterprise during off-season.
 Proper safety provision should be made in working place to
prevent from the probable accidents, harm and injury to the
employees.
 Where fifty or more female workers and employees are
engaged in the work, the Proprietor of the Enterprise shall
have to make provisions of a healthy room for the use of
children of such female workers and employees.
Labor Act, 1992 (2049)
Provisions
 The Enterprise shall have to establish a Welfare
Fund, as prescribed for the welfare and benefit of
the workers or employees.
 In case any worker or employee of the Enterprise is
physically wounded or seriously hurt or dies in
course of his work, the compensation shall be paid
to him or to his family, as prescribed.
Labor Act, 1992 (2049)
 The Proprietor shall have to constitute a Labor
Relation Committee in each Enterprise in order
to create amicable atmosphere between the
workers or employees and the management
and to develop healthy labor or industrial
relation on the basis of mutual participation and
coordination.
Labor Act, 1992 (2049)
 The act shall not be applicable if there are less than
10 employees,
 Regulate by Labour office, Ministry of Labour and
Transportation
 Provision of Labour Court
 ILO protocols are applicable
The Patent, Design and
Trade Mark Act, 2022
(1965)
Patent
 It is new invention of product or service or formula or
structure, method or theory that is useful for human life.
 It should be registered by a person or entity in Department
of Industry with details of all documents to be prove that
the patent is belongs to him.
 It can be registered after due investigation and prove that it
is new one and not registered yet by another person or
entity.
 It is registered for 7 years and can be renewed.
Patent




Can be transfer with permission of patentee.
Content of Application:
Name, address and occupation of inventor
Manner and nature of right acquired, if applicant is not the
inventor.
 Manner of producing, using or conducting the patent,
 Principle or formula on which patent is based.
Non registration of Patent
 Already registered in another person’s name.
 Not invented by the applicant or the right to patent not
received.
 Causes adverse effects on health, good conduct or
morality or is harmful to national interest.
 Disobey existing laws of Nepal.
Design
 Design means any feature, pattern or shape of a
matter prepared and produced in any manner.
 One can register his unique design for five years and
can be renewed for the same time again.
 No one can use the Foreign patent, design and
trademark without register in Nepal
 It can be used by jointly if owner of the TM, P and D
is agreed.
Design
 No allow to register TM, P and D of Nepalese product or
services in foreign countries without registering in Nepal.
Non Registration:
 Already registered in another person’s name
 Likely to cause damage to the reputation of an individual
or an institution.
Breaching of law is not excused.
Trade mark
 Trade mark is a any symbol, sign, picture, word
or the combination of all of that which makes
differ and significant from others product,
services and goods.
 A registered brand is trade mark.
 If not use until a year after registration by the
organization, it may be cancelled.
Schedule-3
Application Registration and Renewal Fees In Respect to
patents, Designs and Trade- marks
S.no Details of fees
1
Patent
Application of Registration Rs 2000/fees
Design
Rs 1000/-
for the patents, Designs and
Trade-marks
2
Application Amendment fee Rs 500/-
Rs 500/-
3
Registration fee
Rs 10000.–
Rs 7000/-
4
Transfer fee
Rs 5000/-
Rs 3000/-
Consumerism
 Action or practice of consuming. Economic policies
placing emphasis on consumption.
 Organized movement of consumer.
 It focuses on protect consumers from unfair practice of
producer and marketers and enhance right of
consumers in relation to producer and marketers.
 In Nepal, some of the law regarding consumer
protection are:
1.
2.
3.
4.
Food Act 1966,
Consumer Protection Act 1998
Nepal Standardization Act 1980
Black Marketing and other Social crime Punishment Act
1979
Questions
1. How FITTA, 1992 provides best opportunity to the
foreign investors in Nepal? Do you think that the
act is enough to create conducive environment for
the foreign investor. Why? Why not?
2. Highlight the major influences of the Labour Act
and Income Tax Act in the business? In which
business it is regarded as a least influential factor?
Most influential factor?
3. " There is always debate on VAT Acts among the
both consumers and traders." Suggest to the IRD
for the effective implementation of VAT Act.
Questions
1. "Knowledge of legal environment is essential for
businessman even though they can hire legal experts."
Comment.
2. Critically examine the role of
Nepal.
regulatory
authorities of