Nepal’s strategic location between India and China makes it a growing hub for international trade. Whether you’re importing raw materials or exporting finished goods, compliance with Nepal’s import/export laws is essential. From registration to customs clearance, businesses must follow specific legal procedures to avoid penalties and ensure smooth operations.

This guide explains the legal requirements for import/export businesses in Nepal, including licenses, documentation, compliance rules, and FAQs for 2025.

Legal Framework for Import/Export in Nepal

Import and export activities are regulated by:

• Foreign Trade Policy of Nepal

• Customs Act 2064 (2007)

• Export-Import (EXIM) Code Regulations

• Foreign Exchange Regulation Act

• Department of Customs & Department of Industry Guidelines

These laws ensure transparency, fair trade, and compliance with international standards.

Key Legal Requirements for Import/Export Businesses

1. Company Registration

• Register your business at the Office of Company Registrar (OCR).

• Obtain a PAN (Permanent Account Number) from the Inland Revenue Department.

2. EXIM Code Registration

• Mandatory for all import/export businesses.

• Issued by the Department of Customs.

• Requires PAN, company registration certificate, tax clearance, and bank guarantee.

3. Customs Clearance

• Submit import/export declaration forms.

• Provide invoices, packing lists, bills of lading, and certificates of origin.

• Pay applicable customs duties and VAT.

4. Tax Compliance

• VAT registration required for businesses with turnover above NPR 5 million.

• Income tax filing annually.

• Customs duties vary depending on HS codes.

5. Foreign Exchange Approval

• Nepal Rastra Bank regulates foreign currency transactions.

• Importers/exporters must use authorized banks for payments.

6. Sector-Specific Licenses

• Pharmaceuticals, food, and electronics require additional permits.

• Export of natural resources (timber, herbs) requires government approval.

Common Duties and Taxes in Import/Export

Compliance Risks

• Importing restricted goods without permits.

• Under-invoicing or misdeclaration at customs.

• Failure to renew EXIM Code annually.

• Non-payment of VAT or income tax.

Penalties include fines, confiscation of goods, and blacklisting.

Practical Tips for Import/Export Businesses

• Register your company and obtain EXIM Code before trading.

• Maintain proper invoices and customs documents.

• Use authorized banks for foreign transactions.

• Stay updated with customs tariff schedules.

• Consult trade lawyers for sector-specific compliance.

Final Thoughts

The import/export business legal requirements in Nepal are designed to promote fair trade and protect national interests. By registering properly, obtaining an EXIM Code, and complying with customs and tax laws, businesses can expand globally with confidence. In 2025, digital portals and streamlined procedures make compliance easier than ever.