Kathmandu, October 24

The government has provided almost 1,500 business firms, whose licence had been cancelled automatically with the implementation of the Industrial Enterprise Act, the opportunity to renew their licence.

The new Industrial Enterprise Act that came into effect last September has a provision to automatically cancel licence of businesses that have registered themselves at various government agencies but have not started operation within the stipulated time frame.

As per the law, registered businesses need to begin operations within a certain time period depending on nature of the industry. These 1,500 small and big businesses had failed to start operations within the legal deadline.

However, Ministry of Industry (MoI) published a notice in Nepal Gazette on Monday giving such firms a chance to renew their licence or extend their deadline to begin their operation.

Shankar Aryal, director general of the Department of Industry (DoI), said that these businesses have been offered the opportunity to renew their licence as cancelling the licence of such a huge number of businesses at once will put investments worth billions at risk.

“Such firms can now either renew their firms or write an application to government to extend deadline to begin operation of their firms to preserve their licence,” said Aryal.

Meanwhile, the government has also begun the process to allow different companies that are registered but defunct to exit. Following the implementation of the new Company Act, the Office of Company Registrar (OCR) has started accepting applications from companies willing to exit as per the new law.

The new Company Act has given a chance for companies that have neither paid government taxes for the last four years nor submitted their annual audited report to the government to exit. However, such companies can exit either by paying 0.5 per cent of its paid-up capital or 0.5 per cent of the due taxes that they owe to the government, whichever is less.

As per OCR, almost 170,000 firms have been registered in the country till date, of which 40 per cent (68,000) are no longer in operation.