INGO in Nepal: INGO Registration Process in Nepal

Law Governing INGOs in Nepal/Legal Regime Governing INGOs in Nepal/INGO Operation in Nepal/INGO registration in Nepal

The primary laws governing INGOs in Nepal are the Social Welfare Act of 1992 and the Social Welfare Council Rules of 1992. These legislations regulate and oversee INGO operations within the country’s boundaries, providing a legal framework for establishment, registration, and functioning. INGOs must seek approval from the Social Welfare Council (SWC) and enter into two agreements with them: The General Agreement, which outlines the overall framework of their presence, and The Project Agreement, which specifies project details. INGOs must collaborate with local NGOs to implement their objectives in Nepal. Compliance with these laws ensures transparency, accountability, and effective project implementation for the benefit of Nepalese society.

The main regulating body responsible for overseeing INGOs in Nepal is the Social Welfare Council (SWC). To operate an INGO in Nepal, it is mandatory to obtain approval from the SWC. Prior to conducting any development, social, or welfare activities in Nepal, the INGO must execute both a General Agreement (GA) and a Project Agreement (PA) with the SWC.

The application for the PA should be submitted within three months from the date of signing the General Agreement. In case the submission is not made within the given time, the SWC may grant an additional three months for submission, but a fine will be charged for the delay. It is possible for INGOs to have more than one PA under a single GA. Moreover, INGOs are required to donate at least USD 2,00,000 annually, and the source of funding must originate from outside of Nepal.

Legal Requirements for INGO Registration in Nepal

INGOs wishing to operate in Nepal must comply with specific legal requirements as outlined in the Social Welfare Act 1992 and the Social Welfare Council Rules 1992. The Legal Requirements are as follows:

1. Obtaining approval from the Social Welfare Council (SWC) to work in Nepal
2. Signing a General Agreement with the SWC
3. Signing Project Agreements for specific projects
4. Registering with relevant government ministries
5. Appointing a Country Representative
6. Setting up an office in Nepal
7. Partnering with local NGOs for project implementation
8. Complying with financial and reporting regulations

General Agreement with Social Welfare Council

What is the General Agreement?

The General Agreement (GA) is the main agreement that provides the basis for an INGO’s operations in Nepal. It is executed between the INGO and the Social Welfare Council and outlines the broad framework for the INGO’s presence and activities in the country.

What is included in the GA?

A General Agreement typically includes:

• The areas in Nepal where the INGO intends to work
• The minimum amount of annual funding the INGO commits to bringing into Nepal
• Provisions for establishing an office in Nepal
• The date by which project proposals for Project Agreements must be submitted
• Reporting requirements to the SWC
• The duration of the agreement (usually 3-5 years)
• Provisions for compliance with Nepali laws and regulations
• Procedures for amendments or termination of the agreement

Project Agreement with Social Welfare Council

What is the Project Agreement?

The Project Agreement (PA) is a tripartite agreement between the INGO, the SWC, and local partner organizations for the implementation of specific projects in Nepal. It provides details on individual projects to be carried out under the broader General Agreement.

What is included in the PA?

A Project Agreement includes:

• Background and objectives of the project
• Implementation methodology and timeline
• Budget and resource allocation
• Monitoring and evaluation plan
• Roles and responsibilities of the INGO and local partners
• Geographic areas of project implementation
• Target beneficiaries
• Expected outputs and outcomes
• Reporting requirements

INGO Registration process in Nepal

The process for establishing and operating an INGO (International Non-Governmental Organization) in Nepal includes registration, obtaining necessary permits, and appointing a Country Director.

• Step 1: Submission of Application to Social Welfare Council
• Step 2: Submit General Agreement & Proposed Programs to SWC
• Step 3: Negotiation of Final Terms of the Agreement
• Step 4: Registration with Appropriate Government Ministeries
• Step 5: Setting Up Office and Operations

Step 1: Submission of Application to Social Welfare Council

The INGO must submit an application to the Social Welfare Council expressing its intent to work in Nepal. This application should include details about the organization’s background, objectives, proposed areas of work, and financial commitments. The INGO must also provide its registration certificate from its home country, bylaws/constitution, and other relevant documents. At this stage, the SWC conducts an initial review to determine if the INGO’s proposed activities align with Nepal’s development priorities and if there is a need for its services in the country.

Step 2: Submit General Agreement & Proposed Programs to SWC

If the initial application is approved, the INGO is invited to submit a draft General Agreement to the SWC. This draft outlines the broad framework for the INGO’s operations in Nepal, including its proposed activities, financial commitments, and operational procedures. The SWC reviews this draft in consultation with relevant government ministries and may request revisions or additional information. During this stage, the INGO may also be required to present its proposed programs to a committee at the SWC.

Step 3: Negotiation of Final Terms of the Agreement

Once the draft General Agreement is approved, the INGO and SWC negotiate the final terms of the agreement. This process may involve multiple rounds of discussions and revisions. The INGO may be required to make certain commitments, such as a minimum annual financial contribution to Nepal or agreements to work in specific priority sectors or geographic areas. Once both parties are satisfied with the terms, the General Agreement is signed. This agreement provides the legal basis for the INGO’s operations in Nepal.

Step 4: Registration with Appropriate Government Ministeries

After signing the General Agreement, the INGO must register with the appropriate government ministries related to its areas of work. For example, an INGO working in healthcare would need to register with the Ministry of Health. This process ensures that the INGO’s activities are coordinated with relevant government agencies. The INGO must also appoint a Country Representative who will be responsible for its operations in Nepal. This representative should be approved by the SWC and relevant ministries.

Step 5: Setting Up Office and Operations

The final step involves setting up an office in Nepal and beginning operations. The INGO must obtain necessary permits for its office and staff, including visas for expatriate employees. It must also establish relationships with local partner NGOs, as INGOs are required to implement projects through local organizations. Within three months of signing the General Agreement, the INGO should submit proposals for specific projects to the SWC for approval. These proposals form the basis for Project Agreements, which provide detailed plans for individual projects.

Documents Required to register as an INGO in Nepal

1. Certificate of Registration from the home country, proving legal establishment.
2. Approved By-Laws governing the INGO’s operations.
3. Detailed Concept Paper/Project Proposal outlining intended projects in Nepal.
4. Formal Covering Letter introducing the INGO’s purpose and enclosed documents.
5. Draft General Agreement specifying collaboration terms with the SWC.
6. Proof of Financial Commitment (minimum USD 2,00,000 per annum) for Nepalese projects.
7. Letter of Authorization designating representatives for dealings with the SWC.
8. Identification documents of authorized personnel (Citizenship, Passport, and Bio data).
9. Documentation validating Reliable Funding Sources from outside of Nepal.

Time Taken for General Registration of INGO

The time taken for INGO registration can vary depending on the completeness of the application and the complexity of the proposed activities. Generally, the process takes 3-6 months from the initial application to the signing of the General Agreement. However, it may take longer if there are multiple rounds of revisions or if additional approvals are required from various government agencies.

Cost & Fees for General Registration of INGO

The direct costs for INGO registration in Nepal are relatively modest. The main fees include:

• Application fee: NPR 5,000
• Registration fee: NPR 15,000
• Renewal fee (annual): NPR 10,000

However, INGOs should budget for additional costs related to legal consultations, document preparation, and potential travel expenses for meetings with the SWC and other government agencies.

Obtaining Work Permits and Visas for INGO Representatives

It is mandatory for foreign staff members of the INGO who intend to work in Nepal to obtain work permits and appropriate visas.

• Submit required documents for visa and work permit processing to the relevant authorities.
• Ministry of Home Affairs provides clearance and recommends the work permit to the Department of Labor and Occupational Safety.
• The Ministry of Women, Children, and Senior Citizens provides a recommendation for the working visa to the Department of Immigration.
• The foreign national applies to convert their tourist visa to a working visa at the Department of Immigration in Kathmandu, along with the necessary recommendation letters and work permit

Appointment of Country Director

1.  INGOs operating in Nepal must appoint a Country Director who will be responsible for overseeing the organization’s activities in the country.
2. The Country Director should meet the eligibility criteria set by the Government of Nepal and have the necessary experience and qualifications.
3. The INGO must notify and obtain approval from the Social Welfare Council regarding the appointment of the Country Director.
4. In the context of Nepal, INGOs (International Non-Governmental Organizations) need to consider visa-related matters when operating within the country. Here are some points related to visas for INGOs in Nepal:

Project Agreement & Approval for INGOs

1. Develop a detailed project proposal in consultation with local partners and stakeholders.
2. Submit the project proposal to the SWC within three months of signing the General Agreement.
3. The SWC reviews the proposal in coordination with relevant line ministries and may request revisions or additional information.
4. If approved, a tripartite Project Agreement is signed between the INGO, SWC, and local implementing partners.
5. The INGO can begin project implementation after signing the Project Agreement and obtaining any additional required approvals from local authorities.

Renewal of INGOs in Nepal

INGOs must renew their registration annually at the Social Welfare Council within 3 Months before the expiry of current registration to continue operations in Nepal. The Cost for Renewal is NPR 10,000/-

Procedure of renewing INGOs

• Submit renewal application to SWC
• Provide annual progress report and audited financial statements
• Pay renewal fee
• Obtain renewed registration certificate

Documents required for INGO Renewal

• Renewal application form
• Copy of current registration certificate
• Annual progress report
• Audited financial statements
• Tax clearance certificate
• Recommendation letter from relevant ministry (if applicable)

Compliance & Requirements for INGOs in Nepal

INGOs operating in Nepal must adhere to various compliance requirements to maintain their registration and good standing with the government.

1. Financial Reporting: INGOs must submit annual audited financial statements to the SWC and relevant government agencies. They must maintain transparent financial records and ensure that funds are used for approved projects.
2. Progress Reporting: Regular progress reports on project activities, achievements, and challenges must be submitted to the SWC and line ministries.
3. Local Partnerships: INGOs are required to implement projects through local NGO partners. They must build capacity of these partners and gradually transfer project management responsibilities.
4. Employment of Nepali Staff: INGOs are encouraged to employ Nepali nationals in their operations, with expatriate staff limited to positions requiring specific expertise not available locally.
5. Visa and Work Permit Compliance: INGOs must ensure that all foreign staff have proper visas and work permits, obtained through the SWC.
6. Tax Compliance: While INGOs are generally exempt from income tax, they must comply with other applicable tax regulations, including withholding tax on employee salaries.
7. Project Agreement Compliance: All activities must be conducted within the scope of approved Project Agreements. Any significant changes require prior approval from the SWC.
8. Coordination with Local Authorities: INGOs must coordinate their activities with local government bodies and participate in district-level coordination meetings.
9. Adherence to National Priorities: INGO activities should align with Nepal’s development priorities as outlined in national plans and strategies.
10. Code of Conduct: INGOs must adhere to the Basic Operating Guidelines (BOGs) developed by the donor community in Nepal, which outline principles of neutrality, transparency, and accountability.

Minimum Amount of Donation to be made by INGOs

According to SWC regulations, INGOs are required to commit a minimum annual contribution of US$200,000 for their activities in Nepal. This amount should be brought into Nepal from external sources and used for approved projects and programs. The minimum contribution helps ensure that INGOs have sufficient resources to make a meaningful impact and sustain their operations in the country.

Appointment of Local Partners for Implementation of Project

INGOs are mandated to implement their projects through local NGO partners in Nepal. This requirement aims to build local capacity and ensure sustainability of development efforts. When selecting local partners, INGOs should consider:

• The partner’s legal registration and good standing with authorities
• Alignment of objectives and expertise with the proposed project
• Capacity and experience in project management
• Financial management systems and transparency
• Local knowledge and community relationships

INGOs must clearly define roles, responsibilities, and financial arrangements with local partners in their Project Agreements.

Setting Up Office in Nepal

INGOs are required to establish an office in Nepal to oversee their operations. The process involves:

1. Obtaining approval from the SWC for office establishment
2. Registering with local authorities and obtaining necessary permits
3. Appointing a Country Representative approved by the SWC
4. Hiring staff and setting up administrative systems
5. Registering with tax authorities and obtaining a Permanent Account Number (PAN)

The office serves as the INGO’s official address in Nepal and is responsible for liaison with government agencies, project management, and compliance with local regulations.

Restrictions for INGOs in Nepal

INGOs operating in Nepal face certain restrictions, including:

1. Prohibition on direct implementation of projects without local partners
2. Limitations on engaging in political activities or those against national interests
3. Restrictions on fundraising within Nepal
4. Limitations on the number of expatriate staff and duration of their assignments
5. Prohibition on using funds for religious proselytization
6. Restrictions on working in certain sensitive areas without special permissions

Laws governing INGO in Nepal

The primary laws governing INGOs in Nepal include:

1. Social Welfare Act 1992
2. Social Welfare Council Rules 1992
3. Association Registration Act 1977
4. Foreign Investment and Technology Transfer Act 2019
5. Labor Act 2017 (for employment-related matters)
6. Immigration Act 1992 (for visa regulations)

INGOs must also comply with various sector-specific laws and regulations depending on their areas of work.

Authorities governing INGO in Nepal

The key authorities overseeing INGO operations in Nepal are:

1. Social Welfare Council (SWC) – primary regulatory body
2. Ministry of Women, Children and Senior Citizens – oversees SWC
3. Ministry of Home Affairs – involved in security clearances
4. Ministry of Finance – oversees financial matters and tax issues
5. Relevant line ministries (e.g., Health, Education) for sector-specific oversight
6. Department of Immigration – handles visa matters
7. District Administration Offices – local-level coordination

Restricted Areas: Certain areas of Nepal, especially near international borders, require special permits for foreigners to enter. INGOs working in or near these restricted areas should be aware of these regulations and obtain the necessary permits for their staff if required.

Read More:

• NGO Registration Process in Nepal
• An Overview of NGO and INGO Law in Nepal
• Renewal and Compliance of NGO and INGO in Nepal
• Profit Not Distributing Company Registration in Nepal
• NGO and INGO Lawyer and Legal Services in Nepal

Also Read: Social Welfare Council Act, 1992 Association Registration Act, 1977

Frequently Asked Questions

Contact NGO and INGO Lawyer in Nepal

Disclaimer: This material is presented solely for informational purposes, without constituting legal advice, counsel, or solicitation, and no liability shall arise from any actions, omissions, or reliance on its contents, directly or indirectly, in any manner whatsoever, irrespective of the jurisdiction or specific circumstances.