Ordinance to remove legal impediments to investment

After President Ramchandra Paudel issues an ordinance in accordance with the recommendations of the Council of Ministers, the arrangements made there will immediately come into force as laws. The government says that this ordinance has been brought to facilitate the work of promoting investment in Nepal.

"To recommend to the Honorable President to issue an ordinance to amend some Nepal Acts related to investment facilitation," said the decision of the Council of Ministers. The government has brought the ordinance by amending various provisions of 10 Acts. These include the Land Act, 2021, National Parks and Wildlife Protection Act, 2029, Wildlife Protection Act, 2029, Land Acquisition Act, 2034, Electronic Transactions Act, 2063, Special Economic Zones Act, 2073, Public-Private Partnership and Investment Act. , 2075, Foreign Investment and Technology Transfer Act, 2075, Forest Act, 2076 and Industrial Business Act, 2076 are about to be amended.

Various ministries and agencies of the government had previously sent recommendations to the Ministry of Law to amend various provisions of the 8 Acts. After further study and consultation, the Ministry of Law concluded that 10 Acts should be amended and prepared an ordinance and sent it to the Council of Ministers on Monday, from where it was decided to recommend the ordinance to the President, Law Minister Padam Giri informed. A provision has been added to the Lands Act, 2021 through the

Ordinance. It has been arranged that industries, establishments, companies or organizations using land in excess of the limit can submit an application to the Government of Nepal through the Ministry for approval within one year from the date of commencement of this sub-section. Previously, such an application had to be submitted within three months of starting to use the land. Arrangements for keeping records of land in excess of such limits have also been made through the ordinance.

The government has also amended the National Parks and Wildlife Protection Act, 2029. The government has provided that any area within a national park, reserve or conservation area can be designated as a highly sensitive area by publishing a notice in the gazette as deemed necessary. According to the regulations made by the government, a certain area within the national park, reserve or conservation area will be designated as a highly sensitive area for industrial operations or the way to extract rocks, stones or soil as well as minerals from there.

The government has amended the Land Acquisition Act, 2034 and provided that 'when determining the compensation according to this section, the compensation amount shall not be determined more than three times the minimum assessment determined for the purpose of registration'. The Electronic (Electronic) Transactions Act, 2063 has made new provisions regarding foreign exchange payments. A legal provision has been made to facilitate the importation of funds earned by exporting software or information technology services developed by firms or companies based on information technology established in Nepal. A legal arrangement has also been made to provide one-time facility for such companies or firms to obtain foreign currency necessary for setting up and operating a branch office or unit abroad. For this, the person has also received legal recognition.

By amending the Special Economic Zones Act, 2073, the government has removed section 7, which hinders the transfer of industries to special economic zones. Section 9 of the Public-Private Partnership and Investment Act, 2075 provides for the Monitoring and Facilitation Committee. There is a provision to make the finance secretary a member of the said committee.

By amending the Foreign Investment and Technology Transfer Act, 2075, the government has made provision for technology transfer, etc. According to this, it is arranged that an industry or company established and operating in Nepal can transfer technology to an industry, firm or company located abroad. Previously, due to the lack of such a legal system, there were disputes about technology transfer in foreign investment industries and projects. The government has also made provision in the ordinance that the foreign currency received for the transfer of technology should be brought into Nepal with the permission of Nepal Rastra Bank.

The government has also arranged that foreign-invested industries can produce goods or services through mutual agreements (contracts) or sub-contracts (sub-contracts) with other industries with similar objectives. Amending the Forest Act, 2076, the government has provided that only 'rocks, stones and soil' should be used in forest production. Earlier, the definition of forest produce also included 'rock, river and mineral material'. The government is holding an investment conference on May 16 and 17. Domestic and foreign investors have been invited to Kathmandu for the conference. Ministers say that the ordinance was introduced in the conference so that the laws of Nepal do not hinder investment. After the President promulgates the ordinance, it will be implemented as a law.