|
THE FOREIGN
INVESTMENT AND |
AN ACT MADE TO PROVIDE FOR MATTERS
RELATING TO
FOREIGN INVESTMENT AND TECHNOLOGY TRANSFER
Published in Nepal Gazette
12 November, 1992 (2049/7/27)
First Amendment Published in Nepal Gazette
24 January, 1996 (2052/10/10)
Some Nepal Laws Revision Act
Published in Nepal Gazette
10 August, 2000 (2057/4/26)
Preamble: Whereas, in the process of industrialization of the country, it is expedient to promote foreign investment and technology transfer for making the economy viable, dynamic and competitive through the maximum mobilization of the limited capital, human and the other natural resources.
Be it enacted by Parliament in the twenty first year of the reign of His Majesty King Birendra Bir Bikram Shah Dev.
This Act may be called "The foreign Investment and Technology Transfer Act, 1992."
It shall come into force at
once.
Definitions:
Unless the subject or context otherwise requires, in this Act,
"Industry" means any
industry as referred to in Section 3 of the Industrial Enterprise Act, 1992.
"Foreign Investment" means
the following investment made by a foreign investor in any industry:
1. Investment in Share (Equity)
2. Reinvestment of the earnings derived from the
investment as referred to in sub-section (1)
above
3. Investment made in the form of loan or loan facilities.
"Technology Transfer" means
any transfer of technology to be made under an agreement between an industry
and a foreign investor on the following matters:
1. Use of any technological right, socialization, formula,
process, patent or technical know-how of foreign origin.
2. Use of any trademark of foreign ownership.
3. Acquiring any foreign technical, consultancy,
management and marketing service.
"Foreign Investor" means
any foreign individual, firm, company or corporate body involved in foreign
investment or technology transfer including foreign government or
international agency.
"Board" means the
Industrial Promotion Board, constituted under Section 12 of the Industrial
Enterprises Act, 1992.
"Department" means the
Department of Industries or Department of cottage and Small Industries of
His Majesty's government or any other department, office or agency as
specified by His Majesty's Government.
"Prescribed" or "As
prescribed" means prescribed or as prescribed in rules made under this Act
or in an order issued by His Majesty's Government by notification published
in the Nepal Gazette.
Permission
to be Obtained:
Permission of the Department
shall be required to be obtained for foreign investment of technology
transfer.
A person desiring to avail
the foreign investment or technology transfer shall be required to make an
application to the Department in the prescribed particulars for obtaining
permission in that behalf.
If an application is made
pursuant to sub-section (2) above, the Department shall, in case of an
industry with fixed assets up to five hundred million rupees, itself and in
the case of an industry with with fixed asses in excess thereof, in accordance
with the decision of the Board, grant permission within thirty days from the
date of application. the Department shall communicate the decision made in
regard to such permission to the applicant.
Not withstanding anything
contained in subsections (1) and (2) above, no permission shall be granted for
making foreign investment in the industries set forth in the Annex.
Provided that permission may be granted fro the transfer of technology in such
industries.
................... (Deleted by
some Nepal Laws Revision Act.)
Facilities
and Concessions:
1) .................. (industries with a fixed asset of up to an amount of ten million rupees
shall be named as small industries (Deleted by some Nepal Laws Revision Act.)
1a) A foreign investor shall be levied income tax at a rate
of fifteen percent only, on the income earned from foreign technical as well
as management service fees and royalty.
2) A foreign investor making investment in foreign currency
shall be entitled to repatriate the following amount outside the Kingdom of
Nepal:
a) The amount received by the sale of the share of foreign
invest as a whole or any part thereof.
b) The amount received as profit or dividend in lieu of the
foreign investment.
c) The amount received as the payment of the principal of
and interest on any foreign loan.
3) A foreign investor shall be entitled to repatriate
outside the Kingdom of Nepal the amount received under the agreement for the
transfer of technology in such currency as set forth in the concerned
agreement.
Provisions
Relating to Visa:
1) A foreign
national visiting the Kingdom of Nepal in connection with undertaking any
study or carrying out any research with the objective of making investment in
the Kingdom of Nepal shall be provide a no tourist visa for up to six months.
2) A foreign investor or dependent family or authorized
representative of such a foreign investor and dependent family of such
authorized representative shall be provided a business visa until the foreign
investment is retained.
Provided that a foreign investor who, at a time, makes investment in a amount
no less than one hundred thousand United States dollar of in convertible
foreign currency equivalent thereto, and his dependent family shall be granted
a residential visa until such investment is retained.
Settlement
of Disputes:
1) If any dispute arises between a foreign investor,
national investor or the concerned industry, the concerned parties shall be
required to settle the dispute by mutual consultations in the presence of the
Department.
2) If the dispute could not be settled in the manner as
referred to in sub-section(1) above, it shall be settled by arbitration in
accordance with the prevailing arbitration rules of the United nations
Commission of International Trade Laws (UNCITRAL).
3) The arbitration shall be held in Kathmandu. The laws of
Nepal shall be applicable in the arbitration.
4) Notwithstanding anything contained in subsections (1),
(2) and (3) above, disputes arising in regard to foreign investment made in
the industries with investment as prescribed may be settled as mentioned in
the foreign investment agreement.
Power to
Frame Rules:
His Majesty's Government may frame
necessary rules for carrying out the objectives of this Act.
This Act
to Prevail:
Not withstanding anything contained in the existing laws, matters
stipulated under this Act and rules made there under shall be dealt
accordingly.
9(A) Power to Make Alternation or Amendment in Annex:
His Majesty's Government may, by notification in the Nepal Gazette, make
necessary alterations for amendments in Part (B) of the Annex.
Repeal and
Savings:
1) The Foreign
Investment and Technology Act, 1981 is hereby repealed.
2) All acts performed or action taken under the Foreign
Investment and Technology Act, 1981 shall be deemed to have been performed or
taken under this Act.
Annex:
(Relating to sub-section (4) of Section (3))
Industries not to be granted permission for making foreign investment
Part (A)
Cottage Industries
Personal Service business (Business such as Hair Cutting, Beauty Parlour, Tailoring, Driving, Training etc.)
Arms and Ammunition Industries
Explosives, Gunpowder
Industries related to Ratio-Active Materials
Real Estate business (Excluding construction Industries)
Motion Pictures Business (Produced in national languages and the language of eth nation).
Security Printing
Currencies and Coinage Business
Part (B)
Retail Business
Travel Agency
Trekking Agency
Water Rafting
Pony Trekking
Horse Riding
Cigarette, Bidi (Tobacco), Alcohol (excluding those exporting more than 90%)
Internal courier Service
Atomic Energy
Tourist Lodging
Poultry Farming
Fisheries
Bee-Keeping
Consultancy Services such as Management, Accounting, Engineering and Legal Services