Section 32: National Treatment to be Accorded

1) In respect of the terms applicable to the management, maintenance, use, transfer and sale of any foreign investment made in Nepal by a foreigner, subject to this Act and other prevailing law, after the commencement of this Act, such foreign investment shall, after the investment is brought into, and until it remains in Nepal, be accorded national treatment no less favourable than that accorded to any investment made by a Nepali person, in respect of the terms applicable to the management, maintenance, use, transfer and sale of such investment.

2) Notwithstanding anything contained in sub-section (1), in the case of a foreign investment approved prior to the commencement of this Act, the provisions contained in the prevailing law relating to foreign investment in force at the time of making such an investment shall apply, and no change shall, without his or her consent, be made that may prejudice to any facility obtained by any foreign investor in accordance with that law.

3) The following protection shall be accorded to any industry with foreign investment in accordance with sub-section (1):

(a) The industry or enterprise with foreign investment shall be accorded the same treatment as accorded to any industry of the same nature with investment made by a Nepali citizen.

(b) The industry and enterprise with foreign investment shall be free to determine the price of goods and services, subject to the prevailing law.

(c) No industry or enterprise with foreign investment shall be prevented from doing trade, as prescribed, being limited to that industry.

(d) No industry or enterprise with foreign investment shall be restricted from repatriating profit and investment, paying interest on, and repaying the principal of a loan.

4) Notwithstanding anything contained in sub-section (1), national treatment shall not apply in respect of the following matters:

(a) Matters relating to the creation of such intellectual property rights, limits thereof, transfer of title thereto or provisions requiring compulsory licensing for the use thereof as specified in any agreement made under the World Trade Organisation,

(b) Matters relating to the exemption or facility, if any, granted to any domestic industry or goods in accordance with the prevailing Nepal law relating to public procurement,

(c) Matter relating to any grant or concession to be made or provided by the Government of Nepal,

(d) Matter of non-commercial services to be provided by the Government of Nepal,

(e) Such measures relating to financial services as may be adopted or managed by the Government of Nepal upon considering appropriate on matters such as matters relating to the protection of investors, participants in the securities market, insurance policy holders or insurance policy claimants, or relating to financial institutions having liability to safeguard the financial interests of any persons or relating to maintaining soundness, morality or financial responsibility of financial institutions,

(f) Matters involving liability or provision to accord special treatment by the Government of Nepal because of being a party to any regional or multilateral economic, monetary organisation or organisation of similar nature to which the Government of Nepal is or will be a party,

(g) Matters relating to the terms that may be specified by the regulatory body in accordance with the prevailing law in respect of repatriation of investment to a foreign country, repayment of loan (including principal, interest and fees), payment of service fees,

(h) Matters relating to the protection of human, animal and plant health or the environment.