The Electronic Commerce (E-Commerce) business in Nepal is an important step for anyone wanting to sell products and services online. From the basic to the complex, things are accessible with just one click.
With the increase in the use of the internet, many people are shopping online, from daily essentials like shampoo and fresh fruits to larger items like sofas, shirts, and electronic gadgets.
Nepal has recently promulgated the E-Commerce Act, 2081, which was certified on 3rd Chitra 2081 and is set to come into effect thirty-one days from the date of certification. This Act regulates e-commerce businesses in Nepal, aiming to protect consumer rights, promote fair trade practices, and ensure proper business compliance.
This article provides an overview of the process for incorporating an e-commerce business in Nepal, along with the key compliance requirements under the newly enacted law.
What Is the Governing Law for E-Commerce in Nepal?
Nepal’s e-commerce market has seen rapid growth, with hundreds of businesses operating and transaction volumes reaching billions of rupees. Social media platforms like TikTok, Facebook, Instagram, and WhatsApp drive this boom.
However, many online stores and sellers remain unregistered, operating outside formal regulation and tax systems.
Here are two major laws that govern the registration of e-commerce companies in Nepal. They are:
- Companies Act 2063 –The law that regulates company registration and the operation of companies in Nepal
- E-Commerce Act 2081 – This law regulates the listing and compliance of e-commerce companies in Nepal
What Relevant Details Must E-Commerce Platforms Show in Nepal?
Now, talking about the e-commerce platform, it is a digital space that allows businesses and individuals to buy and sell goods and services online.
E-commerce platforms handle various functions such as product display, customer service, online payments, and order tracking, making it easier for both sellers and buyers to transact without needing a physical store.
According to Section 4 of the E-Commerce Act, 2081 has provisions about details to assist buyers regarding their trade or business activities:
- Name of the electronic platform
- Name of the business, address, registered entity, and registration certificate number,
- Full address of the main office, registered office, and any branch office (if applicable)
- Details of any special license obtained to run a specific type of business
- Clear description of the business activities, whether it operates as an intermediary (like a marketplace) or directly sells products/services
- VAT Registration Number or Permanent Account Number (PAN)
- Contract details for customer service, including email, phone, mobile number, fax, or any other contract method
- Contract information of the person or department responsible for handling customer complaints (email, phone number, and address)
- Listing number issued after the business is officially listed on the e-commerce platform
How Can You Register for E-Commerce?
Under the E-Commerce Act, 2081, Section 5, individuals or businesses selling goods or services online in Nepal must register on the official e-commerce portal.
Here is the streamlined procedure:
Step 1: Submit Application to the E-Commerce Registration Portal
E-Commerce platform owners must submit an application through the official E-Commerce Portal established by the Department of Industry, along with all the required business details.
Step 2: Submission by Existing E-Commerce Platforms
Businesses already operating e-commerce platforms at the time this Act comes into effect must submit their listing applications within three months from the date of enactment.
Step 3: Review and Issuance of Platform Listing Number
Within seven days of receiving the application, the Department will review the details and send the platform listing number and other relevant information to the applicant through electronic means.
Step 4: Update Business Information Promptly
If a listed business makes any changes, such as adding or closing branches or outlets, it must update the information on the e-commerce portal within seven days of the change.
Where Should You Register Your Online Business?
In the context of Nepal, online businesses are first registered in the Office of the Company Registrar (OCR) and the Department of Commerce, Supplies and Consumer Protection (DOCSP), both of which function under the Ministry of Industry, Commerce, and Supplies.
Here is a business that must first be registered under one of the following categories:
- Private Limited Company through the Office of the Company Registrar (OCR)
- Sole Proprietorship (Individual-Owned Firm) and (Jointly Owned Firm) through the DOCSCP
What Is Required to List on the E-Commerce Portal?
For the registration process of e-commerce, you must collect the right documents to ensure a smooth process. The necessary documents are listed below:
- Basic Business Details – including the business name, address, legal status, and registration certificate number
- Ownership Details – provide the proprietor’s name and ID, for a partnership firm, provide details of the partners, and for a company or organisation, provide the identity of the director(s)
- A clear and detailed description of the business activities
- Permanent Account Number (PAN) or Value Added Tax (VAT) Registration
- Contact information, including phone number, email, and business address
- Number and locations of branches or outlets, if applicable
- Any additional information as required by the electronic portal
What Are the Offences and Punishments Under the E-Commerce Act 2081?
In accordance with Chapter 4 of the E-Commerce Act 2081, it has provisions relating to offences and punishments.
Online businesses or platforms are also held accountable for complaints relating to goods and services sold through them.
In general, offences include running a business without registration, not disclosing key product details, and failing to meet intermediary liabilities. These activities may result in fines ranging from NPR 20,000 to NPR 100,000, with the right to appeal to the Director General within seven days.
There is a provision relating to serious offences, such as fraud or repeated violations. These activities lead to compensation between NPR 40,000 and NPR 500,000, as well as imprisonment of six months to three years or both, under Section 23 of this Act.
The government attorneys are prosecuting the case, and the prosecutor is carrying out the case in the newly established ‘Consumer Court’ with the Government of Nepal on behalf of the public.
Conclusion
The Electronic Commerce Act, 2081 marks a major step in regulating Nepal’s growing digital marketplace. It makes e-commerce registration mandatory, promotes consumer protection, and ensures fair trade practices.
To legally operate, businesses must register through the official portal, submit required details, and stay compliant with the law. Failure to do so may result in strict penalties, including fines and imprisonment.
As Nepal embraces digital commerce, this Act provides a much-needed framework for accountability and trust in the online business environment.
FAQs
Q. Who must register?
A. Anyone selling goods or services online in Nepal must register on the official e-commerce portal.
Q. What documents are needed?
A. Basic business info, ownership details, business activities, tax registration, and contact info.
Q. What are the penalties for violations?
A. Fines from NPR 20,000 to NPR 100,000 for minor offences; up to NPR 500,000 and/or imprisonment for serious offences.
Babita Pariyar
Babita is a law student with a keen interest in property accountancy and legal compliance. She contributes insightful, well-researched articles that reflect a fresh and analytical perspective on evolving legal matters.
