Legal Basics in Brief

(i) Private Firm

1. A private firm means a firm in which an individual conducts business in trade and industry.
   
2. A private firm must register itself in the prescribed form along with the prescribed fees.
   
3. If the private firm is a business firm it should apply in the Department of Commerce and register itself in the Nepal Chamber of Commerce along with the application letter, and on its recommendation, the firm should register itself in the Department of Commerce, which will issue the certificate.
   
4. After the expiry of the registration, the firm should renew it every year, paying the prescribed fees.

(ii) Partnership

1. Partnership is individuals agreeing to conduct business activities under one name.
   
2. A partnership firm must register itself with the agreements made by the partners in the prescribed form along with the prescribed fees.
   
3. While registering the firm, it should apply either to the Department of Industries or to the Department of Commerce, depending in its function. If it is a commercial firm, it should apply to the Department of Commerce and register itself in the Nepal Chamber of Commerce along with the application letter, and on its recommendation, the firm should register itself in the Department of Commerce, which will issue the certificate.
   
4. Without the consent of the partners, others cannot be made partners. In the event of decease of a partner, the partnership firm will be dissolved.
   
5. The firm should renew the registration and pay the prescribed fee within 15 days after the end of every fiscal year.

(iii) Private Company

1. A private company is a company registered in the Company Registrar’s Office in accordance to the Company Act, 2053.
   
2. A private company can have a maximum of 50 shareholders.
   
3. In accordance to the Company Act, 2053, a private company, while registering, should prepare (submit) copies of Memorandum of Association and Article of Association and register itself in the Department of Industry (if it is in industry) or the Department of Commerce (if it is in trade). It should also be registered with the Internal Revenue Department and receive a permanent account number.
   
4. If the private company has a provision of having a Board of Directors, the tenure of office of the Directors and the quorum for the meetings shall be as provided in the Articles.
   
5. Within 3 months from the date of expiry of the fiscal year (end of every Ashad), the private company should conduct a general meeting and  discuss and  pass resolutions on the report of the auditor, the balance sheet as well as the profit and loss accounts of the company, and the appointment of the auditor.
   
6. The share of a private company cannot be freely transferred or sold.
   
7. Dissolution:A private company can be dissolved on grounds mentioned in the Act.

(iv) Public Company

1. A public limited company is a company established in accordance to the Company Act, 2053.
   
2. Registration:For registering a public company, at least seven promoters must tender an application in the prescribed form along with the prescribed fees to the Company Registrar’s Office. It should register itself in the Department of Industry (if it is in industry) or the Department of Commerce (if it is in trade), and receive a certificate.  It should also register itself with the local Internal Revenue Department and receive a permanent account number.
   
3. The minimum number of shareholders in a public company is seven with the maximum being unlimited. The amount of each share should be Rs. 100/-.
   
4. A public company should have its own manager, a charter and prospectus.
   
5. Within 6 months from the date of expiry of the fiscal year, the public company should call a general meeting. It should discuss and pass resolutions on the report of the Board of Directors, the report of the auditor, the balance sheet as well as the profit and loss accounts of the company, and the appointment of the auditor and his remuneration.
   
6. The Board of Directors:In a public company, there must be a Board of Directors with least three and not exceeding 11 members. The term of office of a Director is 4 years. The meetings of the Boards of Directors should be held at least 6 times a year.  The Board of Directors executes the decisions of the management of the company and of the works to be done by the company.
   
7. Dissolution: A private company can be dissolved on grounds mentioned in the Act.

(v) Patent

1. Patent means an invention.
   
2. Registration:While registering a patent, one must apply in the prescribed form along with the prescribed fees, submitting all available proofs.
   
3. Validity Period:The validity period for a patent is of 7 years.  It has to be renewed in the prescribed form along with the prescribed fees within 35 days of the expiry date.

(vi) Trademark

1. Trademark is a mark or a sign used on ones produced goods so as to differentiate them from goods produced by others.
   
2. Registration:While registering a trademark, one must apply with four copies of samples in the prescribed form along with the prescribed fees at the Department of Industries.
   
3. Validity Period: The trademark should be into use within one year of its registration. The validity period for a trademark is seven years.  After its expiry, it has to be renewed in the prescribed form along with the prescribed fees.

(vii) Copyright

1. Copyright is the right of an individual over his creation.
   
2. Registration:It is not compulsory to register copyright, but if interested, an application should be given to the Registrar in the prescribed form.
   
3. Period:The period for copyright will remain throughout the writer’s lifetime. Even after his death, the copyright will be valid and protected for 5 years from the year of his death.
   
4. With an agreement in written form, the copyright ownership can be transferred to others, in part or in whole.

Following is a document in Nepali language in Microsoft Word format (.doc) and Acrobat Reader format (.pdf).