Business licenses and business permits and Provision of establishing entrepreneurs' business in Nepal

Business Licenses and Business Permit

Any business that wants to enter a market must get a number of licenses and permissions. There will be several licensing deals formed. Such a contract is made to safeguard intellectual property rights so that there won't be any restrictions or complications very soon. To operate the business in accordance with the terms and circumstances, a legal permit must also be obtained. Therefore, an entrepreneur must formally reach an agreement regarding the following in order to operate a successful business:

Business Licenses

Depending on the type of business (sole proprietorship, partnership, cooperative, or joint stock company) and the sector it plans to enter, the entrepreneur must obtain a business license. A business license is a permission granted by the state to conduct commercial operations in a certain area. Different types of licenses are needed depending on the nature of the business. In the case of a sole proprietorship, the business license is obtained at a low level and is immediately suspended so long as the business is operated by a single person or as a sole proprietor. If the sole proprietor passes away, the license expires; otherwise, it remains in effect until the business is no longer viable. While in the case of a partnership, even if one of the partners passes away, the license continues as long as the company is in operation. But the license ought to be applied for at both the local and federal levels. The same thing occurs with a joint stock company.

• Technology license
• Trademark license
• Copyright license

Business permit

A business permit is a legal document that serves as evidence of compliance with the specific local or state rules that govern goods sales, skeletal appearances, and public safety. According to the type of business and the location of the business, it refers to getting one or more permissions to operate the business. For instance, if an entrepreneur wishes to launch a company as a Gorkha strong beer distributor in Nepal, he or she must first obtain a business license (either it is sole proprietorship or partnership). In addition, he or she must determine where to operate and distribute in various places, such as Kotteshowr, Baneshowr, Tripureshowr, etc. In this instance, the permission is exclusively issued for the sites mentioned above. He/she is not allowed to distribute in any other place than those where he/ she is permitted.

Provision of establishing Entrepreneurs’ business in Nepal

First Phase: Pre- start phase

Prior to starting a business, an entrepreneur must complete the following legal requirements:

• Registration of firm: The process of registering a company in Nepal is very complicated and time-consuming. To register a private business firm in Nepal, there are specific steps that must be taken. According to Section 3 of the Private Firm Registration Act of 2014, the business institute must be registered with the Department of Cottage and Rural Industry if it relates to cottage and rural industry, the Department of Commerce if it has any connection to commerce, and the Department of Industry if it relates to any other category of industries. The form that asks for the name and address of the business, the full names of the owners, etc., must be filled out by the person who wishes to register a company.
• Clearance Certificate: It is a document that attests that a company has paid all of its tax obligations at the time it ceases to exist or is transferred to a new owner.
• Industry license and Business License/ Business permit: The license and permit details have previously been covered above.
• Foreign exchange certificate (in the case of a commercial bank): A commercial bank can exchange foreign cash using this certificate. Under Nepal's Foreign Exchange (Regulation) Act of 2019, the government offers it.
• Export/ Import license (in the case of importer or exporter/ export or import trade): It is crucial for both import and export trade. After the trader has met the requirements of the trader Export and Import (Control) Act, 2013 B.S., it is given to them.
• PAN number (Permanent Account Number): It is most frequently applied to small businesses. It is made available to even the smallest business.
• Membership of respective trade: Membership in the relevant trade is required for the smooth running of the business.

Second Phase: Start-up phase

This phase, which marks the beginning of a commercial initiative, is carried out when the legal requirements for the start-up of the enterprise have been satisfied. It has to do with the following points or laws' operations or activities:

• Renewal Fees: Renewal costs refer to the cost incurred to extend the duration for which a document, such as a license or contract, is still in effect or is legally permitted.
• Audit report: Audits assist small business owners in ensuring that their enterprises are operating profitably and successfully. In some situations, the high level of assurance provided by an audit is necessary and no other surrogate or replacement will suffice. Third parties, such as investors and lenders, may want assurance that the financial statements on which they are basing their choices accurately reflect the state of the company's financial condition.
• Quarterly financial report: To understand the financial status over a brief period, the financial report for each quarter of the year should be well-created and thoroughly examined.
• Quality assurance and technical standard: The pricing and the quality of the product should be compatible. It is important to keep up the high standard and superior quality of the product.
• Tax payments (employees, staff, organization): For the form to function effectively and legally, the tax requirement with regard to the staff, employees, and even the form itself must be guaranteed.
• Insurance Premium: The purpose of insurance is to shield oneself against monetary loss brought on by risks like fire, earthquakes, and so forth. Even the staff should have insurance.
• Employee safety and health condition: A key concern is the workers' safety. As the worker could have to operate dangerous machinery, etc.

Third Phase: Post start-up phase

It is the last phase of the process when a new venture is being established. The following laws pertaining to consumers are highlighted in this phase:

• Consumer protection/ human rights: According to the Consumer Protection Act of 2054, it is practical to make provisions for protecting consumers from irregularities regarding the quantity, quality, and prices of consumer services and goods, ensuring that no one lessens or removes the uniqueness or usefulness of consumer services and goods, preventing perspectives in which monopolies and unfair trade practices may lead to a rise in prices, as well as preventing false and inaccurate propaganda regarding the use and usefulness of consumer services and goods.
• Product liability laws: It refers to the responsibility of any or all parties, including those in the production chain of a product, for any waste or damage brought on by that product. Owners of retail stores, wholesalers, assembly manufacturers, and component part manufacturers are included in this group. Lawsuits involving defective goods are filed when those products harm or injure a consumer, a recipient of a gift, a recipient of a loan, etc.

Other considerations include environmental law, health protection, and so forth.

Reference:

Agrawal, Govinda Ram (2014). Entrepreneurship and small business management in Nepal . KTM: M.K Publishers and Distributors.

Baird. M.L. (2003). Engineering your Start-up: A Guide for the High-Tech Entrepreneur. Professional Publications.

Kaplan. Jerry. (2001) Startup: A Silicon Valley Adventure. Replica Books.

masons, P. (2013). http://www.out-law.com/. Retrieved from out-law: http://www.out-law.com/topics/commercial/supply-of-goods-and-services/product-liability-under-the-consumer-protection-act/

Initiative, N. B. (2013). http://www.includenepal.org. Retrieved from includenepal: http://www.includenepal.org/images/publications/ebp.pdf National Business Initiative