Real Estate Licensing Under the Land Revenue (Eighth Amendment) Regulations, 2082

The Government of Nepal has formally introduced a mandatory licensing system for individuals and institutions engaged in land and housing transactions. This new requirement was enforced through the Land Revenue (Eighth Amendment) Regulations, 2082, published in the Nepal Gazette (Volume 75, No. 27) on Bhadra 12, 2082 BS.

The amendment operationalizes Sections 26A and 26B of the Act and incorporates two new rules Rule 23J and Rule 23K into the Land Revenue Regulations. With these changes, Nepal has officially entered the implementation phase of real estate licensing, making it compulsory for anyone wishing to conduct property transactions to obtain a Real Estate License before engaging in business.

This article provides a simplified yet comprehensive explanation of the requirements.

1.     Application for Real Estate License (Rule 23J, Section 26A)

Any natural or legal person intending to conduct real estate transactions must apply for a license in the format prescribed under Schedule–8 (अनुसूची–८).

The application must be submitted to the designated authority such as local, provincial, or federal authorized under Section 26B(1).

Before issuing the license (Schedule–9 format), the authority conducts an inquiry into the applicant’s credibility, financial capacity, and business preparedness. Only applicants who meet the required standards will be licensed.

2.     Required Documents (Schedule–8 Application Requirements)

A complete application must include:

1.      Company Registration Certificate with real estate–related objectives

2.      Memorandum of Association (MOA)

3.      Company Share Lagat

4.      Permanent Account Number (PAN/VAT) Certificate

5.      Updated Company Adhyabedan/Adhyabhik Patra

6.      Latest Tax Clearance Certificate

7.      Detailed Business Plan including:

o    Company background and profile

o    Office, manpower, shareholders

o    Yearly income–expenditure projection

o    Estimated number and value of transactions

8.      Board Minute authorizing application for the license

9.      Company website, email, and contact number

3.     License Fee (Rule 23K)

The fee structure distinguishes operators based on the size of their transactions:

·         NPR 5,00,000 – for transactions up to NPR 50 million at a time

·         NPR 10,00,000 – for transactions exceeding NPR 50 million at a time

4.     Renewal of License (Rule 23K(2)(4), Section 26B)

A real estate license is not permanent and must be renewed periodically.

Renewal Timeline

·         Must apply 35 days before expiry.

Renewal Fees

·         NPR 4,00,000 – for licensees under the NPR 50 million category

·         NPR 8,00,000 – for licensees above the NPR 50 million category

Documents Required for Renewal

·         Details of annual transactions

·         Audit Report of the previous year

·         Tax payment certificate of the previous year

Late Renewal

·         Can apply within 90 days after expiry

·         Additional late fee: NPR 50,000

The licensing authority renews the license only after conducting necessary inquiries.

5.     Mandatory Use of Geo-Information System (Rule 23A)

To promote transparency, Rule 23A introduces a technological requirement:

·         Licensees must operate real estate transactions through the Geo-Information System (GIS).

·         A licensee who does not operate a Land Service Center may use a Center operated by another licensed entity.

This aims to digitize transactions, reduce fraud, and modernize the real estate sector.

Legal Significance of the Licensing System

The new licensing regime aims to:

·         Enhance transparency and accountability

·         Prevent money laundering and unlawful property dealings

·         Improve regulatory oversight in high-value transactions

·         Safeguard consumers through a credible licensing framework

·         Strengthen revenue collection through structured fees and renewals

These measures collectively modernize Nepal’s real estate sector and align it with international regulatory standards.

Conclusion

The Land Revenue (Eighth Amendment) Regulations, 2082, have made a real estate license mandatory for all individuals and entities involved in property transactions. The license valid for up to five years requires substantial documentation, financial transparency, and adherence to GIS-based operations.

Following earlier amendments to money laundering and business environment laws, this licensing requirement now ensures that brokers, consultants, and intermediaries operate within a regulated framework. With the Gazette publication, the entire licensing system has become legally effective, marking a major shift toward accountable and transparent real estate practices in Nepal.

Sample Application for Real Estate License

Note: For assistance with real estate licensing, documentation, or regulatory compliance, Sherpa Law Associates offers dedicated legal services to support your requirements. If you have any queries contact us at +977 9846000030, Email: Sherpalaw.nepal@gmail.com