Shares and Capital Market Law

Shares and Capital Market Law

We advise on share and capital market matters for corporate houses, banks, private equity funds, investment banks and underwriters who need a lawyer that understands how a securities deal moves through SEBON and onto NEPSE, not general corporate counsel applied to a capital markets problem.

The Legal Framework

Nepal’s capital market runs on the Securities Act, 2063 (2007), which governs the issuance, registration and trading of securities, alongside the Companies Act, 2063 (2006) for the underlying corporate structure. The Securities Board of Nepal (SEBON) is the statutory regulator, and the Nepal Stock Exchange (NEPSE) is the sole exchange where approved securities are listed and traded.

Only a public limited company can issue shares to the public, and any such issuance must be registered with SEBON before it happens, with SEBON issuing a Securities Registration Certificate once satisfied. Prospectus disclosure is governed by the Act, and listing on NEPSE after a public issue is mandatory. Failing to list is treated as a serious violation carrying financial penalties and restrictions on raising further capital.

Rights issues carry their own conditions, including a minimum period after listing of previously issued shares, and subscriptions are processed through SEBON’s ASBA (Applications Supported by Blocked Amount) system.

What We Do

• Transaction document review: prospectuses, underwriting agreements and related documentation for equity and debt transactions.
• Regulatory and statutory compliance for listed companies under the Securities Act and SEBON directives.
• SEBON registration and listing assistance through the full process.
• Contracts: issue management agreements, underwriting agreements and related documents.
• Rights issues and private placements, including the conditions and timing requirements SEBON attaches to each.

Our Approach

Capital markets transactions rarely stay confined to securities law. Our work routinely intersects with regulatory, restructuring, banking and finance matters, and we work alongside banks and international counsel to bring deals through to closure rather than handling isolated pieces of a larger transaction.