RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/ACC/SPEC/NPL/4  
7 July 2000 
 (00-2780) 
Working Party on the Accession  
of the Kingdom of Nepal Original:   English 
 
 
  
WORKING PARTY ON THE ACCESSION OF  
THE KINGDOM OF NEPAL  
 
Offer of Specific Commitments in Services
 
  
 The Government of the Kingdom of Nepal has submitted the attached Offer of Specific 
Commitments in Services and List of Article II MFN Exemptions with a request that it be circulated to 
members of the Working Party.  
 WT/ACC/SPEC/NPL/4 
Page 2 Offer of Specific Commitments on Services  
 
Modes of supply    (1) Cross-Border    (2) Consumption abroad    (3) Commercial Presence    (4) Presence of natural persons 
Sector or Sub-sector Limitations of Market Access Li mitations on National Treatment Additional Commitments 
I HORIZONTAL COMMITMENTS 
All Sectors included in this 
Schedule 1) and 2) In accordance with Foreign Exchange 
(Regulation) Act 1962 and Foreign Exchange Regulation Rules 1992, allocation of convertible 
currency for payment of foreign services 
suppliers subject to approval of Central Bank    
 3)  In accordance with the Foreign Investment 
and Technology Transfer Act, 1992,: 
 - All non-prohibited foreign investments 
outside the Financial Services Sector require 
approval by the Department of Industry. 
- Except where an environmental impact 
assessment is required, decisions of the 
Department are normally provided within 30 days of the date of application. 
- Investments of a type covered by the 
Environmental Protection Rules 1997, require an environmental impact assessment 
(EIA) or initial environmental assessment 
(IEA) (depending on the size and nature of the business) by the Ministry of Population 
and Environment.  
- Approval of an investment will not normally 
be withheld except for failure to meet 
environmental standards. 
- In no case would permission be denied for 
reasons described in XVI:2 of GATS. 
- A foreign investor making an investment in 
foreign currency shall be entitled to 
repatriate the following amount outside 
Nepal:- 
 a)  The amount received by the sale, in 3) A foreign investor reinvesting earnings is 
required to obtain the permission of the 
Department of Industry.  
 
  
 
  
 
  
 
  
 
  
 
 
 
  
 
    
  WT/ACC/SPEC/NPL/4
 Page 3Modes of supply    (1) Cross-Border    (2) Consumption abroad    (3) Commercial Presence    (4) Presence of natural persons 
Sector or Sub-sector Limitations of Market Access Li mitations on National Treatment Additional Commitments 
whole or part, of the investors share 
of equity; 
 b)  The amount received as profit or 
dividend as a result of an equity 
investment; 
 c)  The amount received as the payment 
of the principal of and interest on any 
foreign loan; and 
 d)  The amount received under an 
agreement to tran sfer technology 
approved by the Department of Industries or the Department of 
Cottage and Small Industries. 
 4) Unbound except for temporary  entry and stay 
of natural persons of another Member in the 
following category:  
Intra-corporate transferees
 
 Managers, executives and specialists as defined below who are employees of firms that 
provide services in Nepal through a branch, 
subsidiary or affiliate established in Nepal and who have been in the prior employment of their 
firm outside Nepal for a period of not less than 
one year immediately preceding the date of their application for admission and who fall with one 
of the following categories: 
(a) Executives and Managers
:  persons within 
an organization who primarily direct the 
organization or a department or sub-division of the organization, supervise or control the 
work of their supervisory, professional or 
managerial employees, have the authority to hire and fire or recomm end hiring, firing or 
other personnel actions (such as promotion,  
 
  
 
  
 
 
 
  
 
 
4) Selling and buying real estate is the 
constitutional right of every Nepalese 
citizen. The Civil Code prohibits anyone from selling, mortgaging,  gifting or 
endowing  or disposing any real property to 
a foreign individual, without prior permission of HMG which is given only in 
exceptional circumstances. 
  
 WT/ACC/SPEC/NPL/4 
Page 4 Modes of supply    (1) Cross-Border    (2) Consumption abroad    (3) Commercial Presence    (4) Presence of natural persons 
Sector or Sub-sector Limitations of Market Access Li mitations on National Treatment Additional Commitments 
or leave authorization) and exercise 
discretionary authority over day-to-day 
operations. 
(b)  Specialists : persons within an organization 
who possess technical knowledge at an 
advanced level of continued expertise and who possess propriety knowledge of the 
organization’s services, research techniques 
or management techniques. (Specialists may 
include but are not limited to members of 
licensed professions.)  
 Entry for the above-listed categories of 
intra-corporate transferees is limited to a 2 years 
initial period that may be extended for  up to 3 years for a total period not to exceed 5 years.  
II. SECTOR  SPECIFIC  COMMITMENTS 
1.   TELECOMMUNICATION SERVICES 
Basic Telecommunications    
(a) Local telephone service 
(b)  Domestic telephone service (c)  International telephone 
services 
(d)  Telex service (e) Domestic and international 
telegraph service 
 1) Unbound 
2) Unbound 3) None, except: 
 
- In accordance with the Telecommunications 
Act 1997 and Telecommunications 
Regulation, licence to operate any 
telecommunications service is issued by the Nepal Telecommunication Authority (NTA) 
- A licence will be issued to one extra service 
provider in addition to Nepal 
Telecommunications Corporation (NTC) 
subject to the following conditions:  
- Foreign participation permitted through a joint 
venture with up to 80%  equity participation.  
- Licence issued for an initial period of 10 
years. Renewable for additional 5 year periods 
up to a maximum of 25 years. 1) None 
2) None 3) None, except  
 
Land and equipment of a company with more than 50% foreign 
ownership reverts to HMG after 
expiry of licence. If foreign ownership is less than 50%, the 
Nepalese licensee may operate the 
service with a new licence. 
 
  
 
  
   
  WT/ACC/SPEC/NPL/4
 Page 5Modes of supply    (1) Cross-Border    (2) Consumption abroad    (3) Commercial Presence    (4) Presence of natural persons 
Sector or Sub-sector Limitations of Market Access Li mitations on National Treatment Additional Commitments 
- Licensee will be able to provide 
telecommunications services to its own 
customers through its own network by the end of 2001. 
- Licensee will be empowered to lease lines to 
other services providers and users by the end of 2001. 
- Terms of inter-connect between NTC and 
licensee to be negotiated subject (after six 
months) to final arbitration by Nepal 
Telecommunication Authority. 
- Licensee shall operate at least one public call 
office in each Village Development 
Committee district. 
- Licensee to invest prescribed fraction of total 
investment in the development, extension and 
operation of telecommunications services in rural areas.  
- Licensee shall create a fund for the 
development of rural communications and licensee shall deposit every year, out of its 
annual income,  prescribed fraction of total 
annual income specified  by the NTA into a 
fund for the development of rural 
communications. 
 4) Unbound except as indicated in the horizontal 
section  
 
  
 
  
 
 
 
  
 
  
 
  
 
  
 
  
 
 4) Unbound except as indicated 
under market access 
Mobile Telephone Service 1) Unbound 
2) Unbound 3) None, except:  
 
- In accordance with the Telecommunications 
Act 1997 and Telecommunications 
Regulation, licence to oper ate is issued by the 
Nepal Telecommunication Authority (NTA). 1) Unbound 
2) Unbound 3) None, except  
 
Land and equipment of a company with more than 50% foreign 
ownership reverts to HMG after 
expiry of licence. If foreign   
 WT/ACC/SPEC/NPL/4 
Page 6 Modes of supply    (1) Cross-Border    (2) Consumption abroad    (3) Commercial Presence    (4) Presence of natural persons 
Sector or Sub-sector Limitations of Market Access Li mitations on National Treatment Additional Commitments 
- Foreign participation permitted through a joint 
venture with up to 80%  equity participation.  
- Licence issued for an initial period of 10 
years. Renewable for additional 5 year periods 
up to a maximum of 25 years. 
- By 2004 two mobile operators will be 
licensed to operate Global Mobile System 
(GMS). One operator will be selected through 
bidding process. The other operator will be 
the Nepal Telecommuni cations Corporation 
that will operate its Mobile System under the same terms of service as the second operator. 
- Mobile operators will not be permitted to 
access international traffic, which will be reserved for fixed line operators. 
 
4) Unbound except as i ndicated in horizontal 
section ownership is less than 50%, the 
Nepalese licensee may operate the 
service with a new licence.  
 
  
 
 
 
  
 
  
 
4) Unbound except as indicated under market access 
Value-added telecommunications 
(a)  Internet including e-mail (b)  Email 
(c)  Voice mail 
(d)  Video text (e)  Fax mail 
(f)  VSAT 
(g)  Audio Conference (h)  Pay phone 
(I)  Pre-paid calling card 
(j)  Local data communication 
(k)  Radio paging 
(l)  Trunked mobile 1) Unbound 
2) Unbound 
3) None, except: 
 - In accordance with the Telecommunications 
Act 1997 and Telecommunications 
Regulation, licence to oper ate is issued by the 
Nepal Telecommunication Authority (NTA 
- Foreign participation permitted through a joint 
venture with up to 80%  equity participation.  
- Licence issued for an initial period of 10 
years. Renewable for additional 5 year periods up to a maximum of 25 years. 
- After 2004 VSAT operators will be permitted 
to provide data or voice services but not both. 
 
4) Unbound except as indicated in the horizontal 1) None 
2) None 
3) None, except: 
 Land and equipment of a company 
with more than 50% foreign 
ownership reverts to HMG after expiry of licence. If foreign 
ownership is less than 50%, the 
Nepalese licensee may operate the 
service with a new licence. 
  
 
  
4) Unbound except as indicated   
  WT/ACC/SPEC/NPL/4
 Page 7Modes of supply    (1) Cross-Border    (2) Consumption abroad    (3) Commercial Presence    (4) Presence of natural persons 
Sector or Sub-sector Limitations of Market Access Li mitations on National Treatment Additional Commitments 
section under market access 
2.  HEALTH RELATED AND SOCIAL SERVICES 
Hospital Services (CPC 9311) 1) Unbound* 
2) Unbound 
3) None 
4) Unbound except as indicated in the horizontal section 1) None 
2) None 
3) None 
4) Unbound except as indicated under market access  
3.  TOURISM AND TRAVEL RELATED SERVICES 
Hotels (star hotels ) 1) Unbound* 
2) None, except  
convertible currency limit on foreign tourist travel of US $700 per annum 
3) None 
4) Unbound except as indicated in the horizontal section 1) None 
2) None 
  
3) None 
4) Unbound except as indicated under market access  
 
* Unbound due to lack of technical feasibility.  
 WT/ACC/SPEC/NPL/4 
Page 8 List of Article II MFN Exemptions  
 
Sector or Sub-
Sector Description of measure indicating its 
inconsistency with Article II Countries to which the 
measure applies Intended Duration Conditions creating the need for the exemption 
All Sectors Allocation of non-convertible 
currency effected by commercial banks without involvement of 
Central Bank India Indefinite To facilitate border traffic and regional integration by providing for 
full current account conver tibility of  Nepalese rupees into Indian 
rupees 
Tourism Higher allocation of convertible 
currency for tr avel purposes 24 OECD countries. Indefinite To reflect higher board and lodging costs in countries mentioned 
Insurance Approval of application for 
establishment dependent on 
reciprocal treatment All countries Indefinite Promote  equitable treatment for Nepalese insurers seeking to 
establish abroad. 
 
 
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