chhatramani/nepal_legal_acts_corpus_english huggingface dataset:
Political Parties Act, 2017

16. Provisions Relating to Federal and Provincial Level Committees: (1) Elections for each office bearer in the Central Committee at the federal level and the Provincial Committee at the provincial level of the party shall be conducted at least once every five years as provided in the Statute of the party.

(2) Notwithstanding anything contained in Sub-section (1), if special circumstances arise and elections for such office bearers cannot be completed within five years, elections for such office bearers shall be held within six months from the date of expiry of that period, informing the Commission as provided in the Statute.

(3) Details of the elected Central Committee and Provincial Committee shall be provided to the Commission within one month from the date of election.

(4) The Commission may monitor whether the Central Committee and Provincial Committee of a party are formed in accordance with this Section. 17. Qualifications for Office Bearers of Central Committee and Provincial Committee: The qualifications required to be fulfilled by any member of the party to be elected as an office bearer of the Central Committee or Provincial Committee of the party shall be as specified in the Statute of the relevant party. 18. Disciplinary Action May Be Taken: (1) The party may take disciplinary action against a member or office bearer who acts contrary to the Statute or fails to comply with the code of conduct of the party, as provided in the Statute.

(2) While taking action under Sub-section (1), a reasonable opportunity to present a defense shall be given to that person.

(3) When the party takes action against any member under this Section, the reason and basis for such action must be clearly stated. 19. Provision for Mechanism to Hear Appeals: (1) The party shall provide in its Statute an appropriate mechanism to hear appeals against actions taken under Section 18.

(2) The mechanism under Sub-section (1) may confirm, annul, or modify the action taken under Section 18. Chapter-4
Functions, Duties and Rights of the Party

20.
Political Parties Act, 2017

Chapter-4
Functions, Duties and Rights of the Party

20. Functions, Duties and Rights of the Party: (1) The functions, duties, and rights of the party, subject to the Constitution, this Act, and prevailing law, shall be specified in the relevant Statute.

(2) Without prejudice to the generality of Sub-section (1), the party may, in particular, perform or cause to be performed the following functions:-

(a) Activities related to the strengthening of the competitive multi-party, federal democratic republican system,

(b) Presenting policies, plans, and programs of economic, social, or cultural development of the country before the public,

(c) Contributing to the development of an independent, self-reliant, and progressive national economy and a free and prosperous economy,

(d) Enhancing political awareness of the people as a representative catalyst of political or civic development,

(e) Developing a culture of inter-party consensus and coordination,

(f) Identifying the rights, interests, and concerns of citizens and making necessary efforts to exercise such rights and address interests and concerns,

(g) Contributing to the establishment of an egalitarian society by ending all forms of social discrimination, violence, untouchability, or prejudice,

(h) Taking necessary initiatives in the government or non-government sector to implement the right of citizens to good governance in practice, and assisting government mechanisms for that purpose,

(i) Performing or causing to be performed other necessary functions for the promotion, development, or strengthening of democracy,

(j) Enhancing social harmony and unity,

(k) Conducting or causing to be conducted programs that promote volunteerism, foster sovereignty, human rights, social justice, peace, and non-violence,

(l) Contributing to preparedness activities by conducting disaster risk reduction education campaigns,

(m) Providing search, rescue, assistance, reconstruction, and other necessary help during national disasters,

(n) Performing works mentioned in its election manifesto,

(o) Providing support to programs conducted by the Commission.

(3) To perform the functions, duties, or roles under Sub-section (1) or (2), the party may carry out the following activities:-

(a) Making its policies, programs, plans, or strategies public or publicizing them,

(b) Forming or causing to be formed organizations affiliated with it under prevailing law,

(c) Organizing peaceful processions, public meetings, or rallies as necessary to implement or cause to be implemented its policies, programs, or plans,

(d) Doing other necessary tasks to fulfill its objectives. 21.
Political Parties Act, 2017

21. Acts Prohibited for Party: A party shall not perform or cause to be performed any of the following acts:-

(a) Undermining the sovereignty, territorial integrity, nationality, and independence of Nepal,

(b) Spying or causing espionage against the nation,

(c) Breaching national confidentiality,

(d) Assisting any foreign state, organization, or representative in a manner detrimental to the security of Nepal,

(e) Committing treason,

(f) Undermining harmonious relations between federal units,

(g) Spreading ethnic or communal hatred or undermining harmonious relations among various castes, ethnic groups, religions, and sects,

(h) Imposing restrictions on Nepali citizens based on caste, language, religion, sect, or gender for obtaining party membership, or granting membership only to persons of a particular caste, language, religion, sect, or gender,

(i) Discriminating among citizens,

(j) Inciting violent acts,

(k) Performing acts contrary to public morality,

(l) Conducting processions, public meetings, or protests by displaying weapons such as khukuri, spear, or explosive substances, or sticks, lathis,

(m) Using or encroaching upon any government, public, or community property without prior approval of the authorized officer,

(n) Causing or causing to cause vandalism, damage, or destruction to government, public, community, or private property,

(o) Disrupting the provision of public services in a manner causing inconvenience to the general public,

(p) Using children in political activities,

(q) Performing or causing to be performed any other act that a party is prohibited from doing under prevailing law. 22. Compliance with Directions and Code of Conduct Required: The party, its office bearers, and members shall comply with the directions and election code of conduct issued by the Commission. 23. May Participate in Election: A party may participate in elections subject to the Constitution, this Act, and prevailing law. Chapter-5
Parliamentary Party

24. Formation of Parliamentary Party: (1) A party that wins at least two seats representing it in an election to the Federal Parliament or Provincial Assembly may form a Federal Parliamentary Party or Provincial Parliamentary Party.

(2) Every person elected from a party under Sub-section (1) and representing it in the Federal Parliament or Provincial Assembly shall automatically be a member of the relevant parliamentary party.

(3) For the purpose of Sub-section (1), the relevant party shall provide the following details in the format specified by the Secretariat of the Federal Parliament or the Secretariat of the Provincial Assembly to such Secretariat:-

(a) Name of the relevant party and details of its central office,

(b) One copy of the Statute of the relevant party, and one copy of its Rules, if any,

(c) One copy of the separate Statute of the parliamentary party of the relevant party, if any,

(d) Number and names of the elected representatives. 25.
Political Parties Act, 2017

25. Leader of Parliamentary Party: (1) The members of the parliamentary party in the Federal Parliament or Provincial Assembly shall, in accordance with the direction of the relevant party, elect one of themselves as the Leader of the Parliamentary Party.

(2) The election of the parliamentary party leader and other matters relating thereto shall be as specified in the Statute of the relevant party. 26. Office Bearers of Parliamentary Party: (1) In addition to the leader of such party, the parliamentary party shall have a Deputy Leader, Whip, or Member-Secretary as required.

(2) Unless otherwise provided in the Statute of the relevant party, the Leader of the Parliamentary Party shall nominate the Deputy Leader, Whip, or Member-Secretary from among the members of the parliamentary party.

(3) The Leader or Whip of the Parliamentary Party shall provide the details of the office bearers of the parliamentary party to the Secretariat of the Federal Parliament or the Secretariat of the Provincial Assembly. 27. Office of Parliamentary Party: (1) The Secretariat of the Federal Parliament or the Secretariat of the Provincial Assembly shall make necessary arrangements to establish an office for the conduct of the activities of the parliamentary party.

(2) For the purpose of Sub-section (1), such Secretariat shall provide necessary resources and means to the relevant parliamentary party. 28. May Issue Direction to Members: (1) The Whip of such party may, in accordance with the direction of the Leader of the Parliamentary Party, issue a direction (Whip) to the members of the parliamentary party to vote in favor or against a proposal in a House of the Federal Parliament or the Provincial Assembly on the following proposals:-

(a) Motion of confidence or no-confidence in the Government,

(b) Subject of approving the policies and programs of the Government,

(c) Subject of passing the annual budget,

(d) Any other subject of national or public importance.

(2) Every member of the parliamentary party must comply with the direction under Sub-section (1).

(3) The Whip shall provide details of the member who fails to comply with the direction under Sub-section (1) to the Central Committee of the relevant party. 29. Becoming Member of Parliamentary Party: If a person who is elected to the Federal Parliament or Provincial Assembly independently without being a candidate of any party acquires membership of a party, such person shall automatically become a member of the parliamentary party of that party. Chapter-6
Party Defection

30. May Defect from Party: (1) A member of a party may defect from the party at any time.

(2) Provisions relating to defection under Sub-section (1) shall be as per the Statute of the relevant party. 31.
Political Parties Act, 2017

Chapter-6
Party Defection

30. May Defect from Party: (1) A member of a party may defect from the party at any time.

(2) Provisions relating to defection under Sub-section (1) shall be as per the Statute of the relevant party. 31. Defection Not Allowed: (1) Notwithstanding anything contained in Section 30, a member of the Federal Parliament, a member of the Provincial Assembly, or a member of a local level, who is elected as a candidate from a party, shall not be allowed to defect from that party during the term of office of such position.

(2) If a member defects from the party contrary to Sub-section (1), the position to which he/she was elected shall be deemed vacant automatically from the date of defection. 32. Deemed to Have Defected from Party: (1) A member shall be deemed to have defected from the party in the following circumstances:-

(a) If he/she resigns in writing from the membership of the relevant party,

(b) If he/she acquires membership of another party, or

(c) If he/she forms another party, either independently or with his/her involvement.

(2) Upon receiving details under Sub-section (3) of Section 28, the Central Committee of the relevant party may expel such member from the relevant party under this Section, and if a member is expelled accordingly, such member shall be deemed to be expelled from the relevant party as well.

(3) Before expelling under Sub-section (2), the Central Committee of the relevant party shall give such member a reasonable opportunity to present his/her defense, and for that purpose, the relevant party may form an investigation committee.

(4) Upon receiving the defense under Sub-section (3), the Central Committee of the relevant party shall decide whether the defense presented by such member is satisfactory or not.

(5) If the defense presented under Sub-section (3) is not satisfactory, the Central Committee of the relevant party may, as provided in the Statute, expel such member from the party membership, stating the reasons and basis. 33.
Political Parties Act, 2017

33. Not Deemed to Have Defected from Party: (1) Notwithstanding anything contained elsewhere in this Chapter, a member shall not be deemed to have defected from the party in the following circumstances:-

(a) If a member submits a written resignation from the membership of the relevant party citing the reason of being elected as the Speaker or Deputy Speaker of the House of Representatives, Chairperson or Vice-Chairperson of the National Assembly, or Speaker or Deputy Speaker of the Provincial Assembly,

(b) If an office bearer as per clause (a) votes against, remains neutral, or is absent from a direction (Whip) issued by the Whip,

(c) If any member other than the office bearer as per clause (a) presides over a House of the Federal Parliament or the Provincial Assembly, and while presiding, votes against or remains neutral from the direction issued by the Whip,

(d) If he/she becomes a member of a party that has unified or merged pursuant to Section 10. Amended by the Political Party Related (Second Amendment) Ordinance, 2077, revived by the Act Repealing Certain Ordinances and Substituting the Ordinance Made to Revive the Previous Provision of the Nepal Act, 2077, effective from 2077.1.12.(2) If at least forty percent of the members of the Central Committee and the parliamentary party in the Federal Parliament of a party form a separate new party, or enter another party, or form a new party including such members, the members of such parliamentary party shall not be deemed to have defected.

(3) Notwithstanding anything contained elsewhere in this Section, a separate party shall not be formed by defecting from a party formed under Sub-section (2) until five years from the date such party formed under Sub-section (2) obtains recognition from the Commission. 34. Notice of Defection to be Given: (1) If a member of a party who is also a member of the Federal Parliament or Provincial Assembly defects under this Act, or is expelled from the party, the relevant parliamentary party shall give notice along with the decision thereof to the Secretariat of the relevant House or Assembly.

(2) After receiving notice under Sub-section (1), the Secretariat of the Federal Parliament or Provincial Assembly shall submit such notice to the Speaker or Chairperson of the relevant House or Assembly. 35.
Political Parties Act, 2017

35. Information to be Given to the House: (1) After receiving notice under Section 34, the Speaker or Chairperson of the relevant House or Assembly shall inform the relevant House or Assembly of such notice within fifteen days from the date of registration of such notice.

(2) Notwithstanding anything contained in Sub-section (1), if the session of the Federal Parliament or Provincial Assembly is not ongoing, such notice shall be posted on the notice board of the relevant Secretariat, and after the session of the Federal Parliament or Provincial Assembly convenes, such details shall be informed to the relevant House or Assembly. 36. Position to Become Vacant: (1) After the Speaker or Chairperson of the relevant House or Assembly informs the relevant House or Assembly of the notice under Section 35, or after it is posted on the notice board of the relevant Secretariat, the position of such member shall be deemed vacant.

(2) The relevant Secretariat shall inform the Commission of the vacancy of a member's position under this Act within fifteen days. Chapter-7
Fund of the Party and its Operation

37. Fund of the Party: (1) The party shall have a separate Fund.

(2) The following amounts shall be deposited in the Fund:-

(a) Amount received from each member as membership fee or membership renewal fee pursuant to the Statute,

(b) Voluntary financial contribution received pursuant to Section 38,

(c) Amount collected by the party by organizing any program,

(d) Amount received from the sale of the party's publications and movable and immovable property,

(e) Interest amount received from the bank on the amount in the Fund,

(f) Contribution amount regularly received from members pursuant to the Statute.

(3) The amount deposited in the Fund shall be deposited by opening an account in a bank.

(4) All expenses incurred in the name of the party shall be borne from the Fund. 38.
Political Parties Act, 2017

38. Voluntary Financial Contribution May Be Accepted: (1) A Nepali citizen or corporate body may make a voluntary financial contribution to a party.

(2) A party shall not accept financial contributions from the following government offices, institutions, or persons:-

(a) Any agency or office of the Government of Nepal, Provincial Government, or Local Level,

(b) Corporate body wholly or partially owned or controlled by the Government of Nepal, Provincial Government, or Local Level,

(c) Public limited company having shares of the general public,

(d) Any government or community university, campus, school, or academic or educational institution,

(e) National and international non-governmental organizations,

(f) Foreign government, institution, or person,

(g) Anonymous person or institution,

(h) Other institutions prescribed by the Commission.

(3) When a party receives a financial contribution exceeding twenty-five thousand rupees from any person or corporate body under this Section, it shall be done only through a banking check or bank transfer.

(4) The party shall issue a receipt for all financial contributions received under this Section.

(5) While providing a financial contribution under this Section, it shall not be provided on the condition of obtaining any financial or personal benefit from the party, and the party shall not accept a contribution with a view to providing such benefit.

(6) When taking a contribution exceeding the amount as prescribed, the party must require the source to be disclosed.

(7) Other provisions relating to financial contributions shall be as prescribed. 39. Inquiry to be Conducted: (1) If a complaint with evidence is filed, or information is received from any other source, that a party has received a voluntary financial contribution that it is not allowed to accept under this Act, or if there are reasonable grounds to believe that a party has received such amount, the Commission shall conduct an inquiry as prescribed in that regard.

(2) If, from the inquiry conducted under Sub-section (1), it appears that the party has received such amount, the Commission shall order the relevant political party to deposit such amount with the Commission.

(3) The relevant party shall deposit such amount with the Commission within thirty days of receiving the order under Sub-section (2), and the Commission shall deposit the amount so received in the Consolidated Fund within fifteen days.

(4) If the party fails to deposit the amount within the period under Sub-section (3), the Commission may recover such amount from that party and impose a fine of ten thousand rupees. Chapter-8
Accounts and Audit

40.
Political Parties Act, 2017

Chapter-8
Accounts and Audit

40. Accounts to be Kept: (1) The party shall keep accounts showing the actual financial transactions of its income and expenditure, and such accounts may also be kept in electronic records.

(2) For the purpose of keeping records under Sub-section (1), the party shall designate a responsible office bearer and inform the Commission thereof.

(3) For the purpose of Sub-section (1), the Commission shall prescribe the format of the accounts.

(4) An authorized officer or expert designated by the Commission may request or inspect the accounts, books, and financial records of the party at any time.

(5) If requested or if inspection is desired under Sub-section (4), the relevant party shall provide the details thereof or allow inspection. 41. Audit to be Conducted: (1) The party shall, within six months of the end of the fiscal year, have its income and expenditure accounts audited by an auditor licensed under law, and submit the audit report to the Commission within one month.

(2) The audit report under Sub-section (1) shall include details as prescribed.

(3) Within forty-five days of the expiry of the period under Sub-section (1), the Commission may issue an order, in writing or through electronic or other means of communication, to such party to submit an explanation stating the reason for not submitting the audit report.

(4) The relevant party shall submit an explanation within the period under Sub-section (1).

(5) The audit report under Sub-section (1) must be made public by the party within one month from the date of submission to the Commission. 42. Audit Report May be Examined: (1) After receiving the audit report under Section 41, the Commission may have it examined as prescribed.

(2) For the purpose of Sub-section (1), the Commission or an officer designated by the Commission may request any details or documents from the relevant party, and it shall be the duty of the relevant party to submit such details or documents within the prescribed period. Chapter-9
Resolution of Disputes Relating to Party Recognition

43. Resolution of Disputes: If a dispute arises between two or more parties Added by the Act Amending Some Nepal Acts, 2075.or between two or more factions within the same party on the following matters, such dispute shall be resolved by the Commission:-

(a) Name of the party,

(b) Seal, Statute, flag,

(4) If a member of a parliamentary party under sub-section (3) commits an act contrary to sub-section (1) of Section 28, such member shall be deemed to have abandoned the party. 50.
Political Parties Act, 2017

50. Party Registration Book to be maintained: (1) For the purpose of maintaining records of details relating to a party, a party registration book shall be kept at the Commission and at the office designated by the Commission, and such registration book may also be kept in electronic medium.

(2) The record under sub-section (1) shall be certified by the officer as prescribed.

(3) Other provisions relating to the party registration book shall be as prescribed. 51. Information to be furnished: (1) A party shall furnish to the Commission, within thirty days, information regarding any change or amendment in its name, constitution, rules, seal, flag or symbol, changes in office bearers, and other matters as prescribed by the Commission.

(2) After receiving the information under sub-section (1), upon conducting necessary study and inquiry in relation thereto, if it is found that such work or action has been done in accordance with the Constitution, this Act, or the rules made under this Act, and the party's constitution, the Commission shall, in the case of the name, constitution, rules, seal, flag or symbol, maintain a record thereof, and if there has been a change in office bearers, it shall be updated as prescribed.

(3) If the information given under sub-section (1) relates to a change in office bearers, the Commission shall make the corresponding change in the details of the concerned party in the party registration book and update it accordingly. 52. Recognition as a national party: Only a party that obtains at least three percent of the votes in the proportional electoral system and one seat in the first-past-the-post electoral system in the election to the House of Representatives shall obtain recognition as a national party. Where a restrictive phrase was added by the Political Party (Second Amendment) Ordinance, 2077, it became ineffective from the date 2077/01/12 by the Ordinance made to repeal certain ordinances and revive the original provisions of the Nepal Act, replaced by the Act, 2077. 53. Property details to be submitted: (1) A person elected as an office bearer or member of the central committee shall, within sixty days of being elected, submit a sealed statement of his/her movable and immovable property to the central office of the party.
Political Parties Act, 2017

55. Code of Conduct: (1) A party shall, subject to the Constitution, this Act, and the rules made under this Act, and the party's constitution, formulate and implement a code of conduct to be followed by its party, office bearers, members, and workers.

(2) The party shall inform the Commission of the passing of the code of conduct under sub-section (1).

(3) The code of conduct under sub-section (1) shall be followed by the concerned party, office bearers, members, and workers.

(4) An office bearer, member, or worker who fails to follow the code of conduct under sub-section (2) shall be subject to action in accordance with the party's constitution. 56. Information to be given to local administration: If a party intends to hold a meeting, rally, or procession, it shall give information thereof to the concerned local administration at least seventy-two hours before holding such meeting, rally, or procession. 57. May issue directives: (1) The Commission may, subject to the Constitution and prevailing law, issue necessary directives in relation to matters to be followed by a party while conducting its work and proceedings.

(2) It shall be the duty of every party to comply with the directives under sub-section (1). 58. May lodge complaint for compensation: (1) If any party causes or causes to be caused damage or loss to any government, community, public, or private property, the owner of the private property, and in the case of public or government property, the prescribed officer, may, within forty-five days from the date of such damage or loss, claim compensation therefor and lodge a complaint in the concerned District Court.

(2) When deciding on a complaint lodged under sub-section (1), the concerned Court shall order the payment of reasonable compensation for such loss.

(3) The liability to pay compensation under sub-section (2) shall be of the chief office bearer of the party.

(4) A party dissatisfied with the decision under sub-section (2) may appeal to the concerned High Court by depositing as security the amount of compensation to be paid. 59. Contact person to be designated: For the purpose of liaison with the Commission, a party shall designate one contact person and inform the Commission thereof. 60. May make rules: The Commission may make necessary rules for the implementation of this Act. 61. May make directives or procedures: (1) The Commission may, subject to this Act and the rules made under this Act, make necessary directives or procedures.

(2) The directives or procedures under sub-section (1) shall be followed by all concerned. 62.
Political Parties Act, 2017

61. May make directives or procedures: (1) The Commission may, subject to this Act and the rules made under this Act, make necessary directives or procedures.

(2) The directives or procedures under sub-section (1) shall be followed by all concerned. 62. Repeal and saving: (1) The following Acts are hereby repealed:—

(a) The Defection Act, 2054,
(b) The Political Party Related Act, 2058.

(2) The acts and actions done under the Acts repealed under sub-section (1) shall be deemed to have been done under this Act. Schedule
(Relating to sub-section (2) of Section 8)

Matters to be included in the Constitution of a Political Party

1. Full name of the party, and if there is an abbreviated name, such name,
2. Location of the central office of the party,
3. Details regarding the seal, symbol, or flag of the party,
4. Objectives and program of the party,
5. Conditions for acquiring and losing membership of the party,
6. Organizational structure of the party,
7. Details of office bearers of the central committee, provincial committee, and at the local level of the party,
8. Provisions relating to the election and nomination of office bearers of the central committee, provincial committee, and at the local level of the party,
9. Provisions relating to the general convention,
10. Meeting of various committees or units of the party, and the procedure for calling meetings and making decisions,
11. Disciplinary action that may be taken against members or office bearers,
12. Mechanism for hearing appeals,
13. Fund of the party, financial management, and the office bearer responsible therefor,
14. Procedure relating to the nomination of candidates,
15. Provisions relating to accounts, audit, and audit committee,
16. Process for involving members or lower bodies in policy and program formulation,
17. Procedure for amending the party's constitution,
18. Circumstances for dissolution of the party and management of assets and liabilities upon dissolution,
19. Proportionate inclusive provisions to be made in various committees of the party,
20. Power to make regulations,
21. Provisions for issuing internal circulars,
22. Provisions relating to party membership and renewal fees,
23. Provisions relating to the party membership registration book,
24. Other necessary matters.
Nepal Rastra Bank Act, 2002

Nepal Rastra Bank Act, 2058 (2002)

Date of Royal Seal and Publication
2058.10.17

Amending Acts

1. Nepal Rastra Bank (First Amendment) Act, 2063 (2007) 2063.7.23
2. Republic Strengthening and Some Nepal Laws Amendment Act, 2066 (2010) 2066.10.7
3. Some Nepal Acts Amendment Act, 2072 (2016) 2072.11.13
4. Nepal Rastra Bank (Second Amendment) Act, 2073 (2016) 2073.7.29
5. Some Nepal Laws Amendment, Consolidation, Adjustment and Repeal Act, 2074 (2018) 2074.6.30
6. Payment and Settlement Act, 2075 (2019) 2075.12.4
7. Some Nepal Acts Relating to the Civil Code Amendment Act, 2075 (2019) 2076.1.2
8. Act to Amend Some Acts relating to Prevention of Money Laundering and Promotion of Business Environment, 2080 (2024) 2080.12.30
9. Act to Amend Some Nepal Acts relating to Cooperatives, 2081 (2025) 2081.12.18

Act No. 15 of the year 2058 (2002)



An Act Made to Establish Nepal Rastra Bank to Function as a Central Bank

Preamble: Whereas, it is expedient to establish Nepal Rastra Bank as a central bank to maintain price and balance of payments stability and overall financial sector stability in such a way as to support the sustainable development of the economy of Nepal Removed by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066. Amended by the Second Amendment.;

Therefore, this Act is enacted by Parliament in the first year of the reign of His Majesty King Gyanendra Bir Bikram Shah Dev. Chapter 1

Preliminary

1. Short Title and Commencement: (1) This Act may be called the "Nepal Rastra Bank Act, 2058 (2002)."

(2) This Act shall come into force immediately. 2.
Nepal Rastra Bank Act, 2002

Added by the Second Amendment.(ac) "Court" means the Commercial Bench of the High Court designated by the Government of Nepal, after consultation with the Supreme Court, by publishing a notice in the Nepal Gazette. Added by the Second Amendment.(ad) "Special Administration Group" means the Special Administration Group constituted pursuant to Section 88Ka.

(ae) "Prescribed or as Prescribed" means prescribed or as prescribed in the rules or regulations made under this Act. Chapter 2

Establishment, Objectives and Functions, Duties and Powers

3. Establishment of the Bank: (1) A central bank named "Nepal Rastra Bank" is hereby established to perform the functions of a central bank.

(2) The Nepal Rastra Bank established under the Nepal Rastra Bank Act, 2012 (1956) shall be deemed to have been established under this Act.

(3) The Bank shall be a self-governing and corporate body with perpetual succession.

(4) The Bank shall have its own separate seal for its business.

(5) The Bank may, subject to this Act, acquire, use, hold, sell or otherwise deal with movable and immovable property.

(6) The Bank may sue and be sued in its own name.

(7) The head office of the Bank shall be in Kathmandu, and the Bank may, as required, open branches, sub-branches and other offices, and appoint agents or representatives in any place within or outside Nepal Removed by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066.. 4. Objectives of the Bank: (1) The objectives of the Bank shall be as follows:

(a) Amended by the Second Amendment. To formulate and manage necessary monetary and foreign exchange policies to maintain price and balance of payments stability for financial stability and sustainable development of the economy;

(b) Amended by the Second Amendment. To enhance access to financial services and maintain stability of the banking and financial sector, thereby enhancing public confidence in the banking and financial system;

(c) To develop a safe, sound and efficient payment system;

(d) Removed by the Second Amendment.

(e) Removed by the Second Amendment.

(2) The Bank shall assist the Government of Nepal in implementing its economic policies without adversely affecting the objectives set forth in sub-section (1). 5.
Nepal Rastra Bank Act, 2002

5. Functions, Duties and Powers of the Bank: (1) For the purpose of achieving the objectives set forth in Section 4, the functions, duties and powers of the Bank shall be as follows:

(a) To issue bank notes and coins;

(b) To formulate necessary monetary policy to maintain price stability and to implement or cause to implement such policy;

(c) To formulate foreign exchange policy and to implement or cause to implement such policy;

(d) To determine the exchange rate system;

(e) To manage and operate foreign exchange reserves;

(f) To issue licenses to commercial banks and financial institutions to conduct banking and financial transactions, and to carry out necessary regulation, inspection, supervision and monitoring in relation to such transactions;

Added by the Act to Amend Some Acts relating to Prevention of Money Laundering and Promotion of Business Environment, 2080.(f1) To issue directives and standards relating to regulation, inspection and supervision of cooperative institutions conducting savings and loan transactions;

Added by the Act to Amend Some Acts relating to Prevention of Money Laundering and Promotion of Business Environment, 2080.(f2) To regulate, inspect and supervise cooperative institutions having a share capital exceeding fifty crore rupees or an annual turnover equivalent to that amount, based on financial governance and risk, at the request of the Department of Cooperatives, also exercising powers under the prevailing cooperative law;

(g) To act as the banker, advisor and financial agent of the Government of Nepal;

(h) To act as the bank and lender of last resort for commercial banks and financial institutions;

(i) To establish, promote and regulate payment, clearing and settlement systems; and

Added by the Second Amendment.(i1) To conduct open market operations through necessary instruments for liquidity management;

(j) To implement or cause to implement other necessary functions required to be performed by the Bank to achieve its objectives under this Act.

(2) The Bank shall have the power to perform such other functions and acts as may be necessary in exercising the powers conferred by this Act or other prevailing laws.

(3) No person shall encroach upon the powers acquired by the Bank under this Act. 6.
Nepal Rastra Bank Act, 2002

6. Priority Right of the Bank: (1) The Bank shall have a priority right to secure its claim over cash deposited in the account of the debtor with the Bank or any commercial bank or financial institution, or over any other kind of movable or immovable property in the name of such debtor, for the purpose of recovering loans provided by the Bank to the debtor or any other claim of the Bank.

(2) The Bank shall take possession of the cash or movable or immovable property over which it has a priority right under sub-section (1), sell it as prescribed, and recover its loan from the proceeds thereof. 7. Prohibited Activities of the Bank: (1) Except as provided in this Act, the Bank shall not engage in the following activities:

(a) Granting any loan, accepting any kind of deposit, or giving any kind of financial gift;

(b) Purchasing shares of any commercial bank, financial institution, public corporation or company, or acquiring any ownership rights in any financial, commercial, agricultural, industrial or other institution in any manner;

(c) Engaging in any kind of trading; or

(d) Acquiring rights over movable or immovable property by purchase, lease or any other means. Provided, however, that the Bank may acquire property necessary for conducting its business and management or fulfilling its objectives.

(2) Notwithstanding anything contained in sub-section (1), the Bank may engage in the following activities:

(a) Providing loans not exceeding ten percent of the total capital of an institution that engages in functions assisting the Bank in carrying out its own functions or fulfilling its liabilities, or acquiring ownership in shares of such institutions. Explanation: For the purpose of this clause, "institution that engages in functions assisting the Bank in carrying out its own functions or fulfilling its liabilities" means any institution or company designated by the Bank, including those purely involved in valuation, operation and protection of collateral of commercial banks or financial institutions, restructuring and transfer of collateral, credit rating, exchange of credit information, data processing and transmission, printing of financial instruments, payment clearing, asset securitization, production of bank notes or coins, acting as a trustee, or any other similar functions.

(b) The Bank may provide loans to its employees. 8.
Nepal Rastra Bank Act, 2002

8. Exemptions and Facilities to the Bank: Notwithstanding anything contained in the prevailing law, the Bank shall have the following exemptions and facilities:

(a) Exemption from all kinds of taxes, fees, levies, etc. on the income, capital transactions, houses, land, property and assets of the Bank.

(b) No registration fee shall be charged for registering instruments of loans or refinancing provided by the Bank.

(c) No revenue stamp shall be required to be affixed on any instrument relating to the Bank.

(d) No tax, fee, duty or levy of any kind shall be imposed on the import and export of notes, coins, gold, silver, and paper, metals, chemicals and other materials used for minting. 9. Relationship between the Government of Nepal and the Bank: Any relationship between the Government of Nepal and the Bank under this Act shall be maintained through the Ministry of Finance. 10. Coordination with Public Bodies: (1) For the attainment of its objectives, the Bank shall make necessary coordination with public bodies or their agencies or entities.

(2) Upon request of the Government of Nepal, the Bank shall provide necessary information on balance of payments and banking and financial matters.

(3) Upon request of the Bank, the Government of Nepal, public bodies and the private sector shall provide necessary information to the Bank on economic and financial matters. 11. International Cooperation and Relations: (1) The Bank shall represent Nepal Removed by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066. in international associations and organizations concerning monetary policy, foreign exchange policy, balance of payments, bank supervision and other related subjects falling within its jurisdiction.

(2) The Bank may provide banking and payment services to foreign governments, foreign central banks, foreign banks and international associations and organizations, and may also avail itself of similar facilities from them.

(3) The Bank shall participate in international associations and organizations working to achieve financial and economic stability through international monetary cooperation.

(4) In participating in international associations and organizations as the representative of Nepal Removed by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066., the Bank shall assume the responsibilities and duties that Nepal must bear and perform. 12. Dissemination of Public Information: The Bank shall regularly publish and disseminate publicly information about its statistical analysis on subjects such as macroeconomic conditions, development of financial markets, money supply, price stability, credit expansion, balance of payments and foreign exchange. 13. Operation of Accounts: The Bank may open and operate accounts for the Government of Nepal, other government bodies, commercial banks and financial institutions, public corporations, foreign missions, foreign central banks, foreign banks, and international associations and organizations.
Nepal Rastra Bank Act, 2002

13. Operation of Accounts: The Bank may open and operate accounts for the Government of Nepal, other government bodies, commercial banks and financial institutions, public corporations, foreign missions, foreign central banks, foreign banks, and international associations and organizations. The procedure for opening and operating such accounts shall be as prescribed by the Bank. Provided, however, that the Bank shall not operate accounts for any individual, industry or political party. Chapter 3

Constitution and Functions, Duties and Powers of the Board

14. Constitution of the Board of Directors: There shall be a Board of Directors of the Bank consisting of the following members:

(a) Governor - Chairperson
(b) Secretary, Ministry of Finance - Member
(c) Two Deputy Governors - Member
(d) Three Directors appointed by the Government of Nepal from among distinguished persons in the fields of economics, monetary, banking, finance, and commercial law - Member

15. Appointment of Governor: (1) The Government of Nepal, the Council of Ministers, shall appoint the Governor on the recommendation of the Recommendation Committee constituted pursuant to sub-section (2).

(2) The Government of Nepal, the Council of Ministers, shall constitute a Recommendation Committee as follows for the appointment of the Governor:

(a) Minister of Finance - Chairperson
(b) One person from among former Governors - Member
(c) One person designated by the Government of Nepal from among distinguished persons in the fields of economics, monetary, banking, finance and commercial law - Member

(3) While recommending for the appointment of the Governor, the Committee constituted pursuant to sub-section (2) shall recommend a list of three names to the Government of Nepal, the Council of Ministers, from among distinguished persons in the fields of economics, monetary, banking, finance, commerce, management and commercial law, as well as from among Deputy Governors.

(4) The Government of Nepal, the Council of Ministers, shall appoint one person from among the names recommended pursuant to sub-section (3) to the post of Governor. 16. Appointment of Deputy Governor: (1) The Government of Nepal, the Council of Ministers, shall appoint the Deputy Governor on the recommendation of the Governor.

(2) While recommending for appointment to the post of Deputy Governor under sub-section (1), the Governor shall recommend twice the number of vacant posts from among the officers of special class of the Bank on the basis of work performance.

(3) A person appointed to the post of Deputy Governor under this section shall be deemed to have automatically retired from the service of the Bank. 17.
Nepal Rastra Bank Act, 2002

17. Appointment of Directors: (1) The Government of Nepal, the Council of Ministers, shall appoint Directors.

(2) While appointing Directors under sub-section (1), the Government of Nepal, the Council of Ministers, shall do so ensuring representation from different fields among distinguished persons in the fields of economics, monetary, banking, finance, commerce, management and commercial law. 18. Term of Office of Directors: (1) The term of office of the Governor, Deputy Governor and Directors shall be five years.

(2) The Government of Nepal may, if deemed appropriate, re-appoint a Governor whose term has expired for one further term, and re-appoint a Director for any number of further terms. 19. Remuneration and Other Facilities of Directors: The remuneration and other facilities of the Governor, Deputy Governor and Directors shall be as determined by the Board. 20. Qualification of Directors: A person shall possess the following qualifications for appointment to the post of Governor, Deputy Governor or Director:

(a) Being a citizen of Nepal,
(b) Having high moral character,
(c) Having obtained at least a master's degree in economics, monetary, banking, finance, commerce, management, public administration, statistics, mathematics Amended by the First Amendment. or law, and having acquired work experience in the fields of economics, monetary, banking, finance Amended by the First Amendment. or commercial law. Explanation: For the purpose of this clause, "work experience" means work experience gained while working in a special class post in the Government of Nepal or the Bank, or as a professor at a university, or as the executive head of a class "A" commercial bank or financial institution, or in an executive level post in an international association or organization, or in a post equivalent to or higher in rank than the aforementioned posts.

(d) Not being disqualified under Section 21. 21. Disqualification of Directors: The following persons shall not be qualified for appointment to the post of Governor, Deputy Governor or Director:

(a) A member or office bearer of a political party, or
(b) A person who has been blacklisted in any transaction of a commercial bank or financial institution, or
(c) A sitting office bearer of a commercial bank or financial institution, or
(d) A person holding five percent or more shares or voting rights in a commercial bank or financial institution, or
(e) A person who has been declared insolvent due to inability to repay debts, or
(f) A person of unsound mind, or
(g) A person who has been convicted by a court of a criminal offense involving moral turpitude. 22.
Nepal Rastra Bank Act, 2002

22. Circumstances for Removal of Directors: (1) The Government of Nepal, the Council of Ministers, shall remove the Governor, Deputy Governor or Director who falls under the circumstances for removal as per sub-section (5). Provided, however, that before such removal, the Government of Nepal shall not deprive the concerned person of a reasonable opportunity to submit their defense.

(2) The Government of Nepal shall remove the Governor under sub-section (1) on the recommendation of the Investigation Committee constituted pursuant to Section 23.

(3) The Government of Nepal shall remove a Director or Deputy Governor under sub-section (1) on the basis of the recommendation submitted by the Board after conducting an inquiry.

(4) Upon the initiation of the removal process of the Governor, Deputy Governor or Director under sub-section (1), they shall be deemed to be automatically suspended from their post.

(5) The Governor, Deputy Governor or Director shall be removed in any of the following circumstances:

(a) If they become disqualified to be a Director under Section 21, or
(b) If there is a lack of competence to implement or cause to implement the functions required to be performed by the Bank for achieving its objectives under this Act, or
(c) If they are found to have engaged in acts detrimental to the banking and financial system of the country, or
(d) If they are found to have acted dishonestly or in bad faith in the operations of the Bank, or
(e) If, due to misconduct, they have been disqualified from practicing any profession or business, have had their certificate revoked, or have been prohibited from carrying on business, or
(f) If they have been absent from more than three consecutive meetings of the Board without a reasonable cause.

(6) The Governor, Deputy Governor or Director shall not be removed for any reason other than those mentioned in sub-section (5). 23.