International Financial Transactions Act, 1998

3. License required: An international financial institution desiring to conduct international financial transactions shall obtain a license from the Implementation Committee under section 14. 4. Financial institutions eligible to obtain license: (1) Only the following financial institutions may obtain a license to conduct international financial transactions pursuant to this Act:-

(a) Foreign banks and trust companies;

(b) International insurance and reinsurance companies;

(c) Companies acting as a representative office of foreign companies;

(d) Foreign holding investment companies;

(e) Administrative or regional offices established by foreign financial companies;

(f) International trading companies;

(g) International financial companies;

(h) Foreign real estate holding companies;

(i) Foreign patent and royalty companies;

(j) Foreign mutual funds;

(k) International leasing companies;

(l) International merchant banks;

(m) Bodies such as foreign partnerships and trusts established as organized entities;

(n) Companies conducting international sales transactions;

(o) Foreign bodies authorized to operate non-resident pension and deferred bonus schemes;

(p) International financial companies providing financial services such as securities brokers, underwriters, investment advisers, pension fund advisers.

(2) Notwithstanding anything contained in subsection (1), in order to obtain a license under this Act, such financial institution shall be registered under the law of a country outside Nepal Deleted by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066. and shall have been engaged in international financial transactions for at least three years.

(3) The Government of Nepal may, on the recommendation of the Promotion Committee, by notification in the Nepal Gazette, make such changes, additions or deletions as necessary to the financial institutions mentioned in subsection (1). 5. Acts not to be done by international financial institution: An international financial institution shall not do the following acts:-

(a) Purchase or otherwise acquire in its name any immovable property within Nepal Deleted by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066.;

(b) Conduct any type of international financial transaction with a person resident in Nepal;

(c) Purchase shares or debentures of any company established in Nepal pursuant to the prevailing law;

(d) Open an account with a commercial bank situated in Nepal Deleted by the Republic Strengthening and Some Nepal Laws Amendment Act, 2066.. Provided that, with the approval of the Implementation Committee, it may open an account in any commercial bank up to the limit of the amount specified by the Implementation Committee for the purpose of carrying out its daily office administration. 6. No restriction on bringing foreign currency: (1) No restriction of any kind shall be imposed on a licensed institution bringing into Nepal foreign currency required for international financial transactions.

(2) Any restriction imposed by the prevailing law relating to foreign exchange shall not apply in respect of a licensed institution. 7.