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Why was Non-Resident Nepali (NRN) Nepal Development Fund (NDF) established?

The fund was incorporated under the Companies Act to encourage NRN to invest in infrastructure, energy, water, waste management, urbanization, financial sector, transport, and communication and manage these investments on a commercial basis.

What is the investment focus of NDF?

NDF will focus on different areas of economic activities and will invest in various sectors such as energy, transport, communication, finance, water and waste management, urbanization, education, health, etc.

Where did NDF original investment sources come from?

The initial investment comes from NRN and Government of Nepal.

Who are NDF’s initial shareholder?

NDF’s shareholder are the Nepal’s Ministry of Finance and Non-resident Nepali.

How can I invest in NDF?

You can either be the promoter of NDF or invest though initial public offering (IPO). However, promoter shares has already been subscribed.

What is the minimum and maximum amount for investment?

The minimum investment required for a promoter is NPR 25 lakh (NPR 2.5 million) and the maximum amount is NPR 10 crore (NPR 100 million).

Can I invest in local currency?

Except for shares reserved as per the IPO guidelines of Security Board of Nepal (SEBON), all investment must be made in foreign currency.

What will be minimum and maximum amount investment for the IPO?

The minimum amount for IPO will be NPR 50,000, subject to the provision of SEBON and the maximum amount will be NPR 10 crore (NPR 100 million).

Can foreign company investment in NDF?

No, Investor must be individual and can be Non-resident Nepal and/or Person of Nepali Origin.

I am maintaining foreign currency account in Nepal, can I utilized that?

Yes, you can use foreign currency deposits in Nepal for the purpose of investment in NDF.

Can I plough back from my previous Foreign Direct Investment (FDI) in Nepal?

Yes, you can use profit or gain earned from the foreign investment in Nepal.

Is NDF a statutory board or a government agency?

NDF is neither a statutory board nor a government agency. NDF is a commercial investment company governed by the provisions of the Company Act 2063 and Non-resident Nepali Act, 2064 and Public-Private Partnership and Investment Act 2019. As a NDF is public limited entity, we are required to make a corporate governance statement, to comply will with best practice.

Like any other commercial companies, NDF has its own Board of Directors and a professional management team. It pays taxes to tax authorities, and distributes dividends to its shareholder.

Is NDF required to pay tax?

NDF pays the required taxes to the tax authorities.

Can NDF distribute dividend to shareholders?

NDF declares dividends to its shareholder, as a commercial investment holding company.

Is the FDI locked in?

Yes, every FDI is locked in at least for one from the date of investment. Further, the minimum suggested by Security Board of Nepal (SEBON) is three years. However, application has been submitted to SEBON for the reduction of locked in period.

Can I repatriate my money?

Yes, after the locked in period you can repatriate your Investment.

Can your profits be easily repatriated?

Yes, you can repatriate after paying necessary tax.

How easy is it to withdraw money?

You can withdraw some or all of your money at any time from NDF.

Will NDF’s share be listed in Stock Exchange of Nepal (NEPSE)?

Yes, it will be listed in NEPSE.

Will it be traded in Foreign Currency?

No, it will be traded in Nepali Currency. However, you can repatriate profit or gain in foreign currency.

Will the investors of NDF can expect returns?

NDF expect to provide returns on the investment from initial years.

Do I have to pay tax on my return?

Yes, you are subject to tax as per Nepali Income Tax Act and as per the tax regulation of the country of domicile.

Does NDF disclose its financial results? How can I find out more about NDF?

NDF needs to publish its annual report, which serves as a public scoreboard of its business and performance. As a public limited company, NDF is required to disclose financial information. NDF’s annual report is prepared as per Nepal Financial Reporting Standards (NFRS).

NDFs annual disclosure exercise, which also include an online version of the NDF Review, media engagement, and advertising. NDF has also established a presence on digital platforms Twitter, Facebook, Instagram, LinkedIn, and Youtube to reach out and further engage the public.

Is NDF credit rated?

NDF will obtain it’s credit rating.

Is NDF allowed to take deposit from individuals?

No. NDF does not manage public deposits.

Is Government of Nepal involved in NDF’s business decisions?

No. The government is not involved in NDF’s investment, divestment, or any other business or operational decisions. The board operates as an independent body and is fully authorized as a public limited company to take investment, divestment, or any other business or operational decisions.

What is the role of Government in NDF?

Government will have it representation in the board and can exercise voting right as per prevailing laws. The government does not guarantee or will take custodial role to safeguard NDF’s investment.

Will NDF operate with prudent business practices?

Yes, it has good governance system and it will follow best business practice. When NFD invest in a portfolio of shares, there are constant changes in market values. NDF’s Board/CEO has a responsibility to ensure that every investment and disposal of investment are transacted at fair market value.

What will happen if NDF make loss?

Loss will be shared by shareholders. When investing to maximize long term returns, NDF may have realized gains or losses on disposal of shares. NDF may realize losses in investments, either because the investment has gone bad, or it has decided to exit in order to redeploy the funds to more attractive opportunities. NDF may exit at a high or a low, depending on its judgement regarding the potential returns compared to putting the same rupee to work elsewhere. NDF will exercise business prudence and maintain good governance to protect the commercial interests of its shareholders.

Will share price of NDF fluctuate?

When we invest in a portfolio of shares, there are constant changes in market values.

Does NDF request representation on the boards of companies in which it invests?

NDF will be represented on the boards of its portfolio companies. NDF employees on boards would be appointed in their personal capacity, and are expected to meet their fiduciary responsibilities as directors of companies. NDF promotes sound corporate governance in its portfolio companies by supporting high caliber, experienced and diverse boards to complement management leadership. By leveraging its wide network of contacts, NDF will suggest qualified individuals for consideration by the respective boards.

What are the sources of NDF for its investments?

NDF investments are financed using equity raised from its shareholders and dividends and other cash distributions it receives from its portfolio companies and other investments, divestment proceeds from sale of its investments, and borrowings and debt financing sources.

What is NDF’s divestment schedule?

NDF does not have a divestment schedule.

How does NDF engage with the NRN community?

NDF will support philanthropic programmes that focus on NRN community.

How does NDF work with its portfolio companies?

NDF manages its portfolio as an active investor increasing, decreasing, or holding our investments to enhance our risk-adjusted returns for the long term. NDF promotes sound corporate governance in its portfolio companies. Companies in NDF’s portfolio are guided and managed by their respective boards and management. NDF does not direct their business decisions or operations.

NDF advocates that boards be independent of management in order to provide effective oversight and supervision of management. Encouraging portfolio companies to appoint non-executive members on boards with the independence and experience to oversee management. Similarly, NDF advocates that the Chairman and CEO roles be held by separate persons, independent of each other.

I don’t have PAN Number and Demat Number in Nepal, what should I write in KYC form

If you have not obtained your PAN Number and Demat Number please leave it blank. KYC sample form