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Chapter-2 Provisions relating to License

Chapter-2 Provisions relating to License

3. Prohibition on carrying out construction without license: No person shall carry out or cause to be carried out public construction works without having obtained the license pursuant to this Act. Provided that, this Section shall not be deemed to prevent the carrying out of public construction works to be carried out through a consumers’ committee or public participation pursuant to the prevailing law.

4. License: (1) A construction entrepreneur who intends to carry out public construction works shall make an application, accompanied by such fees and in such format as may be prescribed, to the committee for the license to carry out public construction works. (2) If an application is made pursuant to Sub-section (1), the committee shall examine the application as prescribed and make recommendation to Government of Nepal to issue the license of the class which appears to be

appropriate, out of the classes of construction entrepreneurs classified pursuant to Section 8.

(3) Government of Nepal shall issue the license in the format as prescribed to the applicant recommended by the committee pursuant to Subsection (2).

(4) Notwithstanding anything contained in Sub-sections (2) and (3), Government of Nepal may also issue the license of class “B”, without recommendation of the committee.

5. Validity period and renewal of license: (1) Except in cases of annulment pursuant to Section 7, the license issued pursuant to Section 4 shall remain valid for one fiscal year. The validity period of the license shall expire on the last day of that fiscal year irrespective of the date of issue of such license. (2) Each construction entrepreneur whose license has expired pursuant to Sub-section (1) shall get such license renewed, as prescribed, by the prescribed authority by paying the prescribed fees no later than three months of the date of expiration of such license. (3) A construction entrepreneur who intends to get the license renewed within six months of expiration of the time limit as referred to in Sub-section (2) may get the license renewed as prescribed by paying the prescribed fees.

6. Temporary license: (1) The temporary license to carry out public construction works shall be issued to a foreign construction entrepreneur who is selected in an international competitive bidding and who is involved in joint venture with a native construction entrepreneur in a local competitive bidding exceeding sixty million rupees. (2) The fees and format of the temporary license to be issued pursuant to Sub-section (1) shall be as prescribed. (3) No foreign construction entrepreneur having obtained the temporary license pursuant to this Section shall carry out any public construction works other than the works mentioned in such license.

7. Annulment of license:

(1) In the following circumstances, Government of Nepal may, on recommendation of the committee, annul the construction entrepreneur license: (a) where the license is obtained on submission of false statements, (b) where false statements and related documents are submitted to Government of Nepal and corporate body with intent to carry out, or cause to be carried out, public construction works, (c) where the entrepreneur is held to have failed to carry out works of standard quality.

(2) Prior to annulling the license pursuant to Sub-section (1), a reasonable opportunity shall be given to the concerned construction entrepreneur to furnish explanation.

(3) The license not renewed within the time limit a referred to in Section 5 shall ipso facto be annulled.

(4) Where the license is annulled pursuant to Sub-section (1) or (3), information thereof shall be given to the office registering the firm or company concerned.


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