IP Due-Diligence Checklist (Nepal)

An IP due-diligence checklist for Nepal verifies that the trademarks, patents and designs you are buying, licensing or investing in are actually registered, valid and free of disputes — by checking the Department of Industry (DoI) public record, the Industrial Property Bulletin, and the ownership chain — all under the Patent, Design and Trademark Act 1965 (PDTA).

Key Takeaways

• Nepal is first-to-file — ownership follows the first valid registration at the DoI, not first use in the market.
• Always run a DoI record search before you invest; the public register shows registrations, renewals, cancellations and oppositions.
• Verify the exact NICE class(es) listed on the certificate — one application covers one class in Nepal, and missing a class means missing protection.
• Check the seven-year renewal cycle and the 35-day renewal window; a lapsed registration is automatically cancelled.
• Review the Industrial Property Bulletin for pending 90-day oppositions that could kill the mark after your deal closes.
• Foreign marks need a notarised home registration certificate and a valid Power of Attorney filed through a Nepal-based agent.
• If any chain-of-title document (assignment, licence, name change) was not recorded at the DoI, the right may be unenforceable against third parties.

What does IP due diligence mean in Nepal?

IP due diligence in Nepal means systematically verifying that the intellectual-property assets at the heart of a deal — a brand name, a logo, a patent, a design — are legally valid, owned by the party claiming them, and not at risk of cancellation or opposition. The exercise is governed by the PDTA and administered by the Department of Industry. Unlike some jurisdictions where common-law rights give unregistered marks a degree of protection, Nepal operates a strict first-to-file system. If a mark is not on the DoI register, it carries no statutory rights.

Why IP due diligence matters before you invest or buy a business

Buying a company or investing in a brand without checking the IP register is, in Nepal, effectively buying blind. A common scenario: a restaurant chain looks fully branded — signage, menu names, delivery-app listings — but the core wordmark was never registered, or was registered in the wrong NICE class, or lapsed because the owner missed the 35-day renewal window. The PDTA provides no safety net for unregistered marks, and the DoI will cancel a registration not put to use within one year. Due diligence catches these gaps before money changes hands.

Who should run an IP due-diligence check in Nepal?

Any person or entity acquiring a business, merging with a Nepali company, licensing a brand, or lending against intangible assets should run a full check. This includes foreign companies taking a stake in a Nepali venture — remember, Nepal is not a member of the Madrid System, so a foreign registration alone gives no rights here. Local banks accepting a trademark as collateral, franchisees signing a master agreement, and distributors buying exclusive rights to a branded product line all need the same verification. Even an employer taking assignment of a mark invented by a departing founder should confirm the record reflects the transfer at the DoI.

Which NICE classes are relevant for due diligence?

In Nepal, one trademark application covers exactly one NICE class. A due-diligence review must map every product and service the business actually sells to the 45-class NICE Classification system and then cross-check that the registration certificate lists every relevant class. Missing even one class is a material gap — if a clothing brand registered only Class 25 (clothing) but also runs a retail outlet, Class 35 (retail services) is unprotected. Use the NICE Class Finder to build a complete class map before you compare against the certificate.

How to conduct IP due diligence in Nepal — step by step

1. Identify every IP asset. List the registered and unregistered marks, logos, taglines, product names, domain names, patents and designs the target business uses — even those it uses but never filed.
2. Run a DoI public-register search. Check each mark on the Department of Industry record. Confirm the applicant name, registration number, filing date and current status. Use the Owner & Applicant Search to pull every registration held by the entity.
3. Map NICE classes to actual commercial activity. Compare the classes on each certificate against what the business really does. A gap here is one of the most common deal-breakers we see in practice.
4. Trace the ownership chain. Verify assignments, licences, mergers or name changes were recorded at the DoI. An unrecorded assignment may leave the mark vulnerable — the PDTA requires written transfer and DoI endorsement.
5. Review the Industrial Property Bulletin. Check recent and pending publications for any 90-day opposition that could jeopardise the mark. An opposed application can stall for months while the DoI Law Division runs its inquiry.
6. Confirm renewal status and deadlines. Trademark registrations last seven years in Nepal. Confirm the next renewal date and whether the mark is within the 35-day renewal window or the six-month late-renewal grace period.
7. Check for use obligations. Under the PDTA, a mark not put to genuine use within one year of registration is vulnerable to cancellation. Ask for evidence of continuous use — invoices, packaging, advertisements — for each registration.
8. Review any licences, franchises or pledges. If the IP is licensed to a third party or pledged as collateral, pull the recorded agreements. Unrecorded licences may not bind a subsequent purchaser.

Documents you need to request from the target company

For every registered mark, patent or design, ask for the original DoI registration certificate (Schedule 2(c) under the PDTA), the filing receipt, any recorded assignment or licence agreements, the notarised Power of Attorney used during filing, and the latest tax clearance letter if the owner is a Nepali entity. Foreign marks require the notarised home registration certificate and a certified English translation if the original is in another language. Without these, you cannot confirm the registration is still in force or that the applicant had proper authority to file.

What is the timeline for an IP due-diligence review in Nepal?

A thorough review typically takes one to three weeks, depending on how quickly the target company produces the documents and whether the DoI register is fully accessible for the classes involved. The DoI public record is the single source of truth, but word-mark searches are more reliable than searches for figurative or logo elements, which are harder to match electronically. If you find an anomaly — a lapsed renewal, a pending opposition, an unrecorded assignment — resolving it can add months, especially if it requires a DoI hearing or a corrective filing through a local agent.

What makes IP due diligence cost what it does?

Cost is driven by the number of marks, classes and jurisdictions you need to verify — plus any remedial work if gaps surface. A single-class, single-mark review is straightforward; a multi-brand portfolio spread across goods and services classes takes more time. Professional fees cover the DoI register search, Bulletin review, document reconciliation and the written diligence report. If the review uncovers a lapsed renewal or an unrecorded assignment, you will also need to budget for the corrective filing. For a current figure tailored to your portfolio, try the Trademark Fee Calculator or contact us with the asset list.

Legal basis for IP due diligence in Nepal

The PDTA is the governing statute, and the Department of Industry is the registering and quasi-judicial authority. Sections 16–21D of the Act define how trademark rights are acquired, transferred and enforced. Section 18A mandates the class-based registration system (one application per class), Section 21A governs publication and the opposition mechanism, and Sections 18D and 23B set the seven-year term and renewal process. Nepal is a member of the Paris Convention and TRIPS, which means priority claims from convention countries are recognised — but you must verify that the priority document was properly filed at the DoI within the convention deadline.

Common mistakes that derail an IP due-diligence review

A mistake we see repeatedly: the buyer assumes a foreign registration covers Nepal. It doesn't — Nepal is outside the Madrid System, so you need a separate Nepali registration. Another classic error is accepting a certificate without checking the actual NICE classes listed on it; a Class 43 restaurant mark does not protect a packaged food product sold in supermarkets, which needs Class 29 or 30. Buyers also overlook the one-year use requirement. A mark registered three years ago but never used commercially is a ticking time bomb. Finally, failing to record an assignment at the DoI means the seller remains the legal owner on the public register, and the buyer has no standing to enforce the mark.

A realistic Nepal example: buying a café brand in Kathmandu

Imagine you are buying a popular café brand with three outlets in Kathmandu and Pokhara. The seller hands you a registration certificate for the brand name in Class 43. Your due-diligence checklist would reveal that the logo — a distinct illustrated character used on every cup and T-shirt — was never registered separately, leaving it unprotected. The café also sells packaged coffee beans online, but Class 30 (coffee) was never filed. Worse, the Industrial Property Bulletin shows a pending opposition from a competitor who claims the name is confusingly similar to their own registered mark. Without due diligence, you would have inherited a partly protected brand, a gap in your core product line, and an ongoing legal dispute. Spotting these issues early lets you negotiate a price reduction or require the seller to resolve them before closing.

Alternatives and edge cases

Not every deal requires a full-blown IP audit. A minority investment where the brand is incidental may need only a quick DoI status check through the IP Sewa search tool. A licence or franchise agreement should still verify the licensor's registration and renewal status — if the licensor's mark lapses, the licensee has no right to use it. For a merger where the surviving entity changes its name, record the name change at the DoI immediately; an unrecorded name change creates a mismatch between the register and the actual owner. And if the target holds a patent or industrial design, remember that patents expire after seven years and designs after five years unless renewed — check those dates just as carefully as trademark deadlines.

In short: IP due diligence in Nepal is about verifying what the DoI register actually says — not what the seller tells you. Check the registration, the classes, the ownership chain, the Bulletin, and the renewal clock. One gap in one class can turn a confident deal into an unsecured investment.

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Every deal is different, and a checklist is only as good as the person running it. If you need a trained eye on a specific portfolio, run a preliminary DoI search or reach out — we will walk you through what the register really says about the assets you are about to buy.