Who Owns Employee Inventions in Nepal?

Neither Nepal's patent law nor the Labour Act hands an employee's invention to the employer automatically. The Patent, Design and Trade Mark Act 1965 lets the inventor, or someone who acquired the right from the inventor, apply for a patent. An employer gets a staff invention through the employment contract and a signed written assignment, then registers it.

Key takeaways

• The Patent, Design and Trade Mark Act has no employee-invention rule; the word "employ" does not appear in it.
• A patent applicant must be the inventor or a person who acquired the right from the inventor (Sec. 4 and Sec. 6).
• The Labour Act 2017 requires an employment contract but says nothing about inventions.
• A written assignment signed by every inventor, before filing, is the employer's real protection.
• Registered patents are published in the Nepal Gazette, and objections run 35 days from seeing or copying the patent.
• A patent lasts seven years from registration and is renewable twice, 21 years at most.

Who owns an invention an employee makes in Nepal?

On the Act's wording, the right to apply starts with the person who invented it. Title then comes from registration: Sec. 3(1) says a person wanting rights over a patent "shall register such patent in his/her name". Until someone registers it, nobody holds a patent at all.

So the question an employer should ask is not "does the law give it to us?" but "can we show the inventor passed the right to us?". If the answer is a signed assignment, the company files in its own name. If the answer is "it was part of the job", you are relying on a contract argument the Act does not settle.

This page covers the employer and employee angle. For ownership questions in general, such as co-inventors and buyers, see who actually owns an invention.

What does the Patent, Design and Trade Mark Act say about employee inventions?

Nothing directly. We read the Nepal Law Commission's consolidated English text of the Act, amended to 2006: it has no "service invention" rule, no work-for-hire rule and no mention of employers or employees. Sec. 2(a) defines a patent as a useful invention of a new process, method or formula, without saying who made it.

What the Act does regulate is the applicant. Sec. 4(1)(a) asks for the name, address and occupation of the person who invented it. Sec. 4(1)(b) asks, if the applicant is not the inventor, "how and in what manner he/she acquired title thereto from the inventor".

The Schedule 1(a) application form even opens with "Since I am/We are the inventor/s". An employer company is never the inventor, so it always applies as the person who acquired the right.

Who is allowed to apply for a patent in Nepal?

Sec. 6(1) lists four cases where the Department of Industry (DoI) will not register a patent. Clause (b) covers an applicant who "is not the inventor … nor has acquired rights over it from the original inventor". Clause (a) covers a patent already registered to someone else.

Sec. 6(2) lets the DoI cancel a patent that was registered in any of those cases, after giving the patentee a chance to show cause.

The DoI's own checklist for a domestic patent asks for the inventor's name, address and occupation and, as a separate item, the patent owner's name and address. The full list is on the DoI's Industrial Property Section page.

Does the Labour Act give employers rights to inventions?

No. We searched the English text of the Labour Act 2017 (2074) for invention, patent and intellectual property: none appears. Sec. 11 does say no employer may employ anyone without an employment contract setting out pay, benefits and conditions.

That contract is where invention terms belong. Sec. 131(4)(g) and (h) make it dismissible misconduct to leak a production formula or confidential information with intent to cause loss, or to pass secrets to a competitor. Those clauses protect confidentiality; they do not transfer ownership of anything.

How does an employer secure a staff invention?

Treat it as a chain of paperwork that starts on an employee's first day, not on the day of the breakthrough.

1. Contract clause. Put an invention and confidentiality clause in every employment contract required by Sec. 11 of the Labour Act.
2. Written disclosure. Ask staff to report each invention in writing, dated, to a named person.
3. Assignment. Have every inventor sign an assignment for that invention before anyone files.
4. Keep it quiet. Sec. 5 asks whether the invention is new, so avoid publishing it before you apply.
5. File at the DoI. Apply in the company's name, naming each inventor and attaching the assignment as evidence under Sec. 4(1)(b).
6. Registration certificate. After examination, pay the registration fee and receive the certificate (Sec. 7).

Our patent registration team prepares the specification, claims and ownership papers together. The filing stages themselves are set out in patent registration steps from idea to granted patent.

What should a written invention assignment say?

A clause in a contract signed years ago may not name the invention you now want to patent, so take a short, invention-specific assignment as well. It is the document that answers the Sec. 4(1)(b) question in one page.

Where there are co-inventors, each one signs. The Schedule 1(a) form allows "I am/We are", and a missing signature leaves part of the right outside the company.

What if an employee files the patent first?

This is the real risk. Title comes from registration and the first-to-file principle generally applies, but an employee who really is the inventor passes the Sec. 6(1)(b) test. On the Act's wording, the DoI has no ground to refuse them for being an employee.

The employer's claim then rests on the contract: an assignment the employee signed, or a clause it says covers the invention. Whether a court or the DoI will move a registered patent on that basis is a question the Act does not answer, so take an advocate's advice early. A signed assignment before filing avoids the whole argument.

Can a patent filed by the wrong person be challenged?

Yes, in two ways. Sec. 7A(1) has the DoI publish registered patents in the Nepal Gazette, not in the Industrial Property Bulletin that carries trademarks. Under Sec. 7A(2), anyone may see or copy the patent's particulars and drawings on paying a fee.

Sec. 7A(3) then allows a complaint within 35 days from the date a person sees or copies the patent, and Sec. 7A(4) has the DoI inquire.

Separately, Sec. 6(2) lets the DoI cancel a patent granted to someone who was neither the inventor nor had acquired the right. A party unhappy with a DoI order may appeal within 35 days (Sec. 27).

Is staff-written software a patent or a copyright question?

Usually copyright. Code, manuals and drawings are works under the Copyright Act 2002, whose Sec. 6 has no employment rule either. The author is generally the first owner under Sec. 6(1), subject to the specific exceptions in Sec. 6(2).

Do not rely on salary or payment alone. Sec. 24(1) lets the owner transfer economic rights "by making a written agreement", so take a signed assignment.

Moral rights under Sec. 8, such as being named as author, stay with the author and cannot be transferred during their lifetime. See work-for-hire and copyright ownership in Nepal and who owns your startup's source code.

Who owns a product design or brand made by staff?

For an industrial design, Sec. 12 and Sec. 13 let the person who manufactures the article, or has it manufactured, register it. The Act asks no inventor-style question, yet the DoI's checklist still asks for the designer's name, address and occupation. See industrial design ownership, and our industrial design service for filing.

A brand is simpler. Under Sec. 16(1) a person acquires title to a trademark "upon registration", so the company files in its own name, under the correct NICE classification, through our trademark registration service. Before launch, run the product name through the trademark conflict checker.

How long does an employer-owned patent last?

Sec. 8 sets a term of seven years from the date of registration. Under Sec. 23B(3) a patent is renewable not more than twice, seven years at a time, so 21 years is the maximum.

Renew within 35 days after the term expires; Sec. 23B(2) allows six more months on a fine, after which the registration is cancelled automatically. Staff move on, so keep renewal dates in company records.

How do foreign parent companies protect inventions made in Nepal?

Sec. 21B says a patent registered abroad has no validity in Nepal until it is registered here. Sec. 21C lets the DoI register a foreign-registered patent without its usual enquiries and gives Paris Convention facilities, including the 12-month priority period for patents in Article 4C.

Nepal is not in the Patent Cooperation Treaty: it is absent from WIPO's list of PCT members, read on 17 October 2026.

A foreign owner usually files through a local agent with a power of attorney, which Sec. 20 allows. The assignment chain must reach the Nepal staff who invented it.

How many patents does Nepal record?

Very few. Nepal's Economic Survey 2082/83 lists 90 patents recorded by the DoI up to Falgun 2082 (mid-March 2026), 54 domestic and 36 foreign. Only 22 of them date from fiscal year 2067/68 onward.

IP Sewa's archive of more than 120 bulletins holds 71,500+ published trademarks and no patent register, so we cannot add per-patent figures. With so few filings, most employers meet this question only once.

Common mistakes employers make

• Assuming the job equals ownership. The Act has no such rule; get a signed assignment.
• Relying on an old generic clause. Add an invention-specific assignment before filing.
• Missing a co-inventor. Every inventor named should sign.
• Publishing first. A launch or paper before filing can undermine novelty under Sec. 5.
• Using trademark rules. Patents use the Nepal Gazette and a 35-day objection period, not the trademark Bulletin.
• Forgetting the code. Software is a copyright question, needing its own assignment.

How does this play out in a real workplace?

Here is an illustration, not a real case. An engineer at a Kathmandu food-processing firm designs a faster rice-sorting device on the factory floor. Her contract has a broad confidentiality clause, but nothing on inventions.

She leaves and files a patent application in her own name. As the inventor, she meets Sec. 4. The firm must now argue that its contract covers the device, instead of filing with a one-page assignment signed in her first week.

Universities face the same issue with researchers and students; see university research ownership. And before any filing, check the device clears the patent eligibility requirements.

In short: who owns employee inventions in Nepal?

No Nepali statute gives an employee's invention to the employer automatically. The Patent, Design and Trade Mark Act lets the inventor or their assignee apply, so ownership rests on the employment contract and a signed assignment, then registration at the DoI.

Write the clause into every contract, take an assignment for each invention and file before you publish. For a dispute already under way, speak to an advocate.

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Have a staff invention to protect? Our patent registration service handles the assignment papers and the filing, or contact IP Sewa to talk it through.