Laws
Analysis: conflicts, loopholes and gaps
A head start for lawmakers: research candidates drawn from official reports, each awaiting qualified legal review.
Each card is a question worth examining: where two laws may pull in different directions, where a rule leaves room for misuse, or where something the law requires has not happened. Each one links the exact sections, the official evidence, possible readings, practical options and the questions a legal reviewer should answer.
11 Possible conflict between laws2 Possible loophole2 Gap in the law6 Unclear wording5 Outdated provision2 Not yet implemented
Possible conflict between laws
Alcohol and tobacco advertising: banned under health law, but claimed as a deductible business expense under tax lawThe Public Health Service Act 2075 bars producing, distributing and broadcasting advertising for alcohol, cigarettes and tobacco. The Income Tax Act 2058 lets businesses deduct expenses incurred in earning business income and does not expressly exclude spending on advertising the law forbids. The Auditor General reported in two successive annual reports that large alcohol and tobacco taxpayers claimed such spending as deductions, and said the two Acts should be brought into line.Medium confidence · 2026-10-12Citizen Investment Trust board: its Act puts the stock exchange's general manager on the board, while a securities regulation bars directors who hold an office of profit in the securities marketSection 25(1)(घ) of the Citizen Investment Trust Act 2047 makes the general manager of Nepal Stock Exchange Limited an ex officio director of the Trust. The Auditor General reports that this conflicts with rule 14(ख) of the Securities Businessperson Regulation 2064, under which a person holding an office of profit in the securities market cannot be a director. Our reading of the Securities Businessperson (Merchant Banker) Regulation 2064 published by the Securities Board finds a rule 14(ख) to that effect for directors of merchant bankers. Whether the rule reaches the Trust, and which text prevails, is a question for legal review.Medium confidence · 2026-10-12Dowry: two in-force laws punish it with different penalties, forums and time limitsSections 3–6 of the Social Practices (Reform) Act 2033 regulate dowry and related demands at marriage, with fines up to Rs 40,000 and short imprisonment, decided by the Chief District Officer within a 35-day limit. Section 174 of the Criminal Code 2074 punishes demanding or exchanging dowry as a condition of marriage with up to three years (five years for later harassment), decided by courts within three months of knowledge. The High-Level Economic Reform Suggestion Commission said s.174 already covers the dowry provisions and recommended repealing the 2033 Act.Medium confidence · 2026-10-12Equalization grants: annual Appropriation Acts let the last two instalments be recalculated by revenue performance, while the Constitution and the fiscal Acts tie the amount to the Commission's recommendationThe Intergovernmental Fiscal Arrangement Act 2074 (s.8) says equalization grants are distributed on the recommendation of the National Natural Resources and Fiscal Commission. The Appropriation Acts of 2081, 2082 and 2083 say that the third and fourth quarterly instalments of the equalization grant are recalculated according to federal revenue collection against target. The Commission reports that, through such a clause, equalization grants were cut by 8.51 per cent for provinces and 8.56 per cent for local levels, and treats its recommendation as not implemented.Medium confidence · 2026-10-12Fiscal transfers: the Constitution ties their amount to the Fiscal Commission's recommendation, but the Acts give it a role only for equalization grantsArticle 60(3) of the Constitution says the amount of fiscal transfers that provinces and local levels receive shall be as recommended by the National Natural Resources and Fiscal Commission. The Intergovernmental Fiscal Arrangement Act 2074 gives the Commission a recommending role only for equalization grants; for conditional grants it sets bases, and complementary and special grants follow procedures the federal government sets. The Commission and the Auditor General both say the Acts should be amended to match Article 60(3). Article 60(6), however, leaves conditional, complementary and special grants to federal law, so whether there is a real conflict is a question for legal review.Medium confidence · 2026-10-12Hoarding, adulteration and deceptive sale: the same conduct punished under the Black-Market Act, the Consumer Protection Act and the Criminal CodeThe Black Market and Some Other Social Offences and Punishment Act 2032 punishes overpricing, diversion, hoarding, deceptive sale and adulteration of medicines. The Consumer Protection Act 2075 and the Criminal Code 2074 (ss.107–110) cover hoarding, adulteration and deceptive sale too, with different penalties, forums and time limits. The High-Level Economic Reform Suggestion Commission said this overlap lets different bodies act against the same business and recommended repealing the 2032 Act.Medium confidence · 2026-10-12Indigenous Nationalities Commission and the National Foundation for Upliftment of Adivasi Janajati: overlapping mandates and two different legal definitions of 'Adivasi Janajati'The Auditor General reported in two successive annual reports that the responsibilities given to the Adivasi Janajati Commission by its 2074 Act and those given to the National Foundation for Upliftment of Adivasi/Janajati by its 2058 Act overlap, and called for laws to be revised to bring uniformity in the identification and definition of these communities. Reading the two Acts side by side, both bodies have functions on language, culture, history, traditional skills and programmes for disadvantaged members of the communities, and the two Acts define 'Adivasi Janajati' differently: one by a fixed schedule, the other as groups the government designates on the Commission's recommendation.Medium confidence · 2026-10-12Public transport routes and fares: the federal Act, provincial Acts and a metropolitan Act each give the power to a different bodySection 153(gha) of the federal Motor Vehicles and Transport Management Act 2049 gives the federal Department of Transport Management power to fix routes and public vehicle fares. The Auditor General reports that a provincial transport Act and a metropolitan city's transport Act also give their own bodies power to fix routes and fares in the same area, and that penalties for the same traffic offence differ between federal and provincial law. It recommends a federal transport law that removes the duplication. The Constitution puts national transport policy and national highways on the federal list, provincial highways and transport on the provincial list, and local roads on the local list.Medium confidence · 2026-10-12Right to information versus secrecy duties: officials face one law that requires disclosure and others that punish unauthorised disclosureThe Right to Information Act 2064 gives every citizen access to information held by public bodies, subject to five listed exceptions, and leaves classification of sensitive information to a committee under s.27. The National Information Commission reports that many laws in force conflict with the RTI Act, so officials are unsure whether to disclose or withhold: one law says to give information, another makes unauthorised disclosure punishable. It also reports that classification under s.27 has never been completed and that the oath of office and secrecy adds to the confusion. The Commission does not name the conflicting laws; the Civil Service Act's secrecy provisions are one example we identified.Medium confidence · 2026-10-12Tax evasion: a separate investigation track under the Revenue Leakage Act alongside the powers in each tax lawThe Revenue Leakage (Investigation and Control) Act 2052 makes evasion of any tax an offence and gives the Department of Revenue Investigation power to investigate it. The Income Tax, VAT, Excise and Customs Acts also give the tax and customs offices power to search, recover, stop travel, prosecute and (for customs) decide cases. The High-Level Economic Reform Suggestion Commission said this creates duplicate investigation and recommended repealing the 2052 Act. The Customs Act 2082, passed later, still refers to officers acting under the revenue leakage law.Medium confidence · 2026-10-12Who owns and manages heritage sites and temple offerings: the Guthi Corporation Act, the Ancient Monuments Preservation Act and area development Acts point to different bodiesThe Auditor General reports that the Guthi Corporation claims ownership of the land of temples and other heritage sites across the country, while ownership at sites such as Pashupati, Swayambhunath and Boudhanath is disputed between the area development bodies and the guthis that run them. Read side by side, the Guthi Corporation Act 2033 vests rights over raj guthi and the management of temple offerings in the Corporation; the Ancient Monuments Preservation Act 2013 vests ownership of public ancient monuments in the Department of Archaeology and directs up to 50 per cent of offerings to conservation; and the Pashupati Area Development Trust Act 2044 directs guthi income and offerings in the Pashupati area to the Trust. The Auditor General recommends harmonising these Acts.Medium confidence · 2026-10-12
Possible loophole
Central bank leadership benefits: set by a board on which the beneficiaries sit, with 'other benefits' undefined in the ActSection 19 of the Nepal Rastra Bank Act 2058 says the remuneration and other benefits of the Governor, Deputy Governors and directors shall be as fixed by the Board, on which the Governor (as chair) and the Deputy Governors sit. Section 32(2) bars a member from taking part in discussion of a proposal in which he or she has a personal interest. The Auditor General found that the Bank approved a procedure letting the Governor and Deputy Governors buy their official vehicles on retirement at a depreciated price, said it was not appropriate for office-holders to approve a procedure that included their own benefits, and called for the limits of in-service and post-retirement benefits to be set by law.Medium confidence · 2026-10-12Overstated tax losses: the false-return penalty is tied to tax shortfall, so a loss-making return may attract noneSection 120 of the Income Tax Act 2058 charges a fee for false or misleading statements equal to 50 or 100 per cent of the resulting tax shortfall. If a taxpayer reports a loss and the loss is reduced on audit but no tax becomes payable for that year, there is no shortfall to calculate the fee from. The Auditor General reported that tax audits in 2080/81 cut reported losses by Rs 59.74 billion, that no fee or interest applies to loss-making taxpayers, and suggested a fixed percentage of the overstated loss or a fee once the taxpayer returns to profit.Medium confidence · 2026-10-12
Gap in the law
Local borrowing: federal consent required by one Act but not mentioned in another, and local guarantees for user groups' loans with no clear legal basisThe Intergovernmental Fiscal Arrangement Act 2074 requires provinces and local levels to obtain the federal government's consent before taking internal loans. The Local Government Operation Act 2074 lets municipalities borrow within the Commission's limit with their assembly's approval, without mentioning federal consent. The Fiscal Commission reports that 17 local governments borrowed from the Town Development Fund in FY 2082/83 without federal consent, and that local levels have stood as guarantors for loans taken by user groups although no law appears to allow this.Medium confidence · 2026-10-12No federal civil service Act yet: provincial and local service laws are meant to follow federal principles that have not been enactedArticle 285 of the Constitution says the formation, operation and terms of the federal civil service shall be as provided by federal Act. The Employee Adjustment Act 2075 requires provinces and local levels, when making their own service laws, to take the basic principles of the federal civil service law as their basis. The Auditor General reports that, more than nine years after the Constitution, no Federal Civil Service Act has been issued; the 1993 Civil Service Act still applies; all seven provinces have made provincial civil service Acts that do not match it; and the career prospects of staff adjusted to provinces and local levels remain unclear.Higher confidence · 2026-10-12
Unclear wording
'Improper conduct': the CIAA Act still provides for it, while the 2015 Constitution describes the CIAA's investigation power in terms of abuse of authority through corruptionArticle 239(1) of the Constitution of Nepal lets the Commission for the Investigation of Abuse of Authority (CIAA) investigate a public office holder's abuse of authority 'by committing corruption'. The CIAA Act 2048, written under the 1990 Constitution, still defines 'improper conduct' (s.3) as a form of abuse of authority and sets out complaint and departmental-action procedures for it (ss.8–12ग). The CIAA's own report describes the change between the two constitutions, and the National Vigilance Centre says the legal basis for dealing with improper conduct is still not adequate or clear. Whether, and how far, the CIAA may still act on improper conduct that is not corruption appears unsettled.Medium confidence · 2026-10-12Cabinet 'policy decisions' are outside the CIAA's reach, but the law does not define what a policy decision isSection 4 of the CIAA Act 2048 says the Commission shall not investigate or act on a policy decision taken collectively by the Council of Ministers or its committees. The Act does not define 'policy decision'. The CIAA's 35th Annual Report repeats its recommendation that the term be given a clear legal definition. A writ challenging this part of s.4 was reported filed in the Supreme Court in 2079; no decision on it was found.Higher confidence · 2026-10-12Listed-company tax concession for alcohol and tobacco producers: does the Industrial Business Act exclusion reach the Income Tax Act concession?Section 11(3छ) of the Income Tax Act gives a 15 per cent concession on the tax of listed manufacturing entities. Section 24(3) of the Industrial Business Act says tobacco and alcohol industries (other than fruit-based brandy, cider and wine) get none of the concessions it mentions. The Auditor General read these together as denying the listing concession to an alcohol producer and asked for the concession it took to be examined. The wording of s.24(3) can also be read more narrowly.Medium confidence · 2026-10-12Local top-ups to social security allowances: barred under the Social Security Act, but social security is also a shared local powerSection 20(2) of the Social Security Act 2075 says provinces and local governments shall not distribute additional social security allowances under the same headings in a way that duplicates the federal allowance. The Auditor General reported that 27 local levels in FY 2080/81 and 14 in FY 2081/82 paid amounts on top of the allowance set by the federal operating procedure from their own resources. The Constitution lists social security as a federal power and also as a power shared by all three levels, and the Local Government Operation Act gives local levels a role in 'local social security plans', so where the line lies between a barred duplicate and a permitted local scheme is not clear.Low confidence · 2026-10-12Party mergers: the Political Party Act's merger section does not say whether the bars on registering a new party also apply; the Supreme Court has said they doSection 10 of the Political Party Act 2073 lets two or more registered parties merge by agreement and apply to the Election Commission, which issues a certificate if the Act's procedures and conditions are met. Section 6(1) lists cases in which a party cannot be registered, including where its name or symbol matches that of a party already registered (s.6(1)(ङ)). Section 10 does not cross-refer to s.6. In a 2077 decision published in Nepal Kanoon Patrika, the Supreme Court held that a merger under s.10 cannot be registered in breach of s.6, and quashed a merger registration whose name matched an existing party. The Act's text has not been changed to reflect this.Higher confidence · 2026-10-12Price adjustment in design-and-build contracts: the Act bars it for lump-sum contracts, the Rules now build it into cost estimatesSection 55(2) of the Public Procurement Act 2063 says price adjustment may not be made where a contract is on a lump-sum or fixed-budget basis. The Act does not say whether design-and-build contracts are lump-sum. The Auditor General found that, before a 2082 rule change, 22 offices paid Rs 44.86 crore of price adjustment on 75 design-and-build contracts that it considered lump-sum, and so not eligible. The 14th amendment to the Public Procurement Rules (2082/1/15) now includes a 10 per cent price-adjustment contingency in the design-and-build cost-estimate format.Medium confidence · 2026-10-12
Outdated provision
Acquiring private property for public use: three Acts from 2013, 2019 and 2034 cover overlapping groundThe Immovable Property Requisition Act 2013, the Compensation Act 2019 and the Land Acquisition Act 2034 all let the Government of Nepal acquire private property for public purposes and set compensation, each in its own way. The High-Level Economic Reform Suggestion Commission said the three cover the same purpose, called the Compensation Act wholly irrelevant, and recommended merging the other two into a new "Private Property Acquisition Act" that also covers shares and intangible property. Article 25(3) of the Constitution leaves the basis and procedure of compensation to an Act.Medium confidence · 2026-10-12Commercial agents: a 1958 registration Act alongside the Civil Code's agency-contract chapterThe Nepal Agency Act 2014 requires anyone acting as an agent, distributor, stockist or representative for a Nepali or foreign firm to register and file periodic statements of goods and prices. The Muluki Civil Code 2074 (ss.591–601) now governs agency contracts in general. The High-Level Economic Reform Suggestion Commission said the separate registration is unnecessary because agency businesses register as companies or firms anyway, and recommended repealing the 2014 Act. The Government amended the Act's rules as recently as 2080.Low confidence · 2026-10-12Investing abroad: a 1964 blanket ban still stands beside the 2081 rules that open outbound investmentSection 3 of the Act Restricting Investment Abroad 2021 says no one may make any kind of investment abroad unless the Government exempts it by Gazette notice. The Foreign Exchange (Regulation) Act 2019, as amended in 2081, adds s.10क letting certain companies invest abroad "notwithstanding anything in prevailing law", but s.10क itself relies on exemptions issued under the 2021 Act. The High-Level Economic Reform Suggestion Commission called the 2021 Act irrelevant and recommended replacing it with a new outbound-investment law. Its comments on unclear points were made on the 2081 ordinance; the enacted text differs.Medium confidence · 2026-10-12Private forests: a 1957 nationalisation Act remains on the books while the Forest Act 2076 protects private forestsThe Private Forests Nationalization Act 2013 vested all private forests in the State when it commenced, with no compensation. The Forest Act 2076 now lets owners register, manage and sell produce from private forests and says private forests under that Act will not be nationalised. The High-Level Economic Reform Suggestion Commission said the 2013 Act could still be used to nationalise private forests and recommended repeal. The texts suggest the risk may be narrower than the Commission describes.Low confidence · 2026-10-12Technical education council: a pre-federal Act keeps a federal body running schools in an area the Constitution does not list as federalThe Technical Education and Vocational Training Council Act 2045 sets up the Council (CTEVT) as an autonomous body linked to the Government of Nepal through the education ministry. The Auditor General notes that technical education and vocational training is not on the federal list of powers, yet the Council remains under the federal government with 82 offices, while provinces and local levels also set up and run similar schools. It recommends reviewing the Council's scope in line with the constitutional lists and their detailed assignment of functions. The Constitution does list 'education' as a power shared by all three levels, so the extent of any mismatch needs legal review.Medium confidence · 2026-10-12
Not yet implemented
After-the-fact approval of foreign-funded NGO spending: a Social Welfare Council directive provides a route the Social Welfare Act does not mentionThe Social Welfare Act 2049 requires international NGOs to obtain permission and sign an agreement before working in Nepal (s.12), and requires social organisations to apply for approval before receiving foreign or other assistance (s.16). The Social Welfare Council's Directive on Approval of Foreign Assistance 2071 lets organisations that ran programmes without prior approval have the spending approved afterwards, once, after paying a fee. The Auditor General found this not in line with the law, and in two successive years reported several billion rupees of spending in this approval process. The Act itself contains no penalty for proceeding without approval.Medium confidence · 2026-10-12University Grants Commission: procedures issued without express authority in its ActSection 19 of the University Grants Commission Act 2050 lets the Commission make rules, which take effect only after government approval. The Auditor General reported that, although the Commission has rule-making power, it approved and implemented nine procedures where the Act gives no such authority, and said procedures should be drafted using powers the Act gives. A 2082 amendment to the Act added express functions on credit transfer (by directive), quality assurance and accreditation, and equivalence of foreign degrees; whether these now cover any of the nine procedures is not known.Low confidence · 2026-10-12