Business visa misuse rife in Nepal

KATHMANDU, July 22: An overwhelming majority of foreign nationals living in Nepal on business visas are found to have made ´business´ just an excuse to stay here longer and carry out other activities.

Thanks to the Department of Industries which recommends renewal of such visas without monitoring the business activities, the number of foreign nationals acquiring business visas has gone up sharply in recent years.

There are a total 4,884 foreign nationals living in Nepal on business visas. The majority of them have acquired their visas purportedly for running hotels, restaurants, software outsourcing businesses, travel, tour and courier businesses, and others.

According to the Department of Immigration, altogether 927 foreign nationals acquired business visas in the last 11 months of the current fiscal year alone. This figure includes 268 Chinese nationals most of whom obtained business visas for running restaurants and hotels in Kathmandu Valley.

While the primary consideration in acquiring business visas is to stay for longer periods without having to undergo hassles from local authorities, many foreign nationals are found choosing business visas simply to evade higher visa fees.

A person under the tourist category can get a visa for a maximum 150 days at a time and pays 60 US dollars a month. However, one pays just 300 US dollars a year if s/he acquires a business visa. Business visas are renewed each year.

As per the Foreign Investment and Technology Transfer Act 2049 BS, the Department of Industry needs to write a recommendation letter for business visas for foreign nationals who have registered their companies at the Company Registrar´s Office, following approval of their business plans.

Director General Binod KC at the Department of Industry said a recommendation letter for a business visa is written after a foreign national comes up with a concrete plan to invest a minimum of 20,000 US dollars in a business venture in Nepal. “We make the recommendation for the business visa only after all requirements stipulated in the existing laws are fulfilled,” he said. Investment could be in a joint venture with a Nepali national.

But there is a serious problem with the monitoring to see if the foreign nationals are genuinely engaged in their proposed business activities in Nepal.

As per the existing legal provision, the Department of Industry needs to make an inspection visit to the business or industrial venture undertaken by a foreign national while writing a recommendation letter for his visa renewal.

Altogether 1,647 businesses or industrial ventures have been registered in the country so far in the name of foreign nationals. Of these, 150 were registered during nine months of fiscal year 2005/06 alone. Officials admit that a majority of them have not come into operation as yet.

Sadly, there is hardly a case where the Department of Industry refuses to recommend extending a visa as foreign nationals easily bribe officials. Sources said department officials make recommendations without undertaking any inspection visit to the business or industrial undertaking in question.

Normally, a foreign national acquires a business visa for six months the first time. The visa is then renewed each year, with the recommendation of Department of Industry and a tax clearance certificate. In many cases, the tax clearance certificate accompanying the recommendation letter shows zero transaction, according to immigration officials.

“They start quarreling with us if we deny them a visa once they have acquired the recommendation letter from the Department of Industry,” said Tirtha Raj Parajuli of the Department of Immigration. “There would not have been any problem if the recommendation letter is given in the first place only after proper inspection of the business or industry a foreigner is supposed to be running.”

The Immigration Department is also supposed to make inspection visits to the businesses or industrial units and learn about their activities through the National Investigation Department (NID), the intelligence arm of the government, before renewing any visas. However, this is rarely done due to lack of a separate implementation mechanism.

Senior police officials say that failure to effectively implement immigration rules is posing a serious threat to law and order in the country. “It is obvious that those staying on business visas without involving themselves in the businesses they proposed are involved in illegal activities,” argued a senior police official, asking to be unnamed as he is not supposed to talk to media. “It is learnt that many such persons are involved in various illegal activities such as drug smuggling, counterfeit currency rackets and intelligence activities.”

Officials suggest to the Department of Immigration, Department of Industry, NID and Nepal Police to work jointly to effectively ensure that visas are not misused. “It is just not about business visas. Other visas are also found grossly misused due to a poor implementation mechanism for immigration rules,” added the police official.

Published on 2009-07-22 00:00:01