Skip to content
Back to Knowledge Catalog
Nepal

Electronic Commerce Act 2025 – Digital Marketplace Operators and Online Service Transactions

Published on:

Nepal’s Electronic Commerce Act 2025 regulates commercial transactions involving goods or services conducted through information technology. The Act distinguishes between businesses selling their own goods or services and intermediary businesses that facilitate transactions between other parties through an electronic platform. This distinction is directly relevant to a marketplace such as Zooly. An intermediary platform must satisfy registration, disclosure, contracting, complaint-handling, confidentiality and recordkeeping obligations. However, the Act does not determine whether an individual providing services through the platform is an employee or an independent freelancer. Employment status remains governed principally by the Labour Act 2017.

1. Scope and Platform Classification

The Act applies to electronic commerce involving goods or services supplied through information technology. Its territorial reach extends to persons outside Nepal when they provide goods or services within Nepal through electronic commerce.

The Act recognises an “intermediary business entity” as a business that provides an electronic platform facilitating transactions between other business entities and consumers.

A business that directly supplies its own listed goods or services is treated differently from an intermediary facilitating third-party transactions.

Explanation

Public Explanation Nepalese law distinguishes an online marketplace from the businesses or professionals offering services through it. For Zooly, this supports the distinction between: Zooly as the technology or marketplace provider; the Marketplace Operator or Tenant operating the marketplace; the client purchasing professional services; and the freelancer providing those services.

2. Registration and Platform Transparency

Businesses conducting electronic commerce must be duly established under applicable law and listed through the government’s electronic-commerce portal.

The platform must disclose prescribed information concerning the business, including identifying and contact information, registration details and information necessary for users to understand who operates the service.

An intermediary platform must also provide sufficient information about the traders or service providers using the platform and the terms governing electronic transactions.

Explanation

Users must be able to identify the platform operator and understand which party is actually offering the service. A marketplace should not create uncertainty about whether the contract is with the platform, the client, the Marketplace Operator or the freelancer.

3. Electronic Contracts, Information and Complaints

The Act regulates information that must be made available before an electronic transaction is concluded. This includes material information about the goods or services, prices, payment arrangements, applicable conditions and complaint procedures.

Electronic-commerce businesses must establish mechanisms through which users can submit complaints. They must address complaints within the statutory framework and retain relevant transaction records.

The platform must not engage in misleading, deceptive or otherwise improper commercial practices.

Explanation

A digital marketplace must clearly explain what is being purchased, from whom, under which conditions and how a user can challenge a problem.

4. Relationship with Employment Classification

The Electronic Commerce Act regulates the digital marketplace and the electronic transaction. It does not create a special employment category for platform workers or establish a presumption that service providers are independent contractors.

A person described on the platform as a freelancer may still claim an employment relationship under Section 12 of the Labour Act if the practical relationship contains the characteristics of employment.

Conversely, operating through a digital marketplace does not automatically make every freelancer an employee. Genuine independent service provision remains possible.

Explanation

Compliance with e-commerce law does not settle whether a freelancer is truly self-employed. The platform and the underlying work relationship must be assessed separately.

Sources

Related knowledge

View all knowledge

Freelancer Misclassification in Nepal

Nepal does not currently appear to have a dedicated statutory regime determining the employment status of workers engaged through digital labour platforms. Platform workers must therefore be classified through the general Labour Act. The central issue is whether the platform or client actually employs the person to perform work, whether the platform supplies labour to a main employer, or whether the person operates a genuinely independent business. The use of an app, freelance agreement, tax registration or payment-per-task model does not automatically decide the issue. Equally, the Labour Act does not create an automatic presumption that every platform worker is an employee.

Nepal

Employment-Status Disputes, Enforcement and Remedies in Nepal

Nepal does not appear to have a large, easily accessible body of reported judgments specifically using the terminology “false self-employment” or “freelancer misclassification.” The principal protection instead comes directly from the Labour Act. A worker can seek recognition of an employment relationship through the Labour Office, Department of Labour and Occupational Safety or, where procedurally applicable, the Labour Court. The authorities can examine the factual relationship, require the employer to produce records and issue orders concerning statutory compliance. Appeals may ultimately reach the Labour Court and Supreme Court according to the applicable procedure.

Nepal

Nepal Labour Act 2017 – Labour Outsourcing and Deemed Employment

Chapter 11 of the Labour Act regulates arrangements in which a licensed labour supplier provides workers to a main employer. Labour may only be supplied for prescribed work or services and through a licensed supplier. The labour supplier is generally responsible for employing and paying the supplied workers, while the main employer has statutory obligations concerning lawful engagement, workplace treatment, occupational safety and compliance monitoring. Most importantly, workers may be deemed employees of the main employer where they are obtained through an unlicensed supplier or are supplied in violation of the Act. This prevents organisations from using unlawful outsourcing structures to avoid direct employment obligations.

Nepal

Nepal Labour Act 2017 – Establishing an Employment Relationship

The Labour Act 2017 provides Nepal’s principal framework for determining whether an employment relationship exists. It does not establish a separate statutory test called “false self-employment.” Instead, classification follows from the broad definition of labour and the factual creation of an employment relationship. Section 12 provides that employment exists where an employer enters into an employment contract, employs a person verbally or engages a person in casual employment. A written agreement is generally required, but the absence of one does not necessarily prevent employment from existing. Where the parties dispute whether an employment relationship exists, the competent Labour Office, Department of Labour and Occupational Safety or court may determine the issue. If the employer fails to produce employment records after being ordered to do so, the relationship may be deemed established.