FNCCI submits recommendations to govt to amend the Constitution and protect businesses

KATHMANDU: Federation of Nepalese Chambers of Commerce and Industry (FNCCI) on Tuesday submitted recommendations to the government calling for constitutional amendments to boost sustainable economic growth and improve the investment climate. The proposals also aim to strengthen business security for the private sector.

According to FNCCI President Anjan Shrestha, the federation wants a constitutional provision that formally recognises private sector as a partner in nation building and removes practical obstacles created by current constitutional arrangements. “FNCCI has given suggestions including ensuring a liberal economy with social justice in the preamble to make it a competitive, open-market economy with social justice, maintaining further clarity on the right to property under Article 25 of the constitution, and arranging for a commercial court within the Supreme Court,” Shrestha said.

The submission calls for the preamble to replace “socialism-oriented” with wording committing the state to a 'competitive, open-market economy with social justice.' FNCCI proposes removing the three-pillar economic policy and the socialism-oriented system and adopting a liberal, inclusive economy that emphasises innovation and public‑private partnerships.

The federation also seeks constitutional recognition of public‑private partnership (PPP) as a central mechanism for development and explicit mention of the private sector as the 'major partner of national economic development' within the directive principles. It recommends clearer guarantees for business property and investment security under those principles.

On property rights, FNCCI proposes that property acquired for public interest or national priority be taken only after payment of fair market value, with an independent evaluation committee to review valuations. The federation wants the right to industry and business security included under Part 3, Fundamental Rights, and stronger protections for the privacy and security of private property.

FNCCI urged the establishment of a commercial court within the Supreme Court to handle business disputes. It also raised concerns about trade union rights under Article 34 and recommended that trade unions operate independently of political parties and be governed by an autonomous body.

Tax and regulatory reforms form part of the submission. The federation called for amendments to the tax jurisdiction of local levels under Article 228, a single‑window system for tax licences, and measures to remove overlapping and multiple taxes and fees imposed by provincial and local governments. FNCCI suggested that paying tax to one entity should exempt businesses from paying the same tax to another, and that permits issued by one authority should remove the need for duplicate permits.

The recommendations further propose changes to land ceiling rules for industry and real estate, special arrangements for use of natural resources such as forests and mines, and a restructuring of the current three‑tier governance system, which has led to unsustainable recurring expenditure, duplication of work and unclear jurisdictions.

On legal procedures, FNCCI recommended that investigations into business irregularities and financial embezzlement be completed before prosecution proceeds, favouring financial penalties over criminalisation in many cases. It called for anticipatory bail provisions and a system that prioritises hearings before detention. To address business failures, FNCCI urged enactment of an Insolvency Act to provide an exit mechanism for industrial entrepreneurs whose businesses suffer losses or close.

The suggestions were presented at a meeting with the committee preparing a debate paper for amendment of the Constitution of Nepal, 2072. The government committee has not yet announced a timeline for considering the proposals.