Legal due diligence is a methodical legal investigation into a company or asset (like land) before an investment or acquisition. It aims to uncover legal risks and verify the seller’s claims.

It prevents investors from inheriting hidden liabilities, such as unpaid taxes, lawsuits, or illegal employment practices, which could otherwise result in financial loss or business closure.

Key documents include the Certificate of Incorporation, MOA/AOA, tax clearance certificates, land ownership (Lal Purja), material contracts, and employee registers.

Foreign investors, banks, private equity firms, and any company looking to merge with or acquire another business in Nepal and companies or corporate house. 

Common risks include defective land titles, lack of required environmental permits, non-payment of social security, and undisclosed cases.

While not explicitly compulsion by law, it is a practical necessity for obtaining NRB and Department of Industry (DOI) approvals, as these agencies require clean documentation for investment inflow.

Costs vary based on the project's complexity and the volume of records. Most firms provide a quote after an initial scope assessment.

Yes, by identifying issues early, you can demand that the seller rectifies them before closing or include protective  clauses in your contract.