Can I be director of the company registered in Nepal for any number of years or reelected for any number of terms?
It depends.
The appointment and tenure of directors are typically determined by the company’s articles of association or by the shareholders’ agreement, if any. The articles of association may specify the term of office for directors, including provisions for reappointment or retirement. Companies often have staggered terms or rotational systems for directors to ensure continuity and smooth functioning of the board.
The term of office of a director of a private company is as provided in its articles of association. So, it can be for any number of years. (Sec 90)
The term of office of a director of a public company is as specified in its articles of association, which shall not exceed four years.
There are 3 conditions where the restriction does not apply.
- Director appointed by the Government of Nepal or a corporate body shall hold the office for any number of years, as long as the Government of Nepal or the appointing body desires.
- The directors appointed by the promoters before the first Annual General Meeting (AGM) and the directors appointed by the Board of directors (if the director appointed by AGM is vacated for any reason) shall hold office only until the holding of the AGM.
- If a director’s office becomes vacant before the completion of their term, the term of the newly appointed director will only be for the remaining duration of the original director’s term. In other words, the newly appointed director will serve for the remainder of the tenure of the director whose office became vacant.
Retired directors on expiry of their tenure of office are eligible for reappointment to the office of director.
