Just days after implementing stricter oversight on real estate transactions, the government has reversed a directive requiring both buyers and sellers to submit bank statements.

The now-retracted provision—introduced on June 3 by the Department of Land Management and Archive—was part of an amendment to the ‘Directive on the Prevention of Money Laundering and Financing of Terrorist Activities, 2025’. It aimed to tighten financial scrutiny in land transactions and bring Nepal in line with international standards set by the Financial Action Task Force (FATF).

Read: Government Tightens Oversight on Real Estate Transactions to Curb Money Laundering

FATF placed Nepal on its grey list in February, citing deficiencies in financial transparency and anti-money laundering controls.

Under the original amendment, both parties in any land deal were required to submit Know Your Customer (KYC) documents and recent bank statements. Buyers also had to provide proof that payments were made via formal banking channels. Transactions exceeding Rs 30 million were to be reported to Nepal Rastra Bank. 

Read: Compliance Failures Result in FATF Graylisting

For advance agreements (baina), payments above Rs 1 million required banking proof. Sums between Rs 1 million and Rs 5 million had to be paid via bank or electronic transfer, while payments exceeding Rs 5 million were mandated to be made through electronic transfer or good-for-payment cheques issued in the seller's name.

However, the directive was revised on Sunday, June 8, following reported concerns from Prime Minister KP Sharma Oli.

Efforts to obtain a comment from the department’s spokesperson were unsuccessful at the time of publication.