(1) The Government of Nepal may declare a municipality, sub-metropolitan city or metropolitan city based on the fulfillment of the following conditions and facilities in consultation with the concerned local level and provincial government:-
(a) Municipal
(1) having at least ten thousand permanent residents in the Himalayan region of the Himalayan district, at least forty thousand in the mountainous region and hilly districts of the Himalya district, at least fifty thousand in the inner Madhesh district, at least seventy-five thousand in the Terai district and at least one lakh in the district within the Kathmandu Valley, Explanation: For the purposes of this section "Himalayan District, Hill District, Inner Madhesh, Terai District and Kathmandu Valley District" means the districts mentioned in Schedule-1.
(2) The average annual domestic income of the last five years is at least one crore rupees in case of Himalayan region and at least three crore rupees in case of other districts,
(3) Having roads, road belts, electricity, drinking water, communication and other minimum urban facilities,
(4) Waste management and proper disposal of landfill sites,
(5) Open areas and parks as specified in each ward,
(6) having hospital facilities of at least twenty-five beds,
(7) Having a bus park with passenger rest areas and public toilets (8) Provision of drinking water and sanitation (9) Having services of banks and financial institutions,
(10) Community building and meeting hall,
(11) having a market area,
(12) Having a slaughterhouse,
(13) Having a crematorium,
(14) Having a playground,
(15) City master plan prepared,
(16) Fulfillment of other criteria as specified and having other urban facilities.
(b) Sub-metropolitan
(1) having at least two lakh permanent residents,
(2) Annual average domestic income of at least twenty five crore rupees for the last five years,
(3) having hospital facilities of at least two hundred beds including one hospital of at least one hundred beds,
(4) Having a solid waste treatment and management system,
(5) Having a meeting hall,
(6) National level theatres, gymnasiums and covered hallsHaving a law,
(7) Availability of electricity, water and communication services (8) Major roads within the city are paved,
(9) Having the facility of high level education and technical education,
(10) Provision of public gardens and town hall (11) Having a modern slaughterhouse and an organized crematorium,
(12) Places and buildings of public use are handicapped friendly and physically accessible (13) having tourist level hotels, motels and resorts,
(14) Having other infrastructures assigned to the municipality,
(15) Having other urban facilities as specified.
(c) Metropolitan Municipality
(1) Having at least five lakh permanent residents,
(2) The average annual domestic income of the last five years is at least one billion rupees,
(3) Bus park with terminal, adequate facilities for parking, subway and road box,
(4) Urban transportation facilities and disability-friendly public transport facilities,
(5) At least seventy-five percent of the total road length is paved,
(6) Having an institution of study up to postgraduate level,
(7) Hospitals with specialist services, having hospital facilities of at least five hundred beds including at least one general hospital of one hundred beds,
(8) Having an organized vegetable and fruit sales centre,
(9) Having shopping malls,
(10) Having a stadium suitable for conducting international level sports,
(11) Having easy access to international airport transportation,
(12) Arrangement of international level meeting hall and international level business exhibition place,
(13) Having a museum,
(14) having a technical school,
(15) Having international standard hotel facilities,
(16) Protecting the heritage of the special Mahaivva within its territory,
(17) having adequate recreational facilities,
(18) Having children's gardens and senior citizens' recreation facilities,
(19) having dance halls and creative galleries,
(20) Having urban greenery and beauty,
(21) Having other urban facilities as specified.
(2) Notwithstanding anything contained in sub-section (1), existing at the commencement of this ActA municipality, sub-metropolitan municipality or metropolitan municipality shall be deemed to have been established in accordance with this Act.