(1) A foreign investor making investment pursuant to this Act may, for purposes of business related to its investment made in Nepal, execute a tripartite agreement (escrow-agreement) with its partner investor or other foreign investor and any such commercial bank or infrastructure development bank as recognized by the Nepal Rastra Bank.
Explanation: For the purposes of this Section, the term “escrow agreement” means an agreement by which the contracting parties agree to the effect that any amount, documentary evidence shall be handed over to any third party for the security of transaction between them or as a security for any guarantee, and such amount, documentary evidence or guarantee shall be provided to the concerned party after the completion of contractual obligations by the contracting parties.
(2) A bank executing an escrow agreement pursuant to sub-section (1) shall act as an agent of the parties to the agreement.
(3) Other provisions relating to an escrow agreement to be made pursuant to sub-section (1) shall be as prescribed.