🇰🇭 Setting Up a Business Entity in Cambodia: A Step-by-Step Guide for Foreign Companies

Cambodia offers a pro-business environment with liberal foreign investment rules and competitive tax incentives. For foreign investors seeking to establish a presence, it's important to understand the entity types, registration steps, and compliance requirements.

Types of Business Entities in Cambodia

Foreign investors can choose from several structures depending on their goals:

1. Private Limited Company (Ltd)

• Most common structure for foreign businesses

• Can be 100% foreign-owned

• Requires at least 1 director and 1 shareholder

• Shareholder(s) can be foreign individuals or legal entities

2. Branch Office

• Extension of a foreign parent company

• Can engage in commercial activities

• Must appoint a local representative

• Liability is borne by the parent company

3. Representative Office (RO)

• Non-trading entity used for market research, promotion, and liaison

• Cannot issue invoices, generate revenue, or sign contracts

• Ideal for foreign firms exploring the market before committing

4. Joint Venture Company

• Partnership with a Cambodian firm

• May be required or advantageous in restricted sectors (e.g., landholding, natural resources)

• Governed by a shareholder agreement

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Step-by-Step Registration Process

Step 1: Name Reservation

• Submit proposed company name to the Ministry of Commerce (MoC)

• Ensure it’s unique and complies with naming rules

Step 2: Company Registration (MoC)

• Apply through Cambodia's Online Business Registration Platform (OBR)

• Required documents:

  • Articles of Incorporation

  • Identity/passport of shareholders and directors

  • Registered office address

  • Company objectives and shareholding structure

🕒 Timeline: Typically 7–15 working days

Step 3: Tax Registration (GDT)

• Register with the General Department of Taxation (GDT)

• Obtain:

  • Tax Identification Number (TIN)

  • Patent Tax Certificate

  • VAT Certificate (if applicable)

Step 4: Apply for Sector-Specific Licenses

Depending on your business, you may also need licenses from:

• Ministry of Industry, Science, Technology and Innovation (MISTI)

• Ministry of Posts and Telecommunications (MPTC)

• National Bank of Cambodia (NBC) for financial services

• Ministry of Health (MOH) for pharmaceuticals, etc.

Step 5: Open a Bank Account

• Required to deposit the minimum capital (typically USD 1,000+)

• Recommended banks: ABA Bank, ACLEDA Bank, Canadia Bank

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Compliance Requirements

• Annual Tax Return (due by March 31)

• Monthly Tax Filings (VAT, salary tax, WHT, etc.)

• Patent Tax Renewal (every January)

• Annual Declaration of Commercial Enterprise (ADCE) to MoC

• Maintain proper bookkeeping and audit records

Physical Office Requirement

• All business entities must provide a registered local address in Cambodia.

• For ease of operation and credibility, many foreign companies rent:

  • Serviced offices in Phnom Penh

  • Virtual offices for light operations

  • Spaces in Special Economic Zones (SEZs) for manufacturing/export firms

🛠️ Global Dealings can assist in finding reliable office providers and local liaisons.

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Investment Incentives (CDC/QIP)

Companies in certain sectors or sizes may qualify for Qualified Investment Project (QIP) status via the Council for the Development of Cambodia (CDC).

Benefits:

• Corporate tax holiday (up to 9 years)

• Import duty exemptions

• Export incentives