Cambodia’s emerging economy and favorable policies for foreign investment make it an attractive location for business setup. Here’s a detailed guide to establishing a company in Cambodia.
1. Choosing the Right Business Structure
The primary structures for foreign companies are:
- Private Limited Company (PLC): Ideal for small to medium enterprises, offering limited liability protection.
- Branch Office: A foreign parent company can establish a branch to conduct business directly in Cambodia.
- Representative Office: For non-commercial activities like market research; not permitted to engage in profit-making.
A Private Limited Company is generally the best structure for foreign investors seeking limited liability and operational flexibility.
2. Company Registration Process
The Ministry of Commerce (MOC) handles company registration,which involves:
- Reserve a Company Name: Submit a name reservation request to ensure it is unique.
- File Incorporation Documents: Include Articles of Incorporation, office lease, and director and shareholder information.
- Obtain a Business License and Register for Tax: Register with the General Department of Taxation (GDT) for a tax identification number and other applicable licenses.
3. Minimum Capital Requirements
Private Limited Companies require a minimum capital of KHR 4million (about USD 1,000), though higher amounts may be necessary depending on the industry.
4. Tax Compliance and Accounting
Cambodia’s corporate tax rate is 20%, and businesses with annual revenue above KHR 125 million must register for VAT (10%).
5. Government Incentives
Cambodia provides incentives such as tax holidays and import duty exemptions for specific sectors, including manufacturing, tourism, and agriculture.
6. Conclusion
Cambodia’s accessible registration process and incentives make it an attractive option for businesses seeking entry into Southeast Asia.