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Company Formation in Cambodia

Updated on Tuesday 24th October 2023

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Cambodia is a country in the Southeastern part of Asia with a growing economy that makes foreign investors choose it when wanting to open a company. It can provide many business opportunities for those who are interested in offshore company formation as well. 

Business entities in Cambodia

The first step in setting up a company in Cambodia is to choose what business entity type best suits your interests. There are several types, namely limited liability companies that can be public or private, representative or branch offices which are usually used for operations that are not commercial.
The private limited liability company is the type that foreign entrepreneurs most often prefer, given the fact that the public one only allows you to open either a financial establishment or a bank. For the private limited liability company, the requirements are as follows:
  • paying a capital of no less than $1,000 – here, it is important to mention that the authorities can ask for more if it is about a more complex kind of project;
  • at least 2 shareholders;
  • minimum 1 director.
Besides these, investors should expect the following when opting for company formation in Cambodia:
  • the procedure to open a company in Cambodia can take around 4 to 10 weeks, depending on the company type selected;
  • the set up of a corporate bank account can be completed in around 4 weeks (the bank account can generally be set up in several weeks, and this applies to an offshore bank account as well);
  • legal entities that are incorporated for commercial purposes are required to pay the corporate tax charged at the standard rate of 20%;
  • when hiring foreign workforce, investors will have to conclude specific immigration formalities for the issuance of work permits, and this can take around 3 to 6 months. 


Steps for registering a company in Cambodia

You need to open a corporate bank account where you deposit the necessary capital before opening a company in Cambodia. The bank account has to be opened on the country's territory.
The second step is choosing a suitable name for your company that has not already been used. This needs to be checked first and then you obtain an approval of the company's name at the Business Registration Department.
Then you need to incorporate the company with the Ministry of Commerce where you submit information such as corporate form, minimum capital, company name, notification of company establishment and names of the shareholders and directors.
You need to apply for an announcement of company registration in a mass-circulation newspaper. Furthermore, you will have to make a company seal issued by the Ministry of Commerce. Then, at the General Tax Department some documents need to be stamped, such as the certificate of incorporation or the Ministry of Commerce letter of approval.

What documents are required for company registration in Cambodia? 

There are different documents that have to be prepared for the registration of a local business, and they can slightly vary based on the company type investors have selected. However, for all businesses, the following are necessary: 
  1. the statutory documents of the legal entity (the articles of association for a limited company) which have to be drawn in English and Khmer;
  2. the personal documents of the company’s shareholders;
  3. the identity documents of the persons appointed as directors; 
  4. documents attesting the registered address of the legal entity (lease agreement or title deed);
  5. photos of the shareholders and directors (no older than 3 months). 

Foreign ownership in Cambodia

The law on foreign investments in Cambodia is created in order to facilitate the access of foreign investors on the local market. As such, the legislation allows the incorporation of a company with 100% foreign ownership, unless there are clear stipulations against it. 
In general, foreign investors have the right to set up their own businesses without having to include a Cambodian partner. This will be required in the case in which the company will own land in Cambodia, and in this case, the legislation requires local shareholding. 
Here, the Cambodian shareholding must be of at least 51%, limiting the foreign ownership to a maximum 49%. It must be noted that there aren’t any residency restrictions when appointing company directors. They can be of any nationality.

What are the basic certificates a company needs to function in Cambodia?

All businesses must obtain specific documents issued by the local authorities in order to have the right to develop a certain business activity, regardless of its type. These requirements cover all types of businesses, from the sole trader to the joint stock company and it also includes the representative office. 
It is mandatory to have a Certificate of Registration issued by the Ministry of Commerce (the procedure can be completed online). It is also required to obtain a Tax Certificate and a VAT Certificate, documents which are issued by the General Department of Taxation
All companies that sell goods or supply services must pay the VAT, unless there is an exemption granted under the applicable tax legislation. Currently, the VAT is charged at a rate of 10%, a rate charged for the import of goods as well. 
Depending on the field in which the company will carry its business activity, various permits and licenses will be required. For this, you can always rely on our team of consultants in company registration in Cambodia, who can help you apply and obtain all the necessary licensing. 
Please make sure that once you have registered with the Ministry of Commerce, it is mandatory to register for taxation with the General Department of Taxation within 15 days since the Ministry of Commerce issued its documentation.  
Investors have the possibility complete this step for company formation in Cambodia online on the website of the institution or in person – the latter can be completed by our team, provided that you grant us with the power of attorney.  
Finally, you have to notify the Ministry of Labor that you started hiring people as all businesses need to submit a declaration before their opening. Then you will also receive the inspector from the Ministry of Labor who has to conduct an inspection. If you want to set up a company in Cambodia, please contact our specialists for further information.