Cambodia company registration

DOING BUSINESS IN CAMBODIA


Since 2003, Healy Consultants Group PLC has been efficiently and effectively assisting our Clients with i) Cambodia business registration ii) business licensing iii) Cambodia corporate banking solutions iv) visa options and staff recruitment strategies and v) workspace rental solutions.

SummaryLLCFast business solutionFree zone LLCPublic limited companyRepresentative officeBranch office
Best use of company?All products and servicesClose a customer deal nowManufacturing and export tradingTo secure public fundingMarketing & researchSpecific projects
How soon can you invoice Clients/sign sales contracts?10 weeks4 weeks12 weeks14 weeks8 weeks8 weeks
How soon can you hire staff?10 weeks4 weeks12 weeks14 weeks8 weeks8 weeks
How soon can you sign a lease agreement?ImmediatelyImmediatelyImmediatelyImmediatelyImmediatelyImmediately
How long to supply corporate bank account numbers?14 weeks8 weeks16 weeks18 weeks12 weeks12 weeks
How long to supply company registration/tax numbers?10 weeks4 weeks12 weeks14 weeks8 weeks8 weeks
Standard corporate tax rate on annual net profits?20%20%0%20%0%20%
Government grants available?YesYesYesYesYesYes
Resident director required?NoNoNoNoNoNo
Tax representative required?YesYesYesYesYesYes
Recommended minimum paid up share capital?US$1,000US$1,000US$100,000US$1,000NoneNone
Corporate bank account location?Acleda BankANZ Royal Bank CambodiaCathay United BankBOC CambodiaANZ Royal Bank CambodiaAcleda Bank
VAT payable on sales to local customers?10%10%10%10%None10%
Average total business set up engagement costs?US$14,185TBDTBDUS$14,185US$15,685US$15,685
Average total engagement period?16 weeks16 weeks18 weeks20 weeks16 weeks16 weeks

See full table

Accounting and tax considerationsLLCFast business solutionFree zone LLCPublic limited companyRepresentative officeBranch office
Statutory corporate tax payable?20%20%0%20%0%20%
Legally tax exempt if properly structured?NoNoYesNoYesNo
Must file an annual tax return?YesYesYesYesYesYes
Must file annual financial statements?YesYesYesYesYesYes
Must appoint an auditor?NoNoNoYesNoNo
Access to double taxation treaties?YesYesYesYesNoYes
Withholding tax on payments to foreign shareholders?14%14%14%14%None14%
Company RegistrationLLCFast business solutionFree zone LLCPublic limited companyRepresentative officeBranch office
Minimum number of shareholders/partners?1111Parent companyParent company
Minimum statutory paid up share capital?US$1,000US$1,000US$1,000US$1,000NoneNone
Shelf companies available?YesYesNoYesNoNo
Time to incorporate a new entity?10 weeks4 weeks12 weeks14 weeks8 weeks8 weeks
Can easily convert to a PLC?YesYesYesYesNoNo
Public register of shareholders and directors?YesYesYesYesNoNo
Can have preference shareholders?YesYesYesYesNoNo
Business ConsiderationsLLCFast business solutionFree zone LLCPublic limited companyRepresentative officeBranch office
Good entity for trademark registration?YesYesYesYesNoYes
Can secure an import and export license?YesYesYesYesNoYes
Limited liability entity?YesYesYesYesNoNo

Sponsorship by a local citizen required?No
Our Client needs to travel to Cambodia for business set up?No
Temporary physical office solutions available?Yes
You need a local resident as bank signatory?No
Can be wholly foreign owned?Yes
Security deposit to be kept with Government?No
Government approval required for foreign owners?No
Can bid for Government contracts?Yes
Can secure trade finance?Yes
The entity will likely be regulated by?Ministry of Commerce
Maximum shareholding for foreigners?100%
Minimum number of directors/managers?1
Group HQ tax incentives?No
Monthly VAT reporting to the Government?Yes
Must sign an office lease agreement during incorporation?Yes
Shareholders & directors documents to be attested/translated?Yes
Each foreign director needs a personal income tax number?No
Foreign non resident director needs a residence visa?No
Maximum number of staff allowed?No maximum number for any entity
Expatriate percentage?10%
Can secure residence visa for business owner?Yes
Other useful information
What will be included in my customer sales invoice?Click link
This country has signed free trade agreements?Yes
This country is a member of WIPO/TRIPS?Yes
This country is a member of the ICSID?Yes
Average custom duties suffered?9.0
Government foreign investment approval required?No
Average monthly office rental? (US$ per sq m)20
Minimum statutory monthly salary?153
Average monthly US$ salary for local skilled employees?340
US$ deposit interest rate? (1 year average)1.4
Overseas remittance currency controls?Yes
Banking considerations
Multi-currency bank accounts available?Yes
Corporate visa debit cards available?Yes
Quality of e-banking platform?Good
Crowd funding available in this country?Yes

Press the link headings below to read detailed, relevant, up to date information.

  • Advantages and Disadvantages

    Advantages of Cambodia company registration

    Cambodia business registration advantages

    1. A Cambodia limited liability company can be established with only i) two shareholders ii) one director, who all can be foreigners and do not need to be residing in Cambodia to complete the procedures. Registration of a Cambodia company only requires US$1,000;
    2. The Government’s Qualified Investment Project (QIP) offers resident companies incentives, including:
      • 100% corporate tax exemption for up to nine years;
      • No price controls on investors’ products or services;
      • Duty-free imports of production equipment and materials;
      • Ability to have a long-term lease on land (50 year term with a 50 year extension);
      • 40% special depreciation allowance on the value of new assets used in manufacturing and processing.

    Disadvantages of Cambodia company registration

    1. Doing business and invest in Cambodia can be difficult because:
      • It can take up to four months to complete registration of a company in Cambodia and get its business licenses approved;
      • Before starting a new company in Cambodia, its owners must sign a lease for physical office space. A registered address only is disallowed and a government inspection of the company premises will be conducted;
      • It takes on average no less than two years to obtain a construction permit in Cambodia, to be compared with an average of less than 5 months in other Asia-Pacific countries;
      • Application for electricity connection takes an average of 6 months to be reviewed by Electricite du Cambodge, the sole national electricity provider in Cambodia. Frequent power cuts furthermore increase production downtime, according to the Foreign Business Leader survey;
      • Cambodia lacks proper waterway infrastructure, making it more expensive to transport commodities in comparison with other South-East Asia countries;
      • According to the Global Competitiveness Report 2014-15, roads and railways in Cambodia are highly underdeveloped;
      • For all reasons listed above, Cambodia is ranked as the 6th most difficult place to run a business in Asia Pacific by the World Bank.

    2. Companies are subject to a corporate tax rate of 20% on their global earnings in Cambodia and the country has not signed yet any double taxation avoidance treaty with other countries;
    3. It is hard to find skilled labor in Cambodia, because:
      • Only 10% of the population speaks English;
      • Internet literacy rate in Cambodia is only 5%;
      • Only 5% of the population enters tertiary education;
      • It takes three to six months to obtain work permit for a foreign professional.

  • Best uses for a Cambodia company

    1. Cambodia is an excellent place to setup a manufacturing company in Southeast Asia, because:
      • Cambodian companies can export their goods free of duty customs to most main consumers markets worldwide. Several countries have indeed granted duty free access to Cambodia, including: i) the United States ii) the European Union iii) Japan iv) Australia v) New Zealand vi) China and vii) Turkey, as well as all the ASEAN countries;
      • Companies incorporated in one of Cambodia’s four free trade zones are exempt from i) import and export duties ii) income tax for up to 9 years and iii) VAT;
      • Average monthly wage for skilled labor in Cambodia is US$800. Minimum monthly salary is only US$128;
      • Average monthly rental for warehouses is only US$0.2 per sq. m.;
      • There is no foreign exchange controls to hinder repatriation of funds from Cambodia;
      • Because of the above, the textile industry has boomed in Cambodia, with over 300 factories located in the country working for international textile and garments corporations.

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Company registration

  • Time to incorporate: Eight weeks
  • Cost to set up: US$13,185
  • Minimum capital: US$1,000
  • Physical office required: Yes

Required appointments

  • Shareholders: 2
  • Directors: 1
  • Company secretary: Yes
  • Resident director: No

Key facts

  • Corporate tax rate: 20%
  • Corporate tax base: Worldwide
  • Shelf companies: Unavailable
  • Main company type: Limited company

Frequently asked questions

Contact us

For additional information on our company registration services in Cambodia, please email us at email@healyconsultants.com. Alternatively please contact our in-house country expert, Mr. Simon Guidecoq, directly:
client relationship officer - Simon