A foreign business is considered to be “doing business” in Cambodia if the foreign business performs any of the following acts within the Kingdom of Cambodia:
- rents office or any other space for manufacturing, or processing, or performing services for more than one month;
- employs any person to work for it for more than one month;
- performs any other act that laws of the Kingdom of Cambodia authorized for foreign natural and legal persons.
In the event that the threshold for “doing business” in Cambodia is met, the foreign business will be required to register with the Ministry of Commerce and subsequently with the General Department of Taxation (GDT).
The most commonly used corporate vehicle for doing business in Cambodia is the limited company. The basic steps involved in incorporating a limited company in Cambodia are:
- Reserve company name online with Ministry of Commerce;
- Draft Memorandum and Article of Association of the company and submit to MOC with supporting documents to register a limited company or branch office in Cambodia;
- An authorized representative of the company establishes an account with a bank in Cambodia;
- Register the new entity with General Department of Tax following MOC approval and obtain Patent Tax certificate (estimate 1 month following MOC approval);
- Apply for license from the Ministry of Education (estimate 3 month following submission of a complete application)
- Register the new entity with the Ministry of Labor;
- Register the with relevant local authority (City Hall).
Foreign ownership of shares in a Cambodian limited company which engages in nearly any line of business is permitted – with the exception of legal entities which hold title to land in Cambodia. In this case, a majority (51% or more) of the company shares must be owned by person(s) having Cambodian nationality.
Certain additional licensing requirements may also apply depending on the particular business activity of the company.