Market entry in Cambodia
Cambodia is a very enticing business destination for foreign corporations and investors looking to enter the SEA market. Although the Kingdom is often overlooked as a business port of call, its open economy, sound macroeconomic environment, central location, and the dynamism of its young and rapidly developing population should definitely appeal to business-minded opportunists looking to gain a foothold in the ASEAN and Greater Mekong sub-region. Read more
Cambodia allows for foreign companies to be established with 100% foreign ownership and without the legal requirement of a local partnership. Operating in a free market, Cambodia’s government also has no restrictions over product or service prices, granting full authority to the business owners.As the only country in Asia to adopt a dollarized-system, foreign businesses in Cambodia can easily earn profits in US Dollars and send it back to their home countries with no foreign exchange rates to interfere with the process.
Cambodia significantly observed one of the highest GDP growth rates in Southeast Asia, with an average of 7.03% over the past decade – which is extremely competitive even on a global scale. The Kingdom has also witnessed an extended inflow of foreign direct investment into the market over recent years, mirroring the shifting state of Cambodia’s developing economy, which is opening up more doors for lucrative business opportunities.
Establishing a company in Cambodia can be as a challenge with the ‘ease of doing business’ report ranking it as 144 from 190 nations, but since its rebirth in the 1990s, Cambodia has adopted a liberal foreign direct investment policy without bias or discrimination. The open-door policy offers guarantees, incentives and simplified investor friendly procedures, and there have been giant strides to expedite business registrations, tax payments etc. through online portals.
Our market entry practice follows a pragmatic approach:
• Business Eligibility Check allows you to quickly determine whether your business activity can be legally practised in Cambodia before engaging in any substantive cost. You can check the business feasibility here.
• Market Research to analyse industries, distribution channels as well as the size of the market potential for your products and services, and find business partners or investors.
• Entry Strategy to assess a realistic cost and estimate the revenue that your business activity could generate, determine the most suitable structure (100% foreign company or a joint-venture with a local partner) and get familiar with Cambodia’s business practices (HR, negotiations, culture & behaviour, etc.).
• Entity Creation which can be done online for private limited companies with the assistance of our corporate lawyers.
Depending on the maturity of your project, you can choose to start with any of these four steps. If you need more information or want to meet with our team in Cambodia, do not hesitate to contact us to discuss your specific business needs.
Soreasmey Ke Bin
Managing Director I Confluences
Cambodia Partner I Belaws
15.3 Million people
6.6 million tourists arriving yearly
GDP Growth : 7.1%
No restriction over foreign ownership business wise, except land acquiring.
Export Value: USD14.53 Billion
Import Value: USD20.52 Billion
Private Investment Projects: 197 Projects
Private Investment Value: USD8.16 Billion
Construction Permit Applied: 4,763 projects
Total Construction Value: USD11.4 Billion
Is my business activity possible in Cambodia?
Business feasibility check
Checking if the activity is restricted under the Law on Investment where some business licenses shall be granted by specific ministries governing those related field.
Is there a market for my service or product in Cambodia?
Market research in Cambodia
We have a team of local and international experts per industry who will analyze the chance of your product or service to succeed in Cambodia based on our deep knowledge of the local market. We assess the size of the market, the potential competitors and the legal or cultural limits to the development of your intended business activities.
Our experts have assisted clients with market research in numerous business activities including digital, telecommunications, infrastructure, food and beverages, etc.
What is the best structure to invest in Cambodia?
We determine the best structure for a successful implementation in the Cambodian market. Depending on your needs and the business activity:
• A soft structure with a local agent/distributor with some dedicated local staff or through a representative
office may be sufficient for a start.
• A complete structure with a 100% foreign-owned company, through a joint venture with a local partner
and/or with a holding company in Singapore or Hong Kong.
• A joint venture with a local partner.
Our entry strategy memorandum also includes the main tax implications, the protection of your investments (Intellectual Property, access to justice and arbitration, fund repatriation, etc.), information on Cambodian business practices and follow-up questions with our experts to ensure that you got it all clear.
Average time from the moment we receive complete information from you
** Starting price for simple matter
Cambodian Business structures
We assist you with the setting up of your entity in Cambodia as well as all ongoing accounting, tax and compliance matters.
Limited Liability Company
The limited liability company is the most commonly practised form of investment in Cambodia. The model is generally authorized in a subsidiary form of an investors’ offshore holding company.
The limited liability company can be 100 per cent Cambodian-owned, 100 per cent foreign-owned, or have any combination of Cambodian or foreign shareholdings. It is subject to certain restrictions.
There are three types of limited liability company available in Cambodia.
1. A single-member private limited company
2. A Private Limited Company
3. A Public Limited Company1. A single-member private limited company
2. A Private Limited Company
3. A Public Limited Company
Is an entity owned and operate by a single person. The sold proprietorship entitled to its profits and liabilities.
Representative oﬃces has a primary goal of sourcing local goods and services and collecting local information for the parent company. This form of a business vehicle also being used as a boat to promote and marketing the offshore parent’s products and services in Cambodia.
They are thus best suited in assisting foreign investors wishing to gain entry to the Cambodian marketplace.
A foreign or local entity may operate its business in Cambodia through a branch oﬃce. Although relatively common in the banking community, the government’s policy, historically, was to limit branches to foreign investors that have executed contracts with the government.
Such a limitation is not present under the current law. One notable consideration for branches is that the foreign parent company may be liable for the losses and debts of the branch. Branches cannot hold qualified investment projects (“QIPs”) and do not have separate legal personality from their principal parent company.
A “general partnership” is a contract agreement between more than one parties to combine their property, knowledge or activities to carry on a business with a common view of profit.
A ” Limited Partnership” is a contract between one or more general partners who are the sold persons authorized to administer and bind the partnership, and one or more limited partners, who are bound to contribute to the capital of the partnership.
Question Before You Begin?
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