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Registering a company in Cambodia
14/12/2022
Setting up a company in Cambodia involves three main stages you will have to go through; the pre-registration stage, registration stage, and post-registration stage.
This article will provide some valuable background information about how to register a company in Cambodia.
Pre-registration
Pre-registration requires companies to complete several requirements before being able to register the company with the relevant authorities. These requirements include:
- Choosing a business entity,
- appointing company officers,
- renting an office and
- drafting the company’s articles of incorporation.
Choosing a suitable business entity
The first step a company must complete is choosing the right business entity for its needs. Cambodia offers the following entities for companies to choose from:
- Sole proprietorship
- Partnership
- Limited liability company
- Private limited company
- Public limited company
- Single-member private limited company
- Representative office
- Foreign branch office
- Subsidiary
Appoint the required company officers
In Cambodia, a private limited company is required to have a minimum of one director, and a public limited company must have at least three directors.
A private limited company must have 2 to 30 shareholders. It is also possible for one individual to form a single-member private limited company.
For more information, please take a look at our post on this topic here.
Registered Agent
A Cambodian company is required to appoint a registered agent who is a legally competent natural person and a resident of Cambodia.
Registered agents have the authority to receive official papers and documents from courts on behalf of the company.
Articles of association
Articles of Association are an essential aspect of company incorporation. Articles of Association determine how a company will operate and undertake specific procedures. The content contained in a company’s Articles of Associate is determined at the company’s statutory meeting and can be revised later with Shareholders’ meetings.
Examples of what should typically be included in the Articles of Association:
- Amount of authorised capital, issued capital and paid-up capital
- Company’s business activities
- Period of incorporation
- Purposes and objectives of the company
- The name of the company
- The domicile of the company
- The number of shares, shares classification (if any), number of shares for each classification, rights attached to each share, and nominal value for each share
- The name and number of the members of the board of directors and members of the board of commissioners
- The place and procedures for holding a general meeting of shareholders
- The procedures of appointment, replacement, and dismissal of the members of the board of directors and board of commissioners
- The procedure for profit utilisation and dividend distribution
Registered office address
Finally, the company must find and register an address for their office with the relevant authorities.
It is important to note that if the company is going to establish a presence in Phnom Penh, the company must register the address with the Phnom Penh Municipal Office. Whereas, if the office will be in Siem Reap, the company must register the address with the Siem Reap Municipal Office.
Documents to be submitted include:
- Application form to Mayor of Phnom Penh
- Copy of the company’s articles of incorporation (if a limited company)
- Copy of registration certificate
- Copy of business license from the Ministry of Commerce
- Copy of the identity card or passport of the person who signed the application
- Photo of the front entrance of the office
- Land title or lease agreement
Registration
Once you have completed the requirements listed above, you will be able to register your company with the government authorities.
Company incorporation with the Business Registration Department
The first stage of company incorporation is registering the business via the Online Registration Services under the Ministry of Economy and Finance’s (MEF) Cambodia Data Exchange (CamDX) system. To register online, you will need to create a user account, which requires a name, personal information, and contact details.
Once this has been completed, a company must choose and reserve a company name. The name must be in Khmer, but you can also have the name registered in another language such as English.
Reserving the company name costs KHR40,000 (USD 10). Once the name reservation has been paid for, the name will be reserved, and no other company will be able to use the name. Once approved, the name will be reserved for two weeks (from the approval date). If you want to extend the reservation period, you must make another payment to reserve the company name for another two weeks.
After the company name has been sorted, you will then need to choose your business activities according to the Standard Industrial Classification (SIC codes), submit the registered office’s lease agreement, and the required shareholder’s and director’s information.
The minimum capital of the company should be at least KHR 4 million (USD 1,000).
Once approval for the registration has been received from the MOC, you will receive the Certificate of Registration which can be obtained at the Department of Registration and issued online.
Registering a company in Cambodia usually takes 2 – 3 weeks.
The following documents must be uploaded when registered with the Ministry of Commerce:
- Land title or lease agreement of the enterprise’s location
- Current photo of no longer than three months of director, shareholder (if the shareholder is a physical person) and/or representative (if the shareholder is a legal entity) with white background
- National identification card or passport of director, shareholder (if the shareholder is a physical person) and/or representative (if the shareholder is a legal entity)
- Articles of incorporation in both English and Khmer
- Reference document (can be a letter specifying an already-existing company’s permission to use a similar company name, special licenses, and related documents)
- Authorization letter if the one who fills out the application is your representative
Post-registration
After you have completed the registration procedure above, the process isn’t quite finished as there are some post-registration compliances that you must complete.
This includes:
- collecting company seals,
- Tax registration,
- opening a corporate bank account and
- registration with the National Social Security Fund.
Company seals
After registering the company, you must obtain company seals from a seal maker. All company seals must be made in accordance with the format outlined by the MOC. Once you have received the company seal, the MOC will then register the company seal.
Have registration documents stamped and approved
Documents such as the articles of association and certificate of incorporation need to be stamped at the Department of Administration and General Affairs.
Tax registration
For a company to be able to register for tax, they must complete the application form from the General Department of Taxation on the registration service website.
The application form requires the following documents to be attached:
- Proof of paid property tax or property information of the enterprise
- Bank account information (must be provided in digital form within 15 working days after tax registration. Failure to do so would result in the revoke of the given certificates from GDT)
Opening a corporate bank account
An extremely important step is for the company to open a bank account and deposit the initial capital into the bank.
The company must also obtain a bank statement stating that the capital has been deposited. This statement must then be submitted to the online registration within fifteen days of receiving the certificate of incorporation.
Some popular choices of banks for companies in Cambodia are:
- ACLEDA Bank
- Canadia Bank
- Foreign Trade Bank of Cambodia
- Union Commercial Bank
- ANZ Royal
- Vattanac Bank
- Maybank Cambodia
- Advanced Bank of Asia Limited
Notify the Ministry of Labour and Vocational Training
Before a company is permitted to start its business operations, all companies must submit a written declaration to the Ministry of Labour and Vocational Training.
Companies with at least eight employees must have internal regulations that adhere to the general provisions of the labour law. Such provisions include the conditions of hiring, wages payment, benefits, work hours, health and safety measures, and personal leaves.
These internal regulations must be filed within three months of the company’s incorporation.
Register with the National Social Security Fund
Employers who have hired at least one employee are required to register with the National Social Security Fund (NSSF).
The employer needs to complete the Registration of an Enterprise and Registration of Employees form and file them with the NSSF together with the following required supporting documents:
- Company’s certificate of incorporation
- Patent tax certificate
- List of employees
- Identity card or passport of the company’s representative
After registration, the employer must file the monthly NSSF contribution by the 15th of every month.
Capital and foreign currency restrictions in Cambodia
While Cambodia’s national currency is the Riel (KHR), most transactions are made using US dollars.
The LCE establishes that a minimum number (1,000 shares) and price of shares (4,000 KHR or USD 1) is required. Therefore, the minimum required amount capital of for a company is 4,000,000 KHR (approximately 1,000 USD).
Cambodian companies may offer a number of classes of shares with various rights. However, certain licensed activities are required to meet higher capital requirements.
Transferring funds
There are no restrictions on transferring funds in or out of Cambodia. There are also no ordinary restrictions on foreign exchange operations as long as they are conducted through authorized intermediaries such as commercial banks.
Additionally, companies can easily buy foreign currencies through the local banking system.
However, any transfer of funds overseas with an equivalent value of (or more than) USD 10,000 must complete a prior declaration that is submitted to the NBC.
How can Belaws help?
If you need more information about corporate governance in Cambodia, you can talk directly with one of our experts.
To learn more about starting a business in Cambodia, why not take a look at our market entry services?
Please note that this article is for information purposes only and does not constitute legal advice.
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