Why now is still a good time to do business in Cambodia

Despite ongoing geopolitical tensions, Cambodia’s economic climate and prospects for growth remains strong.

Cambodia’s dynamic investment climate offers exciting opportunities for entrepreneurs, both local and international. Its steadily growing economy, expanding consumer market, highly dollarized economy, and preferential trade access through ASEAN, RCEP and various bilateral free trade agreements makes Cambodia a strategic location for business operations.

Further, the conclusion of the Agreement on Reciprocal Trade with the United States on 26 October 2025 significantly increases certainty in terms of applicable tariff rates, which is now set at 19% and is currently lower than China, Vietnam and Laos and is consistent with many other ASEAN countries such as Indonesia, Thailand, Malaysia, and the Philippines.

Expansion of major infrastructure projects such as the new Techo International Airport, Sihanoukville Autonomous Port, ongoing construction of the Funan Techo Canal as well as a number of major power supply and energy infrastructure projects and consistent renovations and construction of roads will support the growing economy by providing better structural support for businesses.

Other than that, the government is continuously rolling out new measures to support and attract businesses including investment incentives and tax benefits for qualified investment projects, digitalizing government approval processes such as the CamDX platform for business registration and adoption of regulatory reforms aimed at harmonizing with international standards and clarifying compliance requirements.

Key considerations for doing business in Cambodia

Once you’ve decided to pursue your business venture and tap into Cambodia’s market, successful business start-up requires proper registration to comply with legal requirements. Further, establishing a legitimate business entity protects your personal assets and interests, increases trust with business partners and can help unlock growth potential (such as through access to business loans).

The standard registration process for the business entities in Cambodia commercial incorporation and name registration with the Ministry of Commerce, tax registration with the General Department of Taxation, labor registration of the entity and its employees with the Ministry of Labor and Vocational Training, and social security registration with the National Social Security Fund. Other sector specific licenses may also be required depending on the nature of each business.

In terms of choosing the right business entity, the options include:

• Private Limited Companies (“LLC”)
• Public Limited Companies
• Sole Proprietorships
• Branches
• Representative Offices
• Partnerships

Each structure has different legal, tax, and operational implications. For example, representative offices are not permitted to regularly buy or sell goods, perform services, or engage in manufacturing, processing, or construction. Whereas branches can only carry out the business activities set out under the Articles of Incorporation (“AOIs”) of its parent company and has no separate legal personality from their parent company.

Among the options above, LLCs are the most popular due to their liability protections and flexible corporate requirements. Under Cambodian law, each shareholder is liable for the debts and liabilities of the company only to the extent of the shareholder’s subscribed capital. Further, the LLC’s shares may also be transferred in accordance with the law, subject to any restrictions as may be provided in its AOIs.

At Din & Co., we are happy to guide you through the registration process and provide ongoing compliance advice and support.