QBiz Solution Co., Ltd.

Cambodia officially joined the Asean Economic Community (AEC) in December 2015. While it is still early to assess the impact the new membership has had on the country, we believe in the following years your startup could benefit from:

• Access to a market of over 600 million people (or almost 10% of the world population) in the ASEAN region.
• Lower transaction costs on trading, the import of materials by the elimination (or lowering) of tariffs and non-tariff barriers, as well as on the export of our final products.
• Advancements in processes for customs, logistics, and transport connectivity for trading.
• Access to skilled labour from other countries, as well as educational & comprehensive capacity building programs to train our existing staff.
• Access to ASEAN capital investment opportunities.
• Exchange of knowledge and improvement of processes to implement Good Manufacturing Practices, HACCP, Intellectual Property Rights, etc. For example, Cambodia has recently signed all three intellectual property treaties managed by WIPO: the Madrid Protocol, the Patent Cooperation Treaty, and the Hague Agreement Concerning the International Registration of Industrial Designs.
• With AEC membership we will see proper regulations and all the proper taxation put in place, making importing and exporting and other business-related activities much clearer and easier to understand. It will actually lower the price of a lot of goods here. For example, Cambodia recently abolished the estimated tax regime, forcing all enterprises to join the real regime.
• The country has recently signed Double Tax Agreements (DTA) with Singapore, China and Brunei, while a new DTA with Thailand is expected very soon.

• Cambodia also saw a 4 percent increase in new registered companies for the first three months of 2015.
• In 2014, almost 4,000 businesses registered with the Ministry of Commerce, marking a 29% increase on 2013.
• In addition, trademarks registered with the Ministry of Commerce rose from 4,199 in 2015 to 4,685 last year. The rise in registered trademarks follows Cambodia’s accession to the Madrid Protocol in 2015.
• The total number of active trademarks in the country exceeds 47,000.
• There were 513,759 non-street businesses in Cambodia as of 2014, however, only 10,565 of these are registered.
• Foreign firms are mostly operated by Chinese, South Koreans, Japanese and Vietnamese who are carrying out business in the garment, footwear, agriculture, agro-industry, tourism, construction and real estate sectors.
• 5,128 of the registered businesses operating in Cambodia are foreign owned. 2,028 of these are Vietnamese owned while 382 are US or European owned.
• These increases may also reflect the tightening of business registration requirements by the Cambodian Government and compliance with these laws across the Cambodian market.
• However, Cambodia is considered number 180 out of 190 countries on the Ease of Starting a Business, according to the World Bank Group, so challenges could be significant.
• Frequent challenges include a lack of access to information on regulations and licenses & permits needed for a specific industry and a lack of skilled labour.

• It boasts a relatively simple tax system offering several incentives, especially in select industries and those operating from a Special Economic Zone.
• Companies can be 100% foreign-owned.
• Offers duty-free avenues into the US and EU.
• Large, cheap workforce.
• Dollarised currency.
• Easy for businesses to move money in and out of the country.
• A hub for foreign businesses located in the heart of the ASEAN Economic Community (AEC).

• A valid visa, work permit and a bank account with a minimum balance of USD$1,000 (4 million riel) – you may withdraw this as soon as the business is officially established.
• A certificate of good health.
• More often than not, a police report from your home country identifying you as a person(s) of good standing with no history of criminal activity.

• To register a company in Cambodia the name must also be registered with the MoC.
• To receive the company’s constitutive documents—which include the certificate of incorporation, the Articles of Association, and the business license—you will need to register with the Ministry of Commerce (MoC). The process can now be carried online here.
• Within 15 calendar days of having registered with the MOC, the new enterprise must register with the GDT. At the GDT, you will obtain the tax patent and the VAT certificate of the new company.
• Finally, all enterprises must pay a visit to the Ministry of Labour and Vocational Training (MLVT), which registers the company under the Labour Law, provides workbooks for Khmer employees and work permits and employment cards for foreign workers. If the new company has more than eight employees, they must also be registered under the National Social Security Fund.
• The World Bank latest estimation is that it takes 99 days for the whole process to be completed.

• The first food franchise in Cambodia, operating in Phnom Penh, was Thailand-based The Pizza Company. Launched in 2005 by EFG (Express Foods Group), they have also introduced Swensen’s, BBQ Chicken, Dairy Queen and Costa Coffee.
• A number of international brands have entered the Cambodian market, including; Burger King, Carl’s Jr., Circle K, Cold Stone Creamery, Domino’s Pizza, Krispy Kreme, L’Occitane, Levi’s, Lotteria, Pandora, and Starbucks, and more.
• In 2016, electronics and gadgets seller, T-Shop, became the first Cambodian business to offer franchise options.
• In 2020, Cambodia does not have any comprehensive franchise laws; these are being worked on by the MOC.
• Stay up to date on Article 19 of the Trademark Law, Copyright, Competition and Intelectual Property Laws which are being reviewed and updated.