Which Cambodian company structure should you choose

TL;DR

• 6 main structures in Cambodia: Co. Ltd. (95% of expats), Single Member Co. Ltd., PLC, sole proprietorship, branch, representative office.
• The Law on Commercial Enterprises (LCE) 2005 sets the rules; the CamDX single-window portal handles registration across all structures.
• Choose based on 3 criteria: number of shareholders, level of asset protection desired, and activity (commercial vs liaison vs foreign subsidiary).

Quick comparison

How to choose

Solo consultant / freelance

• Modest activity, revenue < 250M KHR/yr: sole proprietorship is enough. Setup cost USD 200-500, simple personal taxation.
• You want asset protection or invoice corporate clients who require a “company”: Single Member Co. Ltd.. Cost USD 800-1,500, CIT 20% on profits.

Commercial activity (e-commerce, restaurant, agency, retail)

• Co. Ltd. is the standard: minimum 2 shareholders (can be you + spouse, or you + partner), limited liability, min capital 4M KHR (~USD 1,000), 100% foreign allowed outside reserved sectors (land, media, local transport).

Subsidiary of a foreign group

• Just want prospecting / liaison without selling in Cambodia: Representative Office. No corporate income tax (no local revenue allowed), but no turnover possible. Ideal for 6-18-month exploratory phase.
• Want to operate commercially under the foreign parent’s name: Branch Office. CIT 20% on KH revenue. Legal liability flows back to parent — often avoided for that reason.
• Want a distinct Cambodian legal entity: Co. Ltd. with the foreign parent as sole or majority shareholder.

Large company, public fundraising

• Public Limited Company (PLC) is mandatory to issue shares to the public or list on the Cambodia Securities Exchange (CSX). Heavy compliance: ≥ 3 directors, external auditor mandatory, annual general meeting. Reserved for large players.

Quick decision table

Indicative costs compared (setup + 1st year)

International firms (DFDL, Acclime, VDB Loi): double the setup costs.

Available incentive regimes

All structures except sole proprietorship and representative office can request QIP (Qualified Investment Project) status from the CDC for CIT exemption 3-9 years, customs duties, VAT.

Reserved for projects > USD 100,000 in promoted sectors: manufacturing, resort tourism, processed agriculture, logistics. See the QIP detail in the Co. Ltd. guide.

Common pitfalls

FAQ

Which structure for a freelancer invoicing foreign clients from Cambodia?

If you are tax resident in Cambodia (> 183 days/yr, see tax residence) and your clients are abroad: Single Member Co. Ltd. is the right balance. You invoice in USD, profit is taxed at 20% CIT, you pay yourself a salary (personal ToS ~20%). If revenue < 250M KHR/yr and simplicity matters: sole proprietorship.

Is a branch taxed like a Co. Ltd.?

Yes in principle: CIT 20% on Cambodian-source income. But the base calculation differs (no local share capital, cost allocations from the parent scrutinised by GDT). In practice, plan for a firm to handle the transfer-pricing calculation.

I want to open a restaurant — which structure?

Co. Ltd. with 2 shareholders (you + partner or personal holding). The F&B sector requires specific licences (sanitary, alcohol if applicable, municipal signage) on top of MoC registration. Allow 3 months of total procedure, USD 5,000-10,000 in setup fees excluding premises and equipment.

Can I change structure later?

In theory yes, in practice it is heavy: dissolve the old (3-6 months) and create the new. To go from sole proprietorship to Co. Ltd.: “contribution in kind” possible but with asset valuation and TIN transfer. Almost always simpler to create the Co. Ltd. fresh and gradually wind down the sole proprietorship.

Does my EB visa change with the structure?

No. The EB visa and work permit are tied to your employment in a KH company (your own or an employer’s). Whether you are director of a Co. Ltd., PLC or Branch, the EB + work permit procedure is the same. See work permit.