Setting Up a Company in Cambodia
Cambodia offers 100% foreign ownership for most activities, competitive tax incentives through the QIP regime, and a dollarised economy that eliminates foreign exchange risk for USD-denominated businesses.
Cambodia has grown rapidly on the strength of garment exports, tourism and construction. The Law on Investment (2021) replaced the 1994 law, streamlined the Qualified Investment Project (QIP) regime and kept Cambodia's headline corporate tax rate among the region's lowest. The economy is substantially dollarised — USD is freely used for commercial contracts and banking — making it unusually accessible for foreign investors.
Key facts for 2026
| Parameter | Detail |
|---|---|
| Corporate income tax | 20% (standard rate) |
| VAT | 10% (standard rate) |
| Foreign ownership | 100% for most activities (land ownership restricted) |
| QIP tax holiday | 3–9 years (plus 50% reduction period) based on activity and location |
| Currency | USD freely used; KHR also official |
Qualified Investment Project (QIP)
A QIP is a designation granted by the CDC for investments meeting minimum capital or employment thresholds (typically USD 300,000 for most activities). QIP status unlocks a tax holiday of 3–9 years depending on sector and zone, followed by a 50% profit tax reduction for a further period, plus customs duty exemptions on imported equipment and raw materials used in production. Manufacturing, agro-industry, tourism infrastructure and technology companies are the most common QIP beneficiaries.
Land ownership — key restriction
The Cambodian Constitution prohibits foreigners from owning land. Foreign investors can hold land through long-term leases (up to 50 years, renewable), through a LMAP-registered Cambodian-majority joint venture, or through co-ownership structures. The prohibition applies to residential and commercial land. Condominiums above the ground floor can be 70% foreign-owned under the 2010 Foreign Ownership Law. This is the primary ownership constraint in Cambodia and requires careful structuring.
The incorporation process
- Register the company with the Ministry of Commerce (MOC) — online through the Business Registration System; typically 1–3 business days.
- For QIP status: file an investment proposal with the CDC or provincial investment subcommittee.
- Register with the General Department of Taxation (GDT) for CIT and VAT.
- Obtain a Patent Tax certificate (annual business licence) from the GDT.
- Open a corporate bank account; notify the National Bank of Cambodia of incoming foreign investment.
Frequently asked questions
Can a foreigner own 100% of a Cambodia company?
Yes, for most business activities — shares in a Cambodian company can be 100% foreign-owned. Land ownership is prohibited for foreigners; leasehold structures are used instead.
What is the corporate tax rate in Cambodia?
20% standard rate. QIP-registered entities receive a 3–9 year tax holiday followed by a 50% reduction period.
Why is Cambodia's dollarisation an advantage for foreign investors?
Because business contracts, bank accounts and invoicing can all be in USD without conversion risk. There is no requirement to use KHR for commercial transactions, and repatriation of USD profits faces no currency conversion step.
Official sources
- Council for the Development of Cambodia (CDC)
- Ministry of Commerce — Business Registration
- General Department of Taxation (GDT)
This guide is general information prepared by ARM Management and is current as at July 2026. It is not legal advice. Confirm with CDC or an advisor before incorporating.