Law Digest 2026

Commerce

The MOC recently released a progress report on the outcomes of the issuance of Prakas No. 117 dated December 9, 2025 on business registration reforms and Notification No. 0051 dated January 8, 2026 on penalty waivers for lack of compliance with annual declaration requirements. Essentially, the MOC is moving to modernize how companies are registered while offering a waiver of some penalties for companies that have failed to file their annual declarations.

Outcome of the penalty waiver for failure to file annual declarations under Notification No. 0051

The MOC confirmed a positive outcome so far and reported encouraging participation from the business community.

To date, 224 companies have submitted applications for the penalty waiver. In addition, 498 shareholders have voluntarily participated in background checks on natural persons, a measure introduced to enhance transparency and strengthen anti-money laundering compliance within the business registration framework.

Through this verification process conducted via the Dow Jones watchlist screening system, nine shareholders were identified as being on a monitoring list. These individuals were subsequently requested to remove their names from the business registration system.

In the press release, the MOC included a reminder that compliant companies can continue to file their annual declarations within the same timeframe as the patent tax payment process at the General Department of Taxation, which occurs between January and March each year.

Outcome of business registration reforms under Prakas No. 117

The MOC also reported positive developments regarding business registration.

Business registrations conducted through the CamDx system increased by 9.3% in January 2026 compared to January 2025, indicating a growing demand for new business registrations in Cambodia.

Clarifications on the company secretary requirement

In light of the increase in new business registrations and to facilitate a smoother transition for companies, the MOC announced that the implementation timeline for the company secretary requirement has been extended until January 2027.

It also provided clarification on the company secretary requirement. Pursuant to the Law on the Amendment of the Law on Commercial Enterprises, together with Prakas No. 117, it applies only to limited liability companies. It does not apply to:

• Sole proprietorships
• Startups
• Informal economy groups
• Small and medium-sized enterprises

In addition, limited liability companies can appoint any individual as its company secretary without them having to meet the specified qualifications. However, individuals who intend to provide company secretary services professionally to multiple companies must comply with the qualification conditions set out in Article 25 of Prakas No. 117.

Upcoming Prakas on business registration guidance

To further facilitate and provide additional guidance to the private sector, the MOC is currently preparing a draft Prakas that will formally recognize its Business Registration Handbook, which supplements the existing regulatory framework by providing practical guidance on business registration procedures and compliance with standard operating procedures.

Banking and Finance

To address the growing need for effective management of distressed assets, the NBC has established legal and operational requirements for institutions that specialize in the acquisition and management of non-performing loans (“NPLs”) and related collateral from banks and financial institutions. The Prakas aims to enhance financial stability by facilitating the effective resolution of distressed loans while ensuring proper oversight and governance of institutions involved in this activity.

Permitted and prohibited activities

Licensed Asset Management Institutions (“AMIs”) can engage in several activities related to the management and recovery of distressed loans, including:

• Acquiring and managing NPLs and related collateral from Banks and Financial Institutions (“BFIs”).
• Acquiring and managing debtor assets through court-ordered auctions, provisional administration, or liquidation processes.
• Providing debt collection services to BFIs.
• Facilitating the sale of collateral with the debtor’s consent.
• Selling loans to BFIs or other AMIs.
• Conducting other activities permitted by the NBC.

However, AMIs are prohibited from engaging in certain financial activities, including:

• Providing loans or refinancing services.
• Providing loan guarantees.
• Acquiring NPLs from BFIs that have extended lending facilities to the AMI.
• Conducting other activities prohibited by the NBC.

Formation and capital requirements

To obtain a license, an AMI must be established as a public limited company and maintain a minimum registered capital of KHR200 billion. Before commencing operations, an AMI is required to deposit an amount equal to 100% of its registered capital into an account with the NBC. In addition, the AMI must deposit with the NBC an amount equal to 5% of its registered capital as a capital guarantee.

To obtain a license, applicants must submit comprehensive documentation to the NBC, including corporate information, governance structure, shareholder details, business plans, strategies for NPL acquisition and management, internal audit procedures, and details on its consumer complaint resolution mechanism.

Licensing and regulatory approval

The NBC will review license applications and notify applicants of its decision within six months of the date of application submission. Licenses granted to AMIs are valid for five years and may be renewed, provided the renewal application is submitted at least six months prior to the license’s expiration date.

AMIs are required to obtain prior approval from the NBC for significant corporate changes, such as:

• Changes to the institution’s name or address
• Changes in registered capital
• Amendments to the articles of incorporation
• Changes in directors or senior management

BFIs that intend to acquire or hold equity interests in an AMI must obtain prior written approval from the NBC to do so.

Official fee

Licensed AMIs must pay an annual license fee of KHR50 million, which must be paid before January 15 each year. For institutions that receive their license during the year, the payment structure is adjusted depending on the timing of approval:

• Institutions licensed during the first half of the year must pay the full annual fee,
• Institutions licensed during the second half of the year pay only half of the annual fee.

In addition to the annual license fee, AMIs are required to pay several administrative fees, including:

• Information request fee: KHR500,000
• License processing or renewal fee: KHR2.5 million
• Fee for changes to the articles of incorporation: KHR1 million per page
• License amendment fee: KHR2 million
• Share transfer or capital increase fee: 0.5% of the value of the shares transferred or the increase
• Decrease in capital fee: 1% of the value of the decrease in capital

Acquisition and transfer of NPLs

AMIs must acquire NPLs from BFIs through transparent and arm’s-length transactions at prices mutually agreed upon by the parties.

Once an NPL is transferred, the AMI assumes the rights and obligations of the creditor, including the right to enforce claims against debtors and guarantors and to manage or dispose of associated collateral. When transferring NPLs, BFIs must obtain prior approval from the NBC and provide relevant documentation such as board resolutions, a letter requesting approval for the NPL sale, and valuation reports.

BFIs must also transfer all related loan documentation and notify customers and credit reporting service providers of the transfer of the NPLs.

Supervision requirements

AMIs shall submit quarterly reports to the NBC, including financial statements and reports on NPL portfolio performance and recovery activities, no later than the 15th day of the first month of the next quarter.

AMIs also submit annual audited financial statements no later than April 30 of the following year. If an AMI fails to comply with these requirements, it shall be subject to a transactional fine of KHR1 million per day.

AMIs shall maintain all transactions and records for at least 10 years following the final resolution of the relevant NPLs and associated collateral.

Governance requirements

All AMIs shall have a board of directors consisting of at least five members, including at least two independent members.

Board members and senior management shall have the appropriate qualifications, experience in banking or financial systems, and knowledge of the relevant regulations. Individuals convicted of serious financial or criminal offenses, including fraud, theft, money laundering, or bankruptcy-related misconduct, are prohibited from holding these positions.

Fines and license enforcement

The NBC may impose fines as follows;

• Failure to comply with this Prakas (other than supervisory requirements, which are covered separately): A transactional fine of KHR 3 million per day.
• Failure to comply with an injunction or breaching of other relevant regulations: A fine of KHR1 million per day.

Failure to start operations within six months of licensing, violating laws, becoming insolvent, or voluntarily ceasing operations: Suspension or revocation of the AMI’s license.

Real Estate

Under this Prakas, the MLMUPC introduces a comprehensive framework that mandates the strict regulation of elevator systems across Cambodia to safeguard lives and property. It applies to all types of elevators used in buildings and other structures, including passenger or freight lifts, escalators, and moving walkways.

Elevator use certificate requirement

Under this Prakas, elevators can only be used after obtaining an elevator use certificate issued by the MLMUPC. The application must be submitted through the ministry’s Single Window Service and may be filed either separately or together with the certificate of use of the building in which the elevator is installed. While multiple elevators within the same project can be included in a single application, a separate certificate will be issued for each elevator.

Application documents and procedure

Applicants must submit an application package that includes:

• An application form for the elevator use certificate
• The applicant’s identification documents
• Construction permit and site opening permit (if available)
• Technical documents, including an inspection and report of the elevator installation works

The MLMUPC shall examine the application and decide within 21 working days from the application submission date. If approved, an elevator use certificate shall be issued and delivered to the applicant within two working days from the date of the ministry’s decision.

Validity and periodic safety inspection

The elevator use certificate has indefinite validity. However, building owners must ensure that elevators undergo quality and safety inspections by licensed elevator inspectors every two years. The inspection must confirm that the elevator system remains compliant with technical and safety standards.

Following inspection, the MLMUPC shall issue an elevator quality and safety certificate, which will be recorded in the digital elevator data management system maintained by the ministry. Where technical defects are identified during inspection, the building owners are responsible for arranging for repair or modification before the safety inspection report can be issued.

Compliance measures and enforcement

The MLMUPC shall issue a written warning to building owners in cases where elevators are operated without periodic safety inspections or where technical defects are identified.

Failure to comply with the warning or respond within the specified timeframe shall result in the suspension of the elevator use certificate, during which the elevator must not be used.

In more serious cases, including where the elevator is dismantled, replaced entirely with a new system, or where the safety system is permanently defective and cannot be repaired, the elevator use certificate shall be revoked.

Transitional requirement

For elevators already in operation before the entry into force of this Prakas, building owners are required to apply for an elevator use certificate within one year in accordance with the procedures. Failure to comply after this transitional period shall result in enforcement actions under the construction laws in force.

Real Estate

This Sub-Decree establishes a comprehensive legal framework to strengthen security, public order, and social safety in collective living environments throughout the Kingdom of Cambodia.

Scope and Application

It applies to all collective living areas, whether public or private, including boreys, condominiums, apartments, co-ownership buildings, factories, enterprises, farms, special economic zones, hotels, guesthouses, dormitories, religious institutions, orphanages, and similar residential settings across Cambodia.

It imposes legal obligations on heads of units, owners, managers of collective living areas, residents, and private security service providers. Residential areas under the Royal Cambodian Armed Forces and the National Police are excluded from this scope.

Competent Authorities

The Ministry of Interior (“MOI”) is the primary authority responsible for leading implementation. It delegates operational responsibilities to the administrations of the capital, provinces, cities, districts, and khans, which are accountable for accommodation management and the enforcement of security and safety measures within their respective jurisdictions.

Security and Safety Measures

The competent authorities are responsible for:

• Conducting regular administrative inspections of collective residential areas;
• Arranging, supervising, and inspecting security protection systems, including CCTV systems, fire prevention, and access control mechanisms.

The owners, managers, and heads of units of collective living areas are required to:

• Maintain accurate and up-to-date resident records, in paper and/or electronic form;
• Report any changes in residency to the local authorities in a timely manner;
• Submit resident lists, identification documents, and accommodation-related records upon request;
• Report the temporary presence of foreigners within 24 hours to the competent authorities;
• Cooperate fully with administrative inspections conducted by competent authorities;
• Verify foreigners’ legal entry and residence documents before permitting residence;
• Prohibit the residence of foreigners who have entered the Kingdom of Cambodia illegally;
• Report suspicious individuals or activities that may pose security or safety risks.

Foreigners holding a valid permanent residence permit from the MOI must report and register their residency within 48 hours of receiving the permit, while other foreign residents in a Concentrated Residential Area must register their residency in compliance with applicable laws and regulations.

All security camera data shall be retained for a minimum of 90 days, and records of movements into and out of the Concentrated Residential Area shall be maintained for a minimum period of 1 year. Furthermore, these data and records shall be provided to competent authorities upon request to enhance investigatory capacity and accountability.

Penalties and Enforcement

Failure to comply with the Sub-Decree may result in administrative and sanctions, including:

• A fine of KHR 400,000 (approx. USD100) for negligence in fulfilling obligations related to security and safety systems;
• A fine of KHR 4,000,000 (approx. USD1,000) per foreigner for intentionally allowing illegal foreign residents, without prejudice to criminal liability;
• Officials who fail to perform their duties in good faith shall face disciplinary action, including dismissal.

This Sub-Decree significantly enhances regulatory oversight of concentrated residential areas and places clear legal responsibilities on owners, managers, private security providers, and authorities. All relevant stakeholders are advised to review their current practices, ensure compliance with resident management and security requirements, and prepare for increased inspections and enforcement.

Labor

The MLVT specifies in this notification that strict legal measures will be taken against any employer who requires Cambodian migrant workers returning from Thailand to present a Cambodian national ID card as a condition of applying for employment.

This requirement contradicts the Notification No. 026/25 dated August 11, 2025, concerning the exemption from the obligation to attach Cambodian national ID cards when applying for employment for Cambodian migrant workers returning from Thailand.

Clarification on acceptable identification documents

The MLVT further clarifies that, for the purpose of applying for legal employment, issuance of a Cambodian employment book, and registration with the National Social Security Fund, employers may accept any one of the following identification documents from Cambodian migrant workers returning from Thailand:

• Birth certificate
• Family book
• Passport
• Cambodian overseas worker travel document (TD)
• Cambodian -Thailand border pass
• Any other identity document issued by a competent authority

Requiring a Cambodian national ID card will be considered a violation of labor inspection measures and subject to administrative fines in accordance with the Labor Law.

Taxation

In a continued effort to strengthen the resilience and competitiveness of Cambodia’s export-driven industries, the MEF has announced the temporary suspension of the obligation to make monthly income tax prepayments for certain industrial enterprises in the textile and garment sector.

Purpose and policy objective

This goal is to promote the sustainability of the textile and garment industry, enhance export capacity, and protect employment opportunities for Cambodian workers who depend on this key sector of the economy.

Enterprises eligible for the suspension

The suspension applies to enterprises operating in the textile and garment sector that are registered as qualified investment projects, including manufacturers engaged in the following for export:

• Textile and garment production
• Footwear manufacturing
• Handbag and briefcase production
• Hat manufacturing
• Clothing label production
• Manufacturing of gloves, socks, and towels
• Production of pillowcases, quilt covers, bedspreads, and tablecloths

Duration of the suspension

The temporary suspension of monthly income tax prepayments begins from December 26 2025, through December 31, 2028.

Conditions for obtaining this incentive

To continue benefiting from this suspension, enterprises must strictly comply with the following requirements:

• Proper accounting records must be maintained in accordance with the applicable regulations.
• All tax declarations must be submitted and other tax obligations settled on time.
• An annual independent audit report must be provided to the tax authorities.

Failure to meet these compliance obligations may result in the revocation of the suspension and the imposition of a tax reassessment and penalties.

Trust

This Prakas establishes comprehensive conditions and procedures for obtaining approval to establish branches in Cambodia’s trust sector. It strengthens regulatory oversight and clarifies governance, licensing, and operational and compliance obligations applicable to licensed trust companies and trust service operators. Key highlights are provided below.

Scope

This Prakas applies to trust companies and trust service operators that have been licensed or authorized by the Cambodian Trust Regulator (“TR”) to conduct trust operations in the country.

No parent company may establish a branch, nor may any person represent itself as a trust branch, without obtaining prior approval from the TR.

Conditions for approval

To obtain approval to establish a branch, the Parent Company must comply with comprehensive regulatory conditions, including:

• Register the branch in the commercial register in Cambodia
• Register the branch with the tax department
• Must be a clear branch management structure that ensures transparency, accountability, efficiency, and sound corporate governance.
• Must have a suitable premise and operational facilities that are appropriate to the scale of the branch’s activities.
• Must have sufficient IT systems and infrastructure.
• Must implement effective internal control and risk management frameworks.
• Must have proper complaint-handling and dispute resolution mechanisms.
• Must have adequate, qualified, and regulator-approved personnel.
• Other requirements as determined by the TR.

The above operational requirements do not apply to parent companies that are commercial banks licensed or authorised to operate as trust service operators providing safekeeping or custodial services.

Management and human resource requirements

Each branch must appoint the following management personnel, as applicable:

• A branch director (required for all branches); and
• A head of operations (required for branches of trust service operators providing safekeeping or custodial services).

These individuals must be officially recognized as qualified by the TR prior to their appointment.

To be eligible, they must:

• Be of good character and satisfy fit-and-proper criteria.
• Be legally competent and reside in Cambodia.
• Hold at least a bachelor’s degree in trust, finance, or a related discipline (or an equivalent qualification).
• Possess the relevant professional experience:
  • At least four years for branches of licensed trust companies.
  • At least three years for branches of trust service operators providing safekeeping or custodial services.
• Be formally appointed by the parent company.
• Complete mandatory training and pass examinations organized or recognized by the TRC.

Examination results are valid for two years. Approved personnel must complete continuing professional education before the expiration of the validity period.

Branches of licensed trust companies must also appoint licensed individual trustees in numbers proportionate to the size and type of their trust operations.

Application process and regulatory review

• An application to establish a branch is submitted in the prescribed form, together with all required supporting documentation to the TR.
• The TR issues a written decision approving or rejecting the application within 60 days from receipt of a complete application dossier.
• The TR may conduct on-site inspections to verify operational readiness, governance arrangements, systems, and supporting documentation.
• The approved branch must then commence operations within 3 months from the date of approval.

Ongoing compliance obligations  

The parent company remains fully responsible for all obligations and activities of its branches. Vacancies in key positions must be filled within two months.

Branch operations must be conducted separately from the parent company’s other business activities, including:

• Separate operational systems and IT infrastructure;
• Dedicated personnel; and
• Appropriate information barriers to prevent conflicts of interest and misuse of information.

Prior approval from the TR is required for:

• The appointment or replacement of the branch director or head of operations.
• A change of the branch’s registered address.
• The transfer or reassignment of licensed individual trustees between the parent company and its branches.

Suspension, revocation, and closure

A parent company intending to close a branch must obtain prior approval and comply with the conditions prescribed by the TR.

The TRC may suspend or revoke a branch’s approval where:

• The parent company requests the suspension or termination of its operations.
• The parent company is in financial or technical distress, liquidation, or court-ordered dissolution.
• The parent company fails to maintain the required approval conditions.

Official Service Fees

• Fees to be paid by the parent company when applying to establish a branch:
  • Application fee: KHR20,000 per application (approx. USD5)
  • Dossier review fee: KHR600,000 (approx. USD150)

• Annual branch authorization fees

Upon approval from the TR, the parent company must pay an annual authorization fee for each branch, which varies depending on the type of trust operation conducted:

• • Public trust operations: KHR5 million per year (approx. USD1,250)
  • Commercial trust operations: KHR4 million per year (approx. USD1,000)
  • Social trust operations: KHR2 million per year (approx. USD500)
  • Individual trust operations: KHR2 million per year (approx. USD500)

• Fees for amendments or changes

Where the parent company seeks approval for certain changes, a dossier review fee of KHR200,000 (approx. USD50) per request applies in each of the following cases:

• • Change of a branch’s registered address
  • Appointment or replacement of a branch director or head of operations
  • Change in the workplace location of licensed individual trustees between the parent company and its branches, or between branches

All fees are non-refundable, regardless of whether the application is approved or rejected.

Administrative sanctions

Non-compliance may result in the imposition of administrative measures by trust inspectors, including:

• Warnings
• Corrective orders
• Restrictions on the license and/ or permit
• Restrictions on the management and/ or administration of trust
• Suspension of the license and/ or permit
• Removal or dismissal of branch management or responsible personnel
• Revocation of the license and/ or permit

The formalities and procedures governing the imposition of the above administrative sanctions and penalties shall be implemented in accordance with Prakas No. 002 dated January 03, 2024 on the Formalities and Procedures for Administrative Sanctions and Penalties in the Trust Sector.