Types of Business Entities for company formation in Cambodia
When planning a company formation in Cambodia, understanding the different types of business entities is essential for choosing the most suitable structure for your operations. The most common and straightforward option is the Sole Proprietorship, where a single individual owns and manages the business.
While easy to register and operate, the owner assumes full personal liability for any business debts. A Partnership is another form, allowing two or more individuals to jointly run a business, sharing profits, losses, and responsibilities. Partnerships can be general or limited, depending on the liability and involvement of each partner.
The most widely used structure for both local and foreign investors is the Private Limited Company (PLC). This entity offers limited liability to shareholders and requires at least one director and two shareholders. It is a separate legal entity and suitable for small to medium-sized enterprises. For larger-scale operations or those planning to list publicly, a Public Limited Company is appropriate, though it involves stricter regulations and higher capital requirements. Foreign investors can also establish a Branch Office or Representative Office.
A Branch can conduct business activities, while a Representative Office is limited to market research and promotional tasks. Choosing the right entity is critical for efficient company formation in Cambodia and long-term business success.