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Opening a hotel or guesthouse in Cambodia involves a number of administrative steps. While it would be nice to simply find a suitable space and open one’s doors to paying guests, the reality is quite different.

Hotels and guesthouses (the difference is really one of size and nomenclature) are businesses like any other. That means that, while not strictly necessary, it is highly advisable that the owners establish a private limited company. Otherwise, they would be personally liable for the debts of the business. Like any company, you’ll also have to pay taxes – meaning obtaining a Patent Certificate and making periodic tax payments. Finally, you’ll need to obtain a hotel or guesthouse license from the Ministry of Tourism. This in turn requires a number preliminary approvals to check the sanitation and safety of the facilities. A fuller explanation of the procedures and applicable laws and regulations can be found in our recent report.

Failure to follow the proper procedure can lead to delays in opening and fines. Best to do it correctly from the start.

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Properly setting up a company is only the beginning of its legal obligations. Once registered to operate, a business must follow periodically:

  • Submit annual declarations to the relevant authorities
  • Maintain proper accounting
  • Pay taxes
  • Renew licenses
  • Authenticate corporate structural changes

Failure to do so can lead to fines, penalties, and trouble in selling or closing the business. For further information, please refer to our new report.

Cambodia still has a long way to go in terms of its intellectual property enforcement, and infringement is rife in all areas of consumer products.  But a recent news article in The Cambodia Daily highlighted the issues around not fake bags or bootleg movies, but fake pepper. 

As previously discussed in an earlier blog post, Cambodia registered Kampot pepper as a geographical indication.  A geographical indication is a special type of protection for goods, where the source of the good is an important aspect and indicator of the product’s quality.  This also means that only pepper as grown according to certain guidelines is permitted to be legitimately sold as Kampot pepper.

Why would this pepper be an ideal good to counterfeit?  For one thing, Kampot pepper is renowned for its quality and as such, can be sold for higher prices.  According to the article, prices are estimated to rise to $10 per kilogram for genuine black Kampot pepper, and white and red pepper can be sold for even higher prices.  Kampot pepper is also in high demand, and because their GI status requires strict rules governing production and quality control, increasing supply is challenging.

While the Ministry of Commerce has been assisting to prevent the sale of fake Kampot pepper and has been issuing warning letters to illegitimate sellers, the article mentions that in 2011, only two shops were shut down.  Hopefully, stronger enforcement measures will be taken in the future to help maintain the quality associated with Kampot pepper and encourage real Kampot pepper farmers to continue production.  And for those buyers wondering if they have the real thing on their hands, according to the article, real Kampot pepper should be sold with the green seal of authenticity as issued by the Ministry of Commerce.

Most individuals living and working in Cambodia are aware that they have to pay tax on their salary. As the obligation to declare this rests with the employer, most individuals don’t give it much further thought.

But what about other forms of income, besides salary?

This publications answers the question.

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The work of a handful of attorneys at BNG Legal, this blog's mission is to keep the world up-to-date on legal issues in the Kingdom of Cambodia.

Questions and feedback can be emailed directly to us at info@bnglegal.com.

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