According to Statista.com, Cambodia’s e-commerce market is on a steady growth trajectory, with revenue projections reaching US$1,097.00 million in 2023. This growth is set to continue at an annual rate of 12.83% (CAGR 2023-2027), resulting in a projected market volume of US$1,778.00 million by 2027. In comparison, China is expected to generate the most revenue with a market volume of US$1,487.00 billion in 2023.
The Cambodian eCommerce market anticipates a rise in users, reaching 8.76 million by 2027, and increasing user penetration from 41.2% in 2023 to 49.7% in 2027. Furthermore, the average revenue per user (ARPU) is projected to be US$157.30.
On 12 May 2021, the Ministry of Commerce (MOC) and the Ministry of Economy and Finance (MEF) of Cambodia issued Joint Prakas 315 and 316, introducing new regulations and fees for e-commerce permits and licenses, as well as a set of monetary fines for violations. This development is aimed at streamlining the process for businesses operating in the e-commerce sector, ensuring compliance, and establishing a systematic approach to levying fines for violations.
E-Commerce Permits and Licenses
The Announcement on the Granting of E-Commerce Permits and Licenses, issued on 26 May 2021, allows eligible applicants to apply for e-commerce permits or licenses with immediate effect. These applications can be submitted through the online portal (www.ecommercelicensing.moc.gov.kh) or as hard copy applications to the Department of Business Registration. The enactment of the Law on E-Commerce, Sub-Decree on Classifications, Formalities, and Procedures on the Issuance of Permits and Licenses, and Prakas on the Issuance of E-Commerce Permits and Licenses has led to this development.
Individuals and sole proprietors conducting e-commerce activities are required to apply for an e-commerce permit, while legal persons or branch offices of foreign companies must apply for e-commerce licenses.
Official Fees and Monetary Fines
In accordance with Cambodia’s E-Commerce Law, the following entities are authorized to engage in e-commerce activities within the country: individuals, sole proprietorships, legal entities, and branches of foreign corporations. Joint Prakas 315 sets out the official fees for e-commerce permits and licenses, while Joint Prakas 316 details the fines that the MOC may levy. The fees and fines are as follows:
- E-Commerce Permit for an individual: KHR 200,000 (approx. USD 50) with a validity of 2 years
- E-Commerce Permit for sole proprietorship: KHR 400,000 (approx. USD 100) with a validity of 2 years
- License for legal person or branch office of foreign companies: KHR 1,000,000 (approx. USD 250) with a validity of 3 years
Monetary fines listed under Prakas 316 include penalties for conducting e-commerce activities without a valid permit or license, failure to register changes with the MOC, providing inaccurate or forged documents, and failure to file financial statements, among others. A monetary fine of KHR 10,000,000 (approx. USD 2,500) will be imposed on those conducting e-commerce activities without a valid e-commerce permit or license.
Compliance and Legal Support
Before applying for an e-commerce license, legal persons and branch offices of foreign companies must first obtain an online certificate from and register a domain name with the Ministry of Posts and Telecommunications. However, this requirement is not compulsory for individuals and sole proprietors.
Additional Sanctions under Prakas 316
The MOC and MEF have published additional monetary fines under Prakas 316, which include penalties for failure to register changes with the MOC, provision of inaccurate and forged documents during registration, provision of inaccurate information in company reports, and failure to file a copy of financial statements with the MOC.
Filing Financial Statements
According to Article 228 of the Law on Commercial Enterprises (LCE), public limited companies issuing securities to the public that remain outstanding and are held by more than one person must file a copy of their financial statements and accompanying documents with the MOC. Although only public limited companies issuing shares and bonds to the public are subject to this requirement based on the LCE, the MOC requires all public limited companies, including non-listed ones, to file their financial statements with the MOC.
Regarding timing, the MOC advises that financial statements may be filed together with the annual declaration of the commercial enterprise (ADCE) in accordance with Prakas 107 on the filling of ADCE, issued on 05 April 2017.
Cambodia’s e-commerce market is witnessing significant growth and expansion, with revenue expected to reach US$1,778.00 million by 2027. Alongside this growth, the Cambodian government has implemented regulations and fees concerning e-commerce permits, licenses, and monetary fines through Joint Prakas 315 and 316. These developments aim to streamline processes, ensure compliance, and establish a systematic approach to levying fines for violations. As the e-commerce sector continues to evolve, businesses operating in this space must stay informed and adhere to these updated regulations to avoid potential legal complications and fines.
Source: DFDL and statista.com