Cambodia’s Enforcement Of Compliance – why all the fuss?

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Visa ApplicationFor the past 10 years, Cambodia has been aiming in a positive direction towards becoming a known business hub in South East Asia. The attractiveness of business opportunity, potential for profitable returns and a relatively business friendly environment has meant that foreign investment and foreigners working in Cambodia has steadily increased.

As such compliance throughout all sectors of business has been a primary focus, and whilst Cambodia has at times struggled to implement its compliance laws effectively, the existence of laws and legislation has been openly visible to business and individuals.

The recent enforcement by Cambodian authorities to ensure all businesses and individuals are paying legitimate taxation, have appropriate work permits and up-to-date visa’s is another step in a positive direction of compliance.

So why is there so much fuss from business and individuals?

Many businesses and individuals are claiming that the enforcement of the laws are causing confusion and in some cases displaying another example of Cambodia engrossing itself in corrupt practices.

But that argument doesn’t stick – clear taxation laws have been enacted for the past 5 years in Cambodia, the law on foreign work permits has been enacted since 1995 and the law on visa’s has not changed for the past 10 years.

Negligence is never a defence to breaching the law in any country. It is up to each business and individual to ensure that they comply with all laws in the country they operate and live in, even if authorities in that country do not openly enforce the laws.

And that is where the problem has been for Cambodia and why many businesses and individuals are complaining and making a fuss.

ComplianceCambodia hasn’t in the past enforced many of its laws – businesses and individuals have been able to pay agreed taxation amounts under the table without issue, foreigners have been able to work in Cambodia without having a work permit or live in Cambodia permanently without having the appropriate visa.

Times have changed and Cambodia is now aggressively trying to enforce its own internal laws and comply itself to international rules before its integration into ASEAN at the end of 2015.

Remember, negligence is no defence to not complying with law.

SMCS-RISK offers compliance services to business and individuals wishing to operate and live in Cambodia. For more information contact