In B2B Cambodia's 'Legal Update' we delve into the latest legal changes and developments in Cambodia's laws and regulations with key experts in the field.
In Episode 6, Diberjohn Balinas, Tax Partner at DFDL Cambodia, provides an overview of the general customs procedures in Cambodia. Stay tuned for Part 2, detailing the documents and permits necessary for export and import activity.
B2B Cambodia: What steps do businesses need to take if they want to engage in import and export activities?
Diberjohn Balinas: “If you are planning to import or export goods into or from Cambodia, the resident enterprise must first be registered with the Ministry of Commerce, as well as the GDT (General Department of Taxation) with VAT, and also registered with the GDCE (General Department of Customs and Excise).
“Now, there are additional requirements that may be necessary if you are under a special regime, such as under QIP or Qualified Investment Projects. So registration with the CDC (Council for the Development of Cambodia) may also be relevant. Enterprises are also required to be registered with the system used by the GDCE, which is called ASYCUDA or the Automated System for Customs Data.
"For exporters who are exporting the goods to the EU or or U.S. under the Generalised Scheme of Preference (GSP), then another registration would also be required, which is called the REX, or the Registered Exporter System, to be applied with the Import and Export Control Department of the Ministry of Commerce. Now, if you are importing or exporting goods into Cambodia, you need to also have a customs broker who will also assist you in terms of clearing procedures with the GDCE or Customs Department.”
B2B Cambodia: How does the customs declaration process typically go? Could you give us a brief on the step by step process?
Diberjohn Balinas: “All import and export of goods are required to be declared with customs, whether the goods are exempted or not, or whether they need to pay relevant duties or taxes on specific types of goods. This declaration should be made by the importer or the owner of the goods, or the authorised representative of the goods. The procedures vary depending on whether it's via air, sea or land.
“As a general process, first, let's assume that a company has already been registered with the GDCE and has already secured registration with ASYCUDA. The importer or the authorised representative will have to submit an application online through the ASYCUDA system on the importation of the relevant goods. And the importer needs to provide documents such as the commercial invoice, the bill of lading or the airway bill, the licences required for those goods, the certificate of origin, and other relevant documents. A form called the ‘Single Administrative Document’ is filed through the ASYCUDA online portal. If the goods are covered by any relief under a preferential tariff or rule of origin, there is also a requirement to file and submit a declaration with the CVDS (Customs Value Declaration System) also within ASYCUDA.
“Step two concerns customs verification and assessment; this happens after you submit the filing with ASYCUDA. The system will assess whether the goods are considered cleared for inspection or not. There are colour categorisations for each type of good—if the goods are classified under green or blue, then there is no inspection required and you can proceed with automatic clearance and just pay the tax afterwards. But if your goods are classified under yellow or red, then there could be an inspection or a thorough review by the customs officer before they would allow you to import or clear the goods. After clearing, depending on the classification of the system, you can proceed with the payment of duties and taxes, which can be done through bank transfer, mostly online, but you can also pay directly at the bank. If the customs authority views that the payment has been made properly, then they can issue a release order.”
WATCH: Cambodia's Customs Procedures - Documents and Permits - Legal Update - DFDL Cambodia:
B2B Cambodia: Can you break down what documents and permits are required for businesses looking to import goods into Cambodia?
Diberjohn Balinas: “In general, when you are importing goods into Cambodia, you need to have the commercial invoice, the bill of lading for sea imports, the airway bill for air documents, and other transport-related documents as well. In some cases they also require the company to provide the cargo manifest, the proof of insurance payment, the licences, the permits for the importation of those kinds of products.
"In terms of permits, they are issued specifically depending on the type of goods to be imported. Usually, if the company is, for example, under QIP, then you need to get a separate approval from the CDC before they can allow you to import those kinds of goods. There are also several types of goods that are subject to customs permit, such as goods where the duties and taxes will be covered or absorbed by the state for humanitarian reasons, for diplomatic missions and related technical agencies, and other types of goods.
"There are also cases where goods can be classified as prohibited or restricted goods, as classified under Sub-Decree 370, which came into effect in May 2024. If the goods are listed as prohibited or restricted, mainly due to national concerns or health reasons, then you are not allowed to import those kinds of goods, except if you receive an authorisation or approval from the relevant ministry.”
B2B Cambodia: And how about for exports? What types of documents, permits and inspections should businesses expect if they're looking to export goods?
Diberjohn Balinas: “For exports, it's also similar with import procedures. The differentiation would also be on whether the goods are subject to restrictions, whether the goods are containerised, prohibited or restricted. And in terms of the procedures on duties and taxes, that's one of the main distinctions between export and import. Usually goods are not subject to duties and taxes upon export; most goods are exempted from duties and taxes upon export. But there are some kinds of goods, such as precious stones, processed wood, fish and other crustaceans, that can be covered by export duties and taxes—the listing is based on the classification under the Tariff Code of Cambodia. In terms of documentation, the same documents would also apply, such as the commercial invoice, the packing lease, the airway bill, the licences, and those kinds of documents also mentioned for imports.”