Trade and Custom


Trade and Custom

1.   Regulatory Framework for the Trading Activities

In January 2000, “Prakas (Ministerial Order) on Trading Activities of Commercial Companies” was issued by the Ministry of Commerce, and both Cambodian and foreign companies, which are registered with the Ministry of Commerce, became to be allowed to have the right to freely engage in trading activities.

Under the Sub-Decree No.111 on the Implementation of the Law on the Amendment to the Law on Investment, however, investment activities in all kinds of commercial activity, import, export, wholesale, retails and duty free shops, are stipulated not to be eligible for investment incentives. (Section 2, Annex I)

2.   Regulatory Framework for the Customs

“Law on Customs” was promulgated on 25 July 2007 for the following purposes (Article 1).

-     To provide the right for the administration, control and collection of duties, taxes and fees on imported and exported goods,

-     To provide for the control and regulation of the movement, storage and transit of such goods,

-     To promote the prevention and suppression of fraud and smuggling,

-     To participate in implementing the international trade policy of the Royal Government of Cambodia,

-     To promote the application of international standards and best practices regarding customs control and trade facilitation.

General Provision

The Customs and Excise Department is responsible for the administration and enforcement of the provisions of this Law. The Department operates under the direct supervision of the Ministry of Economy and Finance (Article 1).

The Customs Territory includes the land territory, territorial waters and airspace as well as offshore islands of the KINGDOM OF CAMBODIA. The Royal Government of Cambodia may establish Free Zones that are excluded from all or part of the customs procedures (Article 2).

This Law must be applied:

-     equally throughout the customs territory;

-     equally to all persons; and

-     without any immunity or dispensation to goods imported or exported by the state or on its behalf (Article 3)

All imported and exported goods are subject to the provisions of this law. Goods entering or leaving the customs territory are subject, as applicable, to import duties and taxes or export duties and taxes as specified in the Customs Tariff. The establishment and application of the Customs Tariff shall be prescribed by Sub-Decree (Article 5).

The Royal Government may by Sub-Decree take measures to protect Cambodian producers by raising tariffs when domestic producers are injured by an increase in imports, by subsidies provided by other governments to their countries’ exports to Cambodia, or by goods that are dumped on Cambodia’s markets (Article 7). The Royal Government may by Sub-Decree prohibit or restrict, subject to conditions, the import or export of certain goods for any of the following purposes (Article 8):

-     National security;

-     Public order and standards of decency and morality;

-     The protection of health and life of persons, animals or plants;

-     The protection of national treasures of artistic, historic or archaeological value;

-     The conservation of natural resources;

-     The compliance with the provisions of any legislation of The Kingdom of Cambodia currently in force;

-     The fulfillment of obligations under the Charter of the United Nations.

To combat smuggling and fraud, the Minister of Economy and Finance may by Prakas identify certain sensitive or highly taxed goods as specially designated goods for the purposes of this Law, and may impose additional controls and restrictions on their transport, circulation, storage and possession.


All imported goods must be reported at a customs office or other location as determined by the Director of Customs. The Minister of Economy and Finance may by Prakas determine the time, manner, documentation requirements, circumstances and exceptions with respect to the reporting of imported goods (Article 10).

No person shall unload goods from a conveyance arriving in Cambodia until the goods have been reported to Customs in accordance with this Law (Article 12).

Customs may authorize the removal of the goods referred to in Article 10 from the customs clearance area prior to the payment of duties and taxes and fees, under customs control and after the fulfillment of customs formalities, for the purposes of:

-     placing in customs temporary storage;

-     placing in customs bonded warehouse;

-     further transportation within or through the Customs Territory to a destination (Article 13)

Imported goods may be released by Customs for temporary admission if at the time of importation it can be demonstrated that these goods will be re-exported. Temporarily imported goods shall be under customs control until such time as the conditions of their temporary admission have been fulfilled (Article 15).


All goods to be exported must be reported at a customs office or other location as determined by the Director of Customs. The Minister of Economy and Finance may by Prakas determine the time, manner, documentation requirements, circumstances and exceptions with respect to the reporting, movement, storage and transportation of goods to be exported (Article 16).

Tariff Classification, Origin and Customs Value

Tariff classification, origin and customs value of imported goods specified on Customs declarations, shall be declared in accordance with the following rules (Article 18).

  Any person, importer or his agent, who completes a customs declaration of imported goods, shall declare the tariff classification, origin of those goods and customs value for the calculation and assessment of duty and tax. Customs shall verify the tariff classification and origin of the imported goods.

  Any person, importer or his agent is responsible for declaration of the accurate customs value for the payment of duties and taxes and must disclose all information, invoices and other documentation to enable Customs to verify and accurately determine the customs value of the imported goods.

  Customs may, within 3 years of the date of registration of any customs declaration, following an audit, investigation, inspection or examination of the imported goods, re-determine the declared tariff classification or origin by issuing a Notice.

  When an audit, investigation, inspection or examination undertaken under this Article finds any fraudulent activity, a Notice may be issued for the goods under investigation within a period no longer than 10 years from the original date of registration of the customs declaration.

  All additional duties and taxes and any other fees and penalties owed as a consequence of the Notice, shall be paid to Customs.

  Any refund of duty, taxes, fees and penalties overpaid by any person, importer or his agent as a consequence of the Notice shall be refunded by Customs.

For the purposes of import and export, goods are classified and, unless otherwise exempted by this Law or any other Law of the Kingdom of Cambodia, duty and tax are calculated in accordance with the Customs Tariff (Article 19).

For imports, applicable duties and taxes are collected according to the origin of the goods. The origin of natural products is the country where they were extracted from the soil or harvested. Goods manufactured in a single country, with no contribution from materials from another country, originate in the country where they are manufactured. The country of provenance is the country from which the goods were sent directly to the customs territory (Article 20).

The customs value of imported goods shall be determined in accordance with the following rules (Article 21):

a.    The customs value of imported goods shall be the transaction value, which is the price actually paid or payable for goods when sold for export to Cambodia.

b.   When the customs value cannot be determined under (a), the transaction value of identical goods or the transaction value of similar goods shall be used in its order.

c.    When the customs value cannot be determined under (a) and (b), it shall be based on a deductive method or on a computed method in its order.

The customs value of exported goods shall be the value of the goods at the point of exit, which is determined by adding to the price of the goods, expenses for transport as well as all expenses needed to carry out the export operation up to the frontier, excluding export taxes payable upon exit, domestic taxes and similar levies, for which the exporter has been given a receipt (Article 22).

Exemptions, Partial Exemptions, and Refund Of Duties and Taxes

Import duties and taxes shall not be imposed on goods brought into the Customs Territory for transit or transshipment (Article 25).

Exemption of Import Duties and Taxes shall be granted with respect to the import of goods exempted under the provisions of any other Law of Cambodia, goods for foreign diplomatic or consular missions, international organizations and agencies of technical co-operation of other governments, etc. (Article 26).

Partial exemption of import duties and taxes may be granted with respect to the import of Seeds and breeding animals for agriculture, goods for temporary admission, Goods and materials so specified under any other Law of Cambodia, etc. (Article 27).

Customs Declaration

All imported or exported goods, whether or not exempt from duties and taxes, must be the subject of a Customs declaration (Article 29). Imported or exported goods must be declared by their owners or by persons authorized to act on the owners’ behalf (Article 31). Any person may, without exercising the profession of customs broker, make customs declarations for their own business (Article 33).

The importer or owner of the goods shall be liable for import duties and taxes (Article 35). In the case of customs temporary storage or customs bonded warehouse storage, the operators are liable for import duties and taxes and other fees (Article 35).

Customs Temporary Storage and Customs Boded Warehouses

Customs temporary storage refers to the storage of goods under Customs control in approved premises pending the completion of Customs formalities. Licenses for the operation of a customs temporary storage facility are approved by the Minister of Economy and Finance (Article 43).

Customs bonded warehouses are facilities where goods may be placed for a specified period of time under customs control. Placing goods in customs bonded warehouses suspends the application of the duties, taxes and restrictions for which they are liable. There are three categories of customs bonded warehouses:

a.    Public warehouses, which are licensed by the Minister of Economy and Finance, may be operated by any agency of the Royal Government, or by any person. Public warehouses are open to any person who has the right to store the goods in the warehouse.

b.   Private warehouses, which are licensed by the Director of Customs, are to be used solely by specified persons to store goods for their own specific uses, including operators of duty free shops.

c.    Special warehouses, which are licensed by the Director of Customs, are a type of warehouse for goods which may present a hazard, or could affect the quality of other goods, or could require special storage facilities.

Licenses for customs bonded warehouses will determine conditions for owners and operators including location, construction and layout of premises, and procedures for the control and handling of goods (Article 44). Goods may remain in customs bonded warehouses for up to two (2) years from the date of registration (Article 46).

In certain circumstances, the Minister of Economy and Finance may authorize the establishment of customs manufacturing bonded warehouses, for the purpose of processing or manufacturing of goods. Goods accepted in customs manufacturing bonded warehouses are exempt from import duties and taxes (Article 49). Operations that carry out the processing or refining of crude petroleum or bituminous minerals to obtain petroleum products must be placed under the customs manufacturing bonded warehouse regime (Article 50).

3.   Export and Import Procedures


The SAD has been implemented manually since January 2008 and the pilot implementation of “ASYCUDA World” has begun at Sihanoukville Port from May 2008. SAD is now fully implemented to all the customs clearance operations and ASYCUDA became operational at Sihanoukville Port, Phnom Penh International Airport, three dry ports around Phnom Penh and check point at Bavet (Vietnam border), and is now under preparation for implementation at Poipet customs. The GDCE aims to implement ASICUDA at all the customs at border by early 2012. At the checkpoints served by ASYCUDA, more than 90% of import and export goods are cleared from customs within 24 hours after the presentation of customs declaration.

The risk management has been implemented at above checkpoints in conjunction with ASYCUDA and the physical inspections have been reduced to less than 20% of import containers and to 13% of export containers.

The GDCE currently plans to implement the large-scale Post Clearance Audit (PCA) which is the audit to be carried out at the importer’s place of business after goods have already been cleared by Customs. PCA itself is a common practice in all countries and required under WTO rules. Although PCA has already been carried out in some cases, the GDCE plans to enlarge the operation to verify the importers’ compliance of customs duty by checking the invoices, other shipping documents and contractual documents. For PCA, the GDCE may orderly select the importers with large transaction and/or with a larger risk of non-compliance.

Import Procedures

According to the website of the General Department of Customs and Excise, the import procedures at the Sihanoukville Port are as follows (GDCE Annex 5, 2003):

1)   Upon arrival of the vessel at the port, KAMSAB (the government-owned shipping agent for marine cargo) informs Customs, CAMCONTROL, and Immigration Police.

2)   The Customs Chief assigns 2 officers to the boarding committee or Formality Team, which includes KAMSAB, CAMCONTRPL, Port Authority, Immigration Police, and Quarantine. The Team breaks up to carry out their respective functions in formal clearance of the vessel and crew.

3)   After vessel formalities, the Customs authorizes unloading of cargo. The Active Team that includes KAMSAB and Port Authority monitors unloading, checks cargo against the manifest, and verifies the condition of seals.

4)   Cargo is stored in the warehouse and received by the operator. While awaiting their importer they are under the responsibility of the warehouse operator and Warehouse Team. A computer register of all cargo is maintained by both the operator and the Customs. Goods are allowed 45 days storage, beyond which a daily penalty of 1% of the value is exacted. Goods stored beyond 3 months are transferred to the Customs warehouse.

5)   Importers lodge three copies of the declaration with supporting documents such as commercial invoice, packing list, bill of lading, Import license (if required), Report of Finding (ROF) if an import FOB value greater than USD 4,000.00 and other documents if any.

6)   At the clearance point, the declaration is registered with a sequential number that is unique to an individual entry processing unit. 3 copies of the entry are submitted to the clearance point with invoice, bill of lading, packing list. Declaration information is validated and scrutinized. The CAMCONTROL form is also attached to the declaration.

7)   After assessment, importers pay duties in cash or bank guarantee either at the accounts section, or treasury in Phnom Penh which issues a receipt. Storage fees are also paid for.

8)   The Customs Examination Team inspects the goods simultaneously with CAMCONTROL. The Government plans to reduce the ratio to 5% by the end of 2010. In June 2002, a TC-Scan machine was installed to reduce physical inspection.

9)         When goods are released, containers are loaded on trucks for transport to outside of the Port. Customs Entrance/Exit Team checks documents and receipts to verify payment, and matches container numbers against ship manifests.