2016 07 November

Cambodia investment update for October 2016

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LABOUR

Minimum Wage for Workers in Textile, Garment, and Footwear Industry for 2017 Prakas № 414 dated 29 September 2016

The purpose of Prakas No. 414, issued by the Ministry of Labour and Vocational Training (“MLVT”), is to determine the monthly minimum wage for workers in textile, garment, and footwear industry for the year 2017 to be implemented from 01 January 2017. The monthly minimum wage will be USD 153 for regular workers and USD 148 for probationary workers.  

This Prakas also sets out the monthly minimum wage for workers who receive salary based on the quantity of products they produce (i.e. piece work). The salary of a piece rate worker will be determined based on the quantity of products they actually produce provided that their earned salary is not less than the monthly minimum wage mentioned above.

COMMERCIAL REGISTRATION

Extension of Period Re-Registration Business Entities in the Automated System Notification №. 3890 dated 14 October 2016

The purpose of this Notification No. 3890, issued by the Ministry of Commerce (“MOC”), is to notify the directors of companies, enterprises, branches, representative offices, subsidiaries, and agencies, which were incorporated prior to 04 January 2016, and have not been registered in the MOC’s automated system in accordance with Prakas No. 300 dated 29 December 2015, that the deadline for has been extended to 31 December 2016.

This notification also emphasizes that after the above deadline, the MOC will notify the Ministry of Economy and Finance (“MEF”) to clear any outstanding tax obligations and commence the applicable legal proceedings against any business that has not complied with the re-registration requirement.

Given the above, the MOC, through this notification, strongly encourages directors of the relevant companies, enterprises, branches, representative offices, subsidiaries, and agencies to commence with the re-registration of their entities in the automated system no later than the stated deadline.  Importantly, completing the re-registration process can take some time, and as such, the process should be commenced well-ahead of the stated deadline.

TAXATION

IMPLEMENTATION OF TAX AGENT SERVICE Notifications № 17509 GDT dated 18 October 2016

Per Notification 17509, the General Department of Taxation (“GDT”) informs all taxpayers and withholding tax agents and tax agent service companies that the GDT will start implementing certain tax agent service compliance requirements from 01 January 2017 and all taxpayers and withholding tax agents and tax agent service companies must comply as follows:

  • Taxpayers can complete and submit their own monthly tax returns, payment of monthly taxes and annual tax returns and deal with the tax administration with respect to their tax obligations. If a tax agent service is required, taxpayers must engage a licensed tax agent service provider.
  • Licensed tax agent service providers are required to obtain a power of attorney from their client to act as taxpayer’s tax representative. Tax agent service companies can perform tax services for their clients with their employees but the employees must be duly authorized by the companies.
  • All tax agent companies who have not received a tax agent license are required to promptly apply for such license from the GDT. From 01 January 2017, any person who is not a licensed tax agent will not be allowed to deal with or fulfill tax matters on behalf of taxpayers.
  • In case that any person or legal person performs tax agent services without a license issued by the GDT, such person or legal person may be subject to obstructing the implementation of the Law on Taxation under Article 128 and liable for penalties under Article 136 of the Law on Taxation. Furthermore, any real regime taxpayer who engages tax services from a person who is not a licensed tax agent may be subject to a penalty of KHR 5,000,000 (approx. USD 1,250).

DFDL contact:
Alex Larkin
Senior Consultant
alex.larkin@dfdl.com

*The information provided is for information purposes only, and is not intended to constitute legal advice. Legal advice should be obtained from qualified legal counsel for all specific situations.