The closure of business in Cambodia requires more effort than opening one, however, business owners must operate completely to avoid further implications. You couldn’t just shut down a company unofficially because further risks remain high to destroy you. Without the closure of a business properly, you still must confront a legal entity that you must completely clear before leaving.
The Council for Development of Cambodia had warmed business owners to legally and formally close the business no matter what. However, business owners cannot escape from a legal entity, even a ghost company, since the Ministry of Commerce always make annually declaration to ensure all business owners are cleared their duties.
Therefore, “there’s a will there’s a way”.
The following steps will guide you to closure a business in a proper way according to Chapter L of the Law on Commercial Enterprises:
Step 1: Proposing a director or shareholders to readily dissolve or liquidate the company.
Step 2: When the proposal of the intent to dissolve is passed by a two-thirds majority vote, the company require to address a Certificate of Intent to Dissolve by sending it to the Director of the Company. From that time on, the company must completely cease all procedures of the company.
Step 3: The company must send notice of intent to dissolve to creditors, immediately and publish a statement for two weeks in a newspaper.
Step 4: It then must collect its property, distribution to shareholders, and anything important to liquidate the business. In addition, the MoC will issue the certificate of dissolution, which meant that the process and obligations are still ongoing, including the official audit performed by the Department of Taxation, somehow costly.
The procedure for the dissolution of business in Cambodia requires much time and money, but you must complete all requirements, in case you would like to avoid the worst implications for yourself and your future business.