Skip to content Cambodia’s New Investment Law 2025: A Top Choice for Foreign Investors in Southeast Asia
Introduction
Cambodia's new investment law represents a transformative shift in the country's economic landscape. With improved incentives and streamlined processes, foreign investors now have stronger reasons to enter the Cambodian market. If you're planning to establish a company, be sure to read our step-by-step guide to starting a foreign-owned business and explore strategic business setup tips tailored for international entrepreneurs.
Cambodia is rapidly emerging as one of Southeast Asia’s most attractive destinations for foreign investment. With the introduction of the new Cambodia Investment Law 2025, the country has reinforced its commitment to creating an investor-friendly environment. This law brings significant improvements in investment protection, tax incentives, and business facilitation — making Cambodia a strong competitor against neighboring markets like Vietnam, Thailand, and Laos.
In this post, we will explore the highlights of Cambodia’s new investment law, compare it with other countries in the region, and explain why foreign investors should consider Cambodia for their next venture.
What Makes Cambodia’s New Investment Law 2025 Stand Out?
1. Enhanced Investor Protection and Profit Repatriation
Cambodia guarantees full repatriation of profits and capital in foreign currency without cumbersome restrictions. This contrasts with countries like Vietnam, where currency control can complicate profit transfers.
2. Attractive Tax Incentives and Duty Exemptions
The law offers tax holidays of up to 9 years, plus exemptions on import duties for machinery and raw materials used in priority sectors such as manufacturing, agriculture, renewable energy, and technology. These incentives are often more generous and flexible than in Thailand or Laos.
3. Streamlined Licensing and Business Registration
Cambodia has simplified business registration procedures, with many licenses obtainable within two weeks. This is notably faster compared to Vietnam’s multi-layered bureaucracy and Thailand’s more rigid regulations.
4. Expanded Investment Promotion Zones
The new law extends incentives beyond Special Economic Zones (SEZs) to underdeveloped provinces, encouraging balanced economic growth nationwide and providing new opportunities for investors seeking regional advantages.
5. Improved Dispute Resolution Mechanisms
Cambodia’s strengthened arbitration framework aligns with international standards, giving investors greater confidence in legal protections — an edge over less-developed frameworks in neighboring Laos.
How Does Cambodia Compare with Its Neighbors?
| Feature | Cambodia | Vietnam | Thailand | Laos |
|---|---|---|---|---|
| Profit Repatriation | Guaranteed, no restrictions | Some currency controls | Allowed, but some restrictions | Allowed, less streamlined |
| Tax Holidays | Up to 9 years, generous | Typically shorter | Varies, generally less | Limited |
| Business Registration Time | ~2 weeks | Several months | Several weeks | Weeks to months |
| Foreign Ownership Rights | 100% in many sectors | Restrictions in some sectors | Restrictions in key sectors | Mostly unrestricted |
| Investment Promotion Areas | SEZs + underdeveloped regions | Mostly SEZs and industrial zones | SEZs + targeted sectors | Mostly SEZs |
| Dispute Resolution | Strong arbitration framework | Developing | Established, but complex | Less mature |
Why Now Is the Best Time to Invest in Cambodia
- Strategic Location: Cambodia provides easy access to the ASEAN market of over 670 million people with numerous free trade agreements (ACFTA, RCEP).
- Competitive Costs: Lower labor and operational costs than most neighbors enhance investment returns.
- Government Support: The Cambodian government actively promotes foreign investment through legal reforms and incentives.
- Growing Sectors: Booming opportunities in renewable energy, agro-industry, manufacturing, tourism, and digital innovation.
Conclusion
Cambodia’s new Investment Law 2025 makes it one of the most attractive foreign investment destinations in Southeast Asia. Its robust investor protections, competitive tax incentives, and simplified business processes give it an edge over Vietnam, Thailand, and Laos.
For foreign investors seeking a dynamic, stable, and growth-oriented market, Cambodia offers a compelling and future-ready environment to maximize returns and minimize risks.
Ready to explore investment opportunities in Cambodia? Contact us today to learn how you can take advantage of the new Investment Law and start your business in Cambodia.
