Legal Update: the Ministry of Commerce Clarifies Rules for Using a Company NameSeptember 1, 2021
Ministry of Commerce of Cambodia issued a clarification on the use of abbreviated names by Cambodian’s legal entities.
Starting a business in Cambodia by setting up a company requires registering the company through the Ministry of Commerce (“MOC”)’s online system.
As a matter of practice, to assign a name to the company, as the first step parties reserve that name with the MOC. Upon successful reservation, the reserved name is valid for two weeks from the approval date, renewable for another two weeks before any person can reserve and use it.
Generally, parties can choose a company’s name so long as it is not identical or similar to another name that has already been registered with the MOC.
On 12 August 2021, the MOC issued Prakas No. 0169 on the Usage of Abbreviated Words to Identify the Legal Form of Companies (“Prakas 169”). Under Prakas 169, the MOC clarifies that a private limited company or public limited company is not allowed to use the word “Holding” or “Group” as its company name, except if the following conditions are met:
- For using the word “Holding”, it must (i) have at least three subsidiaries duly registered in Cambodia, (ii) have business activity code of 642 (activities of holding companies) as its business objectives and provide capital to its subsidiaries to do the business as it cannot directly carry out business in Cambodia, (iii) hold at least 51% shares with voting rights of each of its subsidiaries.
- For using the word “Group”, the same conditions of items (i) and (iii) above must be met.
Further, the MOC is requiring new corporate entities to put their legal form at the end of or below their name by using the words or abbreviations below:
- Private limited companies – include the words “Private Limited Company” or the abbreviation “LTD” at the end of or below the name.
- Public limited companies – include the words “Public Limited Company” or the abbreviation “PLC” at the end of or below the name.
- Sole proprietorships – include the words “Sole Proprietorship” before the name.
- Local branches – include the name of the principal in the name and the words “Local Branch” above or before the name.
- Foreign Branches – include the name of the principal in the name and the words “Foreign Branch” above or before the name.
- Commercial representative offices and commercial relations offices – include the name of the overseas company in the name and the words “Foreign Commercial Representative Office” or Foreign Commercial Relations Office” above or before the name.
- General partnerships – include the words “General Partnership” or the abbreviation “GP” at the end of or below the name.
- Limited partnerships – include the words “Limited Partnership” or the abbreviation “LP” at the end of or below the name.