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Things to know before shipping cars and other vehicle parts to Cambodia

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Cambodia, a country experiencing remarkable economic growth, has seen a surge in imports, with vehicles and their components occupying a significant position among them. Why? Because as the nation prospers, the demand for efficient and affordable transportation solutions is on the rise. Moreover, with growing income levels, the demand for new cars, specifically, increases further, making Cambodia's vehicle market dynamic and promising.

As a matter of fact, around 54,000 cars are sold annually in Cambodia, but a significant majority of these are imported used vehicles. Amongst these, popular choices include four-wheel-drive vehicles and mid-sized Japanese sedans. 

Given this evolving landscape, understanding the shipping process for cars and vehicle parts is crucial.

Why are cars so expensive in Cambodia?

The high cost of cars in Cambodia is a challenge that stems from a circular problem, creating a complex and never-ending cycle. 

Cambodia's dependency on imports, due to the lack of local manufacturing facilities, drives up car prices. While the Cambodian government has taken steps to establish new vehicle manufacturing plants in the country, aiming to reduce the over-reliance on imports, the potential lowering of car prices will probably only occur in the future. This current absence of local production thus forces the country to still heavily rely on imports to meet the growing demand for automobiles.

In response, many consumers turn to the grey market. Many cars are imported second-hand, often arriving in the country as scrap and then being resold within its borders. Unauthorised dealers operating within this grey market frequently circumvent taxation, such as the 10% Value Added Tax (VAT). This, in turn, puts pressure on the government to enhance tax collection efforts. 

For example, the General Department of Taxation in Cambodia has stepped up efforts in 2023 to ensure compliance with tax obligations. They have initiated the collection of taxes on all means of transportation and vehicles, spanning from June 1 to November 30 2023, to foster transparency and fair competition in the car sales business.

This ongoing cycle underscores the need for individuals and businesses to stay informed about changing regulations and to follow the necessary steps diligently when purchasing or importing cars in Cambodia. 

How to import cars and other automotive parts into Cambodia

Navigating the process of importing cars and automotive parts into Cambodia requires attention to detail and adherence to specific guidelines. After all, international shipping, especially of bulky and irregularly shaped automobile components, demands careful consideration. 

Consider these essential steps to ensure a smooth and compliant importation process for cars, car accessories, and car spare parts into Cambodia.

1. Understand Cambodia’s car import regulations and requirements

Before embarking on the journey of importing cars and automotive parts into Cambodia, it's crucial to understand the country's import regulations and requirements. 

Here are the key steps and considerations:

Customs formalities

Goods imported into Cambodia must go through customs formalities. This process includes the payment of any applicable duties, taxes, fees, and a security deposit. Familiarise yourself with the specific customs requirements based on the nature of your import.

Business registration

Both importers and exporters must register with Cambodia's Department of Business Registration, which operates under the Ministry of Commerce. This registration is a fundamental step in conducting import/export activities in the country.

Taxpayer Identification Number (TIN)

Cambodia employs the Automated System for Customs Data (ASYCUDA), a system developed by the United Nations Conference on Trade and Development (UNCTAD). To participate in this system, importers and exporters need a TIN. Acquiring a TIN involves registering with the General Department of Taxation, part of the Ministry of Economy and Finance.

Customs registration

Furthermore, importers and exporters are obligated to complete their registration with the General Department of Customs and Excise (GDCE). This registration ensures compliance with customs procedures and regulations.

VAT account

Register your VAT account with the General Department of Taxation, which also falls under the Ministry of Economy and Finance. Understanding and fulfilling VAT obligations is crucial for your importation process.

Special Economic Zones (SEZs)

If your business activities are situated within Special Economic Zones (SEZs), like the Phnom Penh SEZ, it is essential to initiate the application process through the Free Zone Management Department under the jurisdiction of the GDCE, headquartered in Phnom Penh. SEZs may have specific regulations and benefits for importers and exporters.

2. Ensure all the required documents are provided

Importers and exporters dealing with the GDCE must submit declarations along with essential documentation. These typically include a bill of lading/air way bill, packing list, invoice, proof of insurance, an inspector's report of findings if applicable, and any other requested documents.

When it comes to vehicles and car body parts, these documents often comprise:

  • Original Bill of Lading (BL) or Express BL (from the point of origin) and Through Bill of Lading (from the transhipment point)
  • Commercial invoice
  • A clear copy of the shipper's passport with the photo page

3. Pay the relevant import duties

In adherence to customs regulations, Cambodia imposes specific import duties and taxes that vary depending on several factors.

Duty and tax exemptions

Certain individuals, such as diplomatic, UN, NGO, and IO staff, can attain duty and tax exemptions when importing cars. However, this privilege requires prior approval from the relevant ministries upon their arrival.

General importers

Importers who do not fall within the aforementioned exempt category are subject to duty and government taxes. The exact rates of which depend on factors like the type, age, and engine size of the imported car.

Tariff rates

Cambodia's tariff rates span from 0 to 35%. Finished products, as well as items such as vehicles, are subject to a tariff rate of 35%.

VAT

Cambodia applies a flat 10% VAT on all imported goods.

To accurately calculate the tax and estimate for customs duties on vehicle imports in Cambodia, you can conveniently access this information via the official website of the GDCE. 

4. Identify any restrictions and prohibitions

While Cambodia does not have specific restrictions or prohibitions related to cars, there are certain regulations and considerations to keep in mind when importing vehicles and other goods, such as car body parts. 

  • Left-hand drive requirement: Importers of motor vehicles should note that vehicles must be left-hand driven in Cambodia.
  • Diplomatic ID card: If you are importing vehicles as part of diplomatic or official duties, your destination agent will require a diplomatic ID card to facilitate the customs clearance process. 

5. Engage the right car shipping services

Not sure how much it costs to ship a vehicle to Cambodia? When it comes to shipping car parts and accessories internationally, several factors can influence the cost and reliability of the service. 

Here's what you need to consider when trying to figure out the cheapest way to ship cars and other small or large car parts:

Cost factors

The cost of shipping automotive parts internationally can vary based on factors such as the weight and dimensions of the package, available delivery times, and the shipping company's pricing structure. To find the most cost-effective option, it's advisable to compare quotes from different courier companies and providers.

Reliability is key

Ensure that you choose a shipping service with a proven track record of safe and timely deliveries.

Customs expertise

International shipping often involves customs procedures and regulations. Partnering with a shipping service that has expertise in navigating customs requirements for car parts and accessories can save you time and potential hassles.

Insurance coverage

Consider whether the shipping service offers insurance coverage for your items. This can provide peace of mind in case of loss or damage during transit.

Tracking and support

Opt for a shipping service that provides package tracking and customer support. Being able to monitor the progress of your shipment and having access to assistance when needed can be invaluable.

Trust DHL Express for seamless car and auto parts shipping

When it comes to finding a reliable logistics partner for your car and auto parts shipping, look no further than DHL Express

At DHL Express, we take pride in our extensive worldwide delivery network spanning 220 countries and territories. This global reach positions us as the ideal choice for auto part shipping requirements. Our commitment to excellence means that every consignment of auto parts you send or receive is handled with precision and care.

What sets us apart is our end-to-end tracking visibility, providing you with real-time updates on your shipments as they traverse the globe. With DHL Express, you're always in the know about the status and location of your auto parts in transit.

Need urgent time-sensitive shipments? We've got you covered. We specialise in catering to global customers who require specific car parts delivered as swiftly as possible, even on the same day.

Take the next step with a business account to discover how we can elevate your auto part shipping experience to new heights.