Fair Customs Duty Treatment for European Vehicles

The Royal Government of Cambodia, through the Ministry of Economy and Finance, has decided to remove customs import duties on vehicles imported directly from the United States of America. According to Prakas No. 632 MEF.BrK of the Ministry of Economy and Finance, outlines the implementation of a 0% customs duty on qualifying new goods directly imported from the United States.  

In addition, at the same day, the General Department of Customs and Excise issued an Instruction No. 3724/25 GDCE on Customs Formality Procedures for Goods Originating From the United States of America and Imported From the United States of America. The instruction saw the conditions for 0% customs duty on vehicles to be imported to Cambodia. In order to get 0% customs duty, the vehicles shall meet the following conditions:  

On the same day, the General Department of Customs and Excise issued Instruction No. 3724/25 GDCE on Customs Formality Procedures for Goods Originating from and Imported from the United States of America. The Instruction sets out the conditions under which vehicles imported into Cambodia are eligible for a 0% customs duty. 

To qualify for the 0% customs duty, the vehicles must meet the following conditions: 

• • Manufactured in the United States of America,  

• • Shall be vehicles with the model year of 1 year before the current year (N-1), or of the current year (N), or of 1 year after the current year (N+1), and have a usage distance not exceeding 5,000 kilometers on the car’s odometer, and  

• • Shall be vehicles that are in good condition in original form that are not dented, collided, damaged, flood-damaged, or affected by other incidents.   

The implementation of a 0% customs duty on US-origin vehicles creates an unequal competitive environment for European automotive brands represented by authorised distributors and investors operating in the Cambodian market.  

The authorised distributors of European brands continue to import vehicles under the standard customs tariff regime, with very expensive car value, resulting in higher landed costs compared to US-origin vehicles that benefit from duty-free treatment. This price gaps directly affects market competitiveness, sales volumes, and profitability for European brands in Cambodia. 

The unequal tariff treatment weakens the business case for long-term investment by authorised distributors in critical downstream activities, including after-sales service networks, spare parts availability, technical training, warranty support, and compliance with safety and environmental standards. Furthermore, the unequal tariff treatment creates uncertainty for distributors and investors, discourages future investment, and reduces Cambodia’s ability to attract and retain reliable automotive distributors that support skills development, consumer protection, and a stable market.