Tom Starkey
The American Chamber of Commerce in Cambodia (AmCham) held its first annual Business Law Conclave in Phnom Penh at the Hyatt Regency. The event was organized by AmCham’s Law Committee with support from the Ministry of Justice and was sponsored by Tilleke & Gibbins (Cambodia) Ltd., BNG Legal, and the American University of Phnom Penh.
The goal of the Conclave was to provide important legal insights to businesses operating in Cambodia and to promote collaboration between AmCham, the Ministry of Justice, and other organizations.
AmCham President Anthony Galliano opened the conclave and emphasized the importance of understanding the laws and regulations of Cambodia and the need for AmCham to be involved in shaping these laws for the benefit of the country.
Read more: Firms in Cambodia are increasing their use of commercial arbitration standards
Proposed the establishment of a commercial court in Phnom Penh
Keynote speaker H.E. Chiv Songhak, Secretary of State at the Ministry of Justice, spoke about the government’s efforts to promote sustainable and inclusive development through trade and investment. He acknowledged that with increased trade and investment, disputes can also escalate, which is why the government has proposed the establishment of a commercial court in Phnom Penh.
H.E. Ly Tayseng, Advisor at the Ministry of Justice, commented on the need for an effective dispute resolution mechanism for commercial disputes in Cambodia and the government’s plans to create an independent commercial court. He emphasized that amendments to the current commercial procedure law will be necessary to define commercial matters and create a fair, efficient, and corruption-free court.
Businesses seek clarification on advertising and e-commerce laws
Mr. Jay Cohen from Tilleke & Gibbins in Cambodia spoke about recent changes in e-commerce and website law. Companies are required to use a .com.kh domain name and email address, which must be provided to the Ministry of Commerce.
“Although other domain names can still be used commercially, new regulations state that a .com.kh domain name/e-mail address will be required when submitting a company’s Annual Declaration of Commercial Enterprise. We anticipate that other ministries may also begin requiring the use of a .com.kh,” he said.
“The fees for obtaining a domain name are around 100 USD with an annual renewal fee of 30 USD. Domain names can be obtained from www.domain.gov.kh. In addition, websites are now considered a form of advertisement and therefore there may be restrictions on certain content, such as anything that affects national security. Currently, websites do not need a license or permit,” he added.
Mr. Matt Rendall, the Managing Partner at Sok Siphana & Associates, talked about new advertisement laws in Cambodia. These laws require advertisers to get a license for advertising commercial goods and services, and they must follow regulations for accuracy and appropriateness. Advertisements also have to be in Khmer or a dual language with Khmer being bigger.
“The new laws have banned certain content and have penalties, but compliance certificates can protect against them. However, there is still confusion about online advertisements and if they need to be approved by the Ministry of Commerce,” he added.
New laws aim to ensure the accuracy and appropriateness
Additionally, Matt mentioned that these new advertisement laws will present challenges and one of the main challenges is determining if an online advertisement needs approval from the Ministry of Commerce. Despite these challenges, the new laws aim to ensure the accuracy and appropriateness of advertisements and protect consumers.
Mr. Jay Cohen added that in Cambodia, both intermediaries (such as internet and e-commerce platforms) and e-commerce service providers (like online stores and SAAS) are regulated under the E-Commerce Law. To get a license, companies need to obtain an online service provider certificate from the MPTC and an e-commerce license from the MOC, while sole proprietors need to get e-commerce authorization from the MOC.
Foreign companies conducting e-commerce business in Cambodia must comply with related tax regulations if their turnover is over 62,500 USD per year such as Sub-Decree 65, Prakas 542, and Instruction 2520. These regulations broadly require a foreign offshore company to register with the GDT and pay VAT on their Cambodian-based transactions.
Updates on Consumer Protection and Competition in Cambodia
As for the Law on Consumer Protection, Ms. Sok Vanseka provided brief highlights on the Prakas on Unfair Contract Term, which requires the business operators not to put any unfair contract clause in their standard form of contract based on the abuse of circumstances that the consumers cannot negotiate or request for making any change on such form of contract.
The unfair contract clause consists of any clause that provides an excessive advantage to the business operators or provides an excessive disadvantage to the consumers. Furthermore, such standard form of contract shall be prepared in the Khmer language in a clear and precise manner as the consumers may demand further explanation on terms and any change on material terms shall be subject to prior consent from the consumers.
Ms. Sok Vanseka also took the opportunity to highlight briefly the Prakas on Cooling Off Period, which mandates the business operator to grant the right to the consumers to return any goods and services (except for certain goods and services as excluded by the Prakas) in 7 days upon receipt without any justification for any distance sales or door-to-door sales of goods and services.
In response to the audiences from the food and beverage sector, Ms. Sok Vanseka has briefly noted the enactment of the new law on food safety and the Prakas on Minimum Information Standard, which permits of the use of QR codes for complying with the labeling requirements.
Furthermore, Ms. Sok Vanseka also noted the recent issuance of regulations on investigation and negotiated settlement under the Law on Competition on any horizontal agreement, vertical agreement, market dominance, and merger and acquisition that negatively impact competition in Cambodia.
AmCham Legal Committee Board in 2023
- Mr. Ruwan Hulugalle, Chair
- Mr. Jay Cohen, Vice Chair for Technology, Media and Telecommunications (TMT)
- Mr. Varabott Ho, Vice Chair of Banking & Insurance Legal & Regulatory Compliance
- Ms. Sok Vanseka, Vice Chair for Trade and Investment
- Mr. Sofok Sorng, Vice Chair for Commercial Law
- Ms. Kat Smith, Vice Chair for Legal Education
- Ms. Mutiah Fauzan, Co-Secretary
- Ms. Kimpheng Kong, Co-Secretary
Read more: Ruwan Hulugalle elected as the inaugural AmCham Legal Committee Chairman
The committee chair told Cambodia Investment Review after the event the goal of the Law Committee is to improve the business environment by promoting legal compliance and capacity development as well as helping to shape future laws and regulations to be more business-friendly.
“While the legal fraternity naturally embraces more regulation, it is equally important that these measures don’t become overly burdensome to doing business in Cambodia. I hope that we can continue to bring to the table decision-makers and businesses to engage on critical issues like we’ve done through the inaugural Business Law Conclave,” he added.
