Harrison White
The Trust Regulator of Cambodia has officially approved inaugural licenses for six companies to operate trust businesses in the Kingdom. The announcement was made during the “Trust Forum 2023” event held at the Phnom Penh Hotel, which aimed to disseminate progress in the development process of the trust sector in Cambodia to relevant stakeholders.
The six licensed trust companies are:
- Stronghold Trustee Ltd.
- Cana Trust Ltd.
- Phillip Trustee (Cambodia) Ltd.
- Hao Trust Capital Investment Ltd.
- SG Top Ltd.
- Grand Cathay Investment Trust.
Each company has completed all necessary requirements in accordance with the relevant regulations in the trust sector.
Advancement of Cambodia’s trust sector
Sok Dara, Director General of the Trust Regulator, said that the advancement of the trust sector is a new chapter for development in Cambodia and has attracted a lot of attention from the private sector. “The trust sector has played a crucial role in contributing to and driving inflows of investment in all sectors of the economy,” Dara said at the Trust Forum.
According to a report from the Trust Regulator, as of February 2023, 492 trusts were registered in Cambodia with a total investment fund of $735 million. Commercial trusts accounted for the majority of registrations, with 475 trusts and a total investment fund of $492 million, or 66 percent of all registrations.
Financial trusts and individual trusts had nine and six registrations, respectively, with investment capital of $175 million and $2 million. One public trust was registered with a capital investment of $64 million, while one social trust registered $1 million.
Dara said that the trust sector’s success in Cambodia has been evident in its short development period, adding that the country now has the priority of the trust market with full operation. “Through this achievement, the Trust Regulator can assess that in the short period of development of the trust sector in Cambodia has been successful,” Dara said.
2019 Trust Law still has taxation questions
The 2019 Trust Law governs the establishment, registration, management, and control of four types of trusts in Cambodia: Commercial Trust, Public Trust, Social Trust, and Individual Trust. The law contains comprehensive regulations and rules to govern the rights, duties, and responsibilities of the trustor, trustee, and beneficiary, providing a comprehensive understanding of each type of trust and its purpose.
The Trust Forum 2023 focused on presentations and discussions on the legal framework, types of trust operation, and opportunities in the Cambodian market. His Excellency Mey Vann, Secretary of State of the Ministry of Economy and Finance and Secretary-General of the Secretariat of the Non-Bank Financial Services Authority, said, “This is an exciting time for the trust sector in Cambodia, and we hope to see continued growth and development in this area.”
However, for many of the attendees’ questions there was still a lack of details provided by Cambodia’s General Department of Taxation on taxation implications that have raised more questions than answers for investors who would like to use the framework but are unsure of both the short and long-term tax implications.
Read more: Investors seek tax clarification on Cambodia’s developing trust law framework
The event was attended by approximately 200 participants representing over 100 national and international institutions and companies from the financial sector, real estate, and law. The Trust Regulator’s announcement of the six licensed companies is expected to further attract foreign investors to Cambodia’s trust sector, providing more opportunities for the country’s economic growth.
