CAMBODIA

Notification on the Implementation of Labour Self Inspection Regime Via Automated System

On 27 May 2022, the Ministry of Labour and Vocational Training ("MLVT") issued Notification No. 022/22 MLVT/NOTIF.DLI on the Implementation of Labour Self Inspection Regime via Automated System ("Notification"). Following the issuance of the Notification, MLVT would like to draw the attention of the owners or directors of all companies which are duly registered under the laws of the Kingdom of Cambodia and covered by the Labour Law to the following obligations:

1. conduct labour self-inspection (LSI) via the automated system (link here) twice a year, before (i) end of June, and (ii) end of December, starting from June 2022;
2. comply with the 31 priority points provided in the Constraint Letters (please refer to Annex A of our Legal Update titled "The Notification on the Implementation of Labour Self Inspection Regime Via Automated System"), as failure to comply with any of such priority points will immediately subject the errant owner or director to fines; and
3. encourage employees to be fully vaccinated against COVID-19 to enable companies to carry out their businesses, and fill in the vaccination information relating to their employees in the system.

Non-compliance with the above obligations will subject the errant owners or directors of companies to fines or other forms of punishment as may be prescribed by law. MLVT may also institute legal action against them for non-compliance with the said obligations.

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New Draft Law on Technology Transfer

The Ministry of Industry, Science, Technology, and Innovation ("MISTI") has been discussing the draft Law on Technology Transfer ("Draft Law") with other relevant institutions and authorities. The Draft Law aims to manage, stimulate, and promote the transfer, export, and import of technology among public and private institutions and non-governmental organisations.

If the Draft Law is adopted, MISTI will be the regulatory authority leading, managing, facilitating, and promoting the transfer of technology in Cambodia.

Under the Draft Law, any person who performs technology transfer activities is obliged to obtain a license, permit, or certificate of technology transfer from MISTI and to annually contribute 1% of gross revenue to the technology research and development and innovation fund.

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Consumers to Have Right to Withdraw from Contract During Cooling-Off Period under New Prakas

On 11 April 2022, the Ministry of Commerce ("MOC") issued Prakas No. 0113 on the Cooling-off Period ("Prakas"), which sets out the legal framework that offers consumers the unilateral right to withdraw from a contract for the sale of goods or supply of services during the cooling-off period.

The Prakas applies to all distance and door-to-door sales of goods and/or services in Cambodia. Distance sales refer to indirect sale-purchase transactions conducted without the physical presence of the parties, where the consumer does not have an opportunity to inspect the goods and/or services. Door-to-door sales refer to sales-purchase transactions where the businessperson sells the goods and/or services at the consumers' location or at public places that are not the location of the businessperson. 

This Prakas will be implemented within six months after the date of its issuance by the National Commission for Consumer Protection with the Consumer Protection Competition and Fraud Repression Directorate-General as its arm.

The Prakas also provides for (i) the right to withdraw during the cooling-off period, (ii) the exceptions to the right of withdrawal, (iii) the consequences of withdrawal, and (iv) the penalties for non-compliance with the Prakas.

For more information, click here to read our Legal Update.

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Guidelines on Registration and Additional Approval for Trustee in CIS and Custodian in Securities Sector

On 30 March 2022, the Securities and Exchange Regulator of Cambodia ("SERC") and the Trust Regulator jointly issued a new set of Guidelines on Registration and Additional Approval for Trustee in Collective Investment Scheme ("CIS") and Custodian in the Securities Sector ("Guideline").

The Guidelines provides that a trustee in CIS must be registered as a 'trust operator’ in the securities sector with the Trust Regulator. A custodian in the securities sector who has obtained an approval-in-principle or final approval from SERC must apply for registration as a custodian of a trust fund in the securities sector with the Trust Regulator. 

The Guidelines also set out, among other things: (i) the application costs and expenses as well as annual registration fees; (ii) the grounds for suspension or cancellation of registration; (iii) the Trustees and Custodians' obligation to notify the Trust Regulator of any change or modification to information previously provided; and (iv) various obligations concerning business operations such as maintaining financial solvency ratios, reporting, notifications, requesting for approval and compliance with code of conduct.

For more information, click here to read our Legal Update.

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New Prakas on Unfair Contract Clause for Consumer Protection and Fair Competition

On 1 March 2022, the Ministry of Commerce issued Prakas No.0067 P.N.A.KBB.PRK on Unfair Contract Clause ("Prakas"). The Prakas will be implemented within six months after the date of its issuance.

The Prakas defines "Unfair Contract Clause" as any clause that: (i) allows business operators to gain excessive consumer benefit; and (ii) creates an extreme disadvantage to the consumer. The term "unfair" under this Prakas will be determined based on certain factors. In assessing whether a clause allows business operators to gain "excessive benefit" from the consumer, the following will be considered: (i) the circumstances of the parties or either party to the Standard Form Contract such as economic or social dominance, ignorance of either party, or similar circumstances; and (ii) the criteria imposed under sectoral regulations of the relevant ministries, institutions, or regulators.

A "Standard Form Contract" refers to a contract or material clause which is pre-formulated by a business operator for the provision of goods and/or services to the consumer, the terms of which do not allow the consumer to negotiate or revise the contract or influence the business operator in whatever form to amend the contract. The Standard Form Contracts issued by business operator must comply with the requirements set out by the Prakas. 

The Prakas also stipulates that consumers have certain rights under the Standard Form Contracts including (i) the right to access necessary information relating to the goods and/or services provided by the business operator, as well as the clauses of the Standard Form Contract; (ii) the right to ask for clarification before entering into the contract; and (iii) the right to rescind or ratify any clause that is unfair and give excessive benefit to business operators. 

For more information, click here to read our Legal Update.

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