2016 03 March

Cambodia Law Update for March 2016

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  • Promulgation of the Law on Telecommunications
  • Rules and procedures of resolving tax claims at the General Department of Taxation of the Ministry of Economy and Finance
  • Tax mechanism for operation of financial leases
  • The enhancement of the implementation of the law on negotiable instruments and payment transactions
  • Standard of public services of the Ministry of Economy and Finance
  • Provision of public services of the Ministry of Public Works and Transports
  • Provision of public services and transitional fines in cash by the Ministry of Mines and Energy
  • Provision of incentives on collecting revenues from public services by the General Department of Financial Industry of the Ministry of Economy and Finance
  • Provision of public services of the General Department of Public Procurement of the Ministry of Economy and Finance

TELECOMMUNICATIONS

PROMULGATION OF THE LAW ON TELECOMMUNICATIONS, Royal Kram № NS/RKM/1215/017 (Royal Palace) 17 December 2015

The Law on Telecommunications has been promulgated, and is intended to ensure the use of infrastructures/facilities and networks, and the provision of telecommunications services with effectiveness, safety, quality, and reliability in response to social and economic development needs, encourage the private sector in developing the telecommunications sector, and protect users and promote the national budget revenue collection.  This law addresses such issues as management competence and use of infrastructures and networks, quality standards of service and telecommunications equipment, universal access, national telecommunications numbering plan and electronic addresses, rules on telecommunications service pricing and legal and fair competition, and rights of telecommunications operators, persons related to the telecommunications sector, and users.

The Telecommunication Regulator of Cambodia (TRC) is obligated to perform its functions and duties and will have autonomy in administrative and regulatory matters as well as having independence from telecommunications operators and persons in relation to the telecommunications sector.

Only those persons and entities properly authorized, by way of permission letter, certificate, or license by the TRC, may engage in telecommunications operator services.

The Ministry of Posts and Telecommunications (MPTC) is responsible for networks and infrastructure supporting the telecommunications sector.

Within 1 (one) year following the entry into force of this law, telecommunications operators and persons involved in the telecommunications sector are required to complete new formalities with the TRC in order to apply for an authorization, certificate or license to comply with this law and any other regulations.

TAXATION

RULES AND PROCEDURES OF RESOLVING TAX CLAIMS AT THE GENERAL DEPARTMENT OF TAXATION OF THE MINISTRY OF ECONOMY AND FINANCE, Prakas № 1470 (MEF) 6 November 2015

This prakas aims to ensure the transparency, honesty, fairness, perfection, and punctuality in resolving tax claims of taxpayers and withholding agents. The objectives of this prakas are to determine rules and procedures for submitting and resolving claims of taxpayers and withholding agents with the General Department of Taxation of the Ministry of Economy and Finance.

A claimant, who is not satisfied with a tax determination, tax re-determination, demand of tax debts, decision or other rule of the General Department of Taxation, is entitled to submit a claim to the General Director of the General Department of Taxation within 30 working days commencing from the date of receiving notice of a decision or other rule of the General Department of Taxation.

TAX MECHANISM FOR OPERATION OF FINANCIAL LEASES, Prakas № 1704 (MEF) 9 December 2015

The purpose of this prakas is to determine the tax mechanism for operation of financial leases in order to promote and develop the financial lease sector, and sets out certain requirements and restrictions related to the property which is the subject of the lease, ownership of the property by the lessor, duration of the lease period, and limitations on the lease amount as a proportion of the value of the property.

The prakas further outlines tax compliance and reporting obligations of the lessor and the lessee in relation to VAT, tax on profit, minimum tax, etc.

BANKING

CIRCULAR ON THE ENHANCEMENT OF THE IMPLEMENTATION OF THE LAW ON NEGOTIABLE INSTRUMENTS AND PAYMENT TRANSACTIONS, No.B7-016-002 (NBC) 11 February 2016

This Circular is issued by the National Bank of Cambodia (NBC) for the purpose of enhancing the implementation of the Law on Negotiable Instruments and Payment Transactions (LNIPT) promulgated on 24 October 2005. In order to ensure the effectiveness of payment transactions, and to improve the reliability of negotiable instruments, the NBC instructs banks and financial institutions (BFIs) to ensure that their staffs are aware of the regulations set in the LNIPT, notably related to the issuance, the use, and the payment of cheques. Further, the BFIs are required to instruct theirs customers clearly about the terms and procedures of issuing and using cheques correctly. Also, the BFIs must record and report back to the NBC within two days in case there is insufficient funds in the relevant account to cover a cheque.

In the event of failure to comply with this circular, rules, and procedures in relation to negotiable instruments and payment transactions, BFIs will be subject to penalty provided in laws and regulations in force.

FINANCE

STANDARD OF PUBLIC SERVICES OF THE MINISTRY OF ECONOMY AND FINANCE, Prakas № 1823 SHV .Br.K (MEF) 25 December 2015

This prakas aims to ensure effectiveness, effect, transparency and accountability of providing public services which are subject to the competence of the Ministry of Economy and Finance (“MEF”).

Public services refers to the services, which are provided by the General Department and the subordinated entities of the MEF according to the functions and duties in force, for the purpose of serving public interest to the public who are physical persons or legal persons by charging fees or without charging fees.

The General Secretariat of the MEF has the duty to prepare, compile and publish the series of public services of the MEF for official use and public dissemination.

A one-stop service is to be established to be used as a place for collecting information, providing information, and for provision of public services of the MEF. The one-stop service is to be directed and facilitated by the Department of Administration and Finance of the General Department and supported by the General Department and relevant entities of the MEF.

Information on service fees, duration within which services are to be provided, and procedures for filing a complaint are to be widely disseminated and easily accessible.

PROVISION OF PUBLIC SERVICES OF THE MINISTRY OF PUBLIC WORKS AND TRANSPORTS, Joint Prakas № 010 SHV .Br.K (MEF) 21 January 2016

This prakas permits the Ministry of Public Works and Transports (“MPWT”) to implement the collection of revenue from public service fees for the benefit of national budget. Public services, which are provided by the MPWT, along with fees for services, are set out in an annex to this prakas.  This prakas supersedes any and all prior regulatory instruments which are contrary to it.

The MPWT must publicly disseminate/publish, including at the place for providing public services, this prakas and its annex, and the document form and procedure for requesting services. Further, at the place of providing public services, there must also be a place for accepting claims/complaints which may arise particularly in case of incorrectly implementing services or taking fees exceeding those stated in the annex.

PROVISION OF PUBLIC SERVICES AND TRANSITIONAL FEES IN CASH BY THE MINISTRY OF MINES AND ENERGY, Prakas № 1451 (MEF) 3 November 2015

This prakas permits the Ministry of Mines and Energy to implement the collection of revenues from public services and the transitional fees in cash for the benefit of the national budget. The public services provided by the Ministry of Mines and Energy, fees for such services, and the duration in which services are to be provided are set out in this prakas.

Under this prakas, official receipts for payment for public services must be issued by the Ministry of Economy and Finance in accordance with Prakas № 272 SHV.Prk, dated 17 March 2011, on the implementation of payment receipt and instructional circular № 005 SHV, dated 17 March 2011, on management of payment receipt of the Ministry of Economy and Finance.

INCENTIVE BONUS FOR COLLECTING REVENUE FROM PUBLIC SERVICE FEE BY THE GENERAL DEPARTMENT OF FINANCIAL INDUSTRY OF THE MINISTRY OF ECONOMY AND FINANCE, Prakas № 1150 (MEF) 15 September 2015

This prakas permits the General Department of Financial Industry to withhold certain portions, as bonus, by deducting from revenue it generates from public services as determined by Prakas № 1149 SHV.Br.K, dated 15 September 2015, on Provision of Public Services of the General Department of Financial Industry of the Ministry of Economy and Finance.

The bonuses are to be distributed as follows:

  1. 50% of the revenue collected from administrative service fee is paid to national budget;
  2. 49% of the revenue collected from administrative service fee is paid to the General Department of Financial Industry; and
  3. 1% of the revenue collected from administrative service fee is paid to the General Department of State Property and non-tax revenue.

PROVISION OF PUBLIC SERVICES OF THE GENERAL DEPARTMENT OF PUBLIC PROCUREMENT OF THE MINISTRY OF ECONOMY AND FINANCE, Prakas № 1148 (MEF) 15 September 2015

This Prakas permits the General Department of Public Procurement to implement the collection of revenue from the public service fees for the benefit of national budget. The public services provided by the General Department of Public Procurement is to be provided in a list of public services with the details of service price, service period, and validity according to each type of public service as set out in the schedule attached to this Prakas.

The General Department of Public Procurement must publicly announce, especially at the service place, the standard of services, including: the list of public services and documents related to the provision of public services and must also prepare place(s) for receiving complaints which may eventually arise, especially in case of implementation contrary to the standard of service or in case of any fee charge exceeding the set amount or any delay.

The General Department of Public Procurement must determine a clear location to act as a one-stop service center in order to serve customers in a timely manner.

DFDL Contact:
Alex Larkin
Senior Adviser
alex.larkin@dfdl.com

*The information is provided for information purposes only, and is not intended to constitute legal advice. Legal advice should be obtained from qualified legal counsel for all specific situations.