An influential lineup of speakers, including three senior DFDL experts, explained the fundamental elements of Cambodia’s 2019 Law on Trusts and how it pertains to a range of taxation issues at a breakfast workshop on 30 August 2022 in Phnom Penh.
The high-level Trusts and Taxes seminar, which was jointly sponsored by DFDL, IPS Cambodia and Stronghold Trustee, was organized by the American Chamber of Commerce in Cambodia (AmCham) and chaired by Anthony Galliano, the president of AmCham.
The keynote address was delivered by H.E. Sok Dara, director general of the Trust Regulator of the Ministry of Economy and Finance, who shared the Royal Government’s emphasis on developing trust funds in Cambodia.
The next two presentations were from DFDL experts: Vansok Khem (Partner and Deputy Head of Corporate and Commercial Practice Group), who gave an insightful overview of Cambodia’s Law on Trusts, and Jonathan Blaine (Co-Head of Regional Compliance and Investigations Practice, and DFDL Tax Director), who gave historical background on trusts before delving into the complex issue of how trusts are taxed in Cambodia and Southeast Asia.
As Vansok Khem explained, the 2019 Trusts Law clearly defined the types of trusts that could be registered in Cambodia, including commercial trusts, which are for profit, and public trusts, which are created by development partners and managed by local financial institutions. She also discussed social trusts, which are non-profit and generally used for education, scientific or religious purposes, and individual trusts.
“The question in Cambodia is that there are not yet any tax rules for trusts, so what ones are they going to adopt?” Jonathan Blaine said, adding “I would expect the [government] revenue department to find the simplest way to tax trusts because they are under time pressure. Then, that tax law will probably morph into a more sophisticated law.”
The event continued with a panel discussion and Q&A moderated by Clint O’Connell (DFDL Partner and Chairman of AmCham Tax Committee). The panel of experts included Chhean Sokhary, director of the Department of Legal Affairs and Inspection for the Trust Regulator, Hans Chen, the general manager of Stronghold Trustee, and Adam Fitzpatrick, country director of IPS Cambodia