Brief Introduction to Cambodia's Land Law System

1. Progress of Cambodia’s land law formulation

During the Khmer Rouge regime from 1975 to 1979, Cambodia experienced the expropriation of private land and the destruction of most land ownership certificates. The government established a collective land ownership system and moved most of the population to rural agricultural production areas. With the development of the market economy, the government redistributed land to individuals. The Cambodian Parliament enacted the Land Law in 1992 to establish the real estate property rights system and promote the modernization of the land registration system. At this time, Cambodia's national economic system has gradually shifted to a market economy. The government began to pay attention to investment in concessionary economic zones in industrial and agricultural planting areas and granted land concessions to private enterprises. To this day, many Cambodians have not been able to obtain official land registration certificates. The reason for this is that on the one hand, the registration fees and tips are too high, and on the other hand, the government excludes controversial land during the registration process, thereby greatly reducing the effectiveness of the land registration system.

2. Cambodia’s Land Legal System

At present, Cambodia's land law system mainly comes from the Land Use Planning, Urbanization and Construction Law, the Land Law and its sub-regulations, such as Decree No. 19 on Social Concessions, Decree No. 114 on Mortgage and Transfer of Long-term Lease Rights, Decree No. 146 on Economic Concessions, etc. The main contents of these laws and regulations include: regulating ownership, land licensing, leasing, co-ownership, guarantees and other systems. It should be noted that Cambodia's land laws are greatly influenced by government policies. For example, in 2012, President Hun Sen announced the suspension of the issuance of new economic land concessions, which caused the relevant provisions in the Land Law and the Economic Concessions Decree to fall into a dilemma.

Land ownership system

According to Cambodian land laws, land ownership systems can be divided into three types: state-owned, collectively owned and privately owned. Among them, the state in the land ownership system can be further subdivided into two types, land as state public property and state private property, and depending on whether it is transferable.

1. Land ownership classification

1. State-owned public land:

According to Article 15 of the Land Law, state-owned land can be divided into seven categories, as follows:

• Pristine natural property, including forests, waterways, natural lakes, dams, rivers and coasts.
• Property that is generally provided for public use includes docks, ports, railways, train stations, airports and other infrastructure, as well as naturally formed or constructed property provided for public use, including streets, parks and protected areas.
• Property provided for public use includes public schools and hospitals, educational colleges and administrative centers.
• Become an asset of the nature reserve according to law.
• Historical sites, buildings and culture.
• Real estate that belongs to the Crown but is not private property.

2. Collective-owned land

There are two types of collective land in Cambodia:

(1) Monasteries:

In Cambodia, land in a monastery belongs to the religion and its heirs in perpetuity. Monastery real estate cannot be sold, exchanged or donated, but can be rented or leased as long as the income is used exclusively for religious affairs. Monastery land is not governed by government decree, and representatives of the Religious Council protect the property. The Ministry of Culture and Religious Affairs of Cambodia has the power to establish protective measures for the process of selecting the Religious Council and its representatives. However, the land and property of other religions are not subject to this restriction and are managed by the corresponding religious associations in accordance with the law.

(2) Hill tribes:

The indigenous groups living in Cambodia have distinct religious, cultural, social and economic characteristics. Before the legal status was determined, they lived in a traditional way and cultivated their own land. According to traditional customs and laws, the indigenous groups have the responsibility to manage their own society and real property.

Land titles are granted to indigenous groups by the state in the form of collective titles, which include the same rights and protections as private land titles. However, they do not have the right to transfer collective titles to individuals or groups because the land is considered public property of the state.

In order to promote the cultural, economic and social advancement of members of the Aboriginal group and enable them to freely leave the group or release themselves from bondage, some lands may be transferred to individual ownership. This is intended to provide greater flexibility and opportunities for Aboriginal group members to develop and grow on a personal level.

Non-Indigenous groups cannot acquire Indigenous group real property rights. This means that outside organizations or individuals cannot own or control Indigenous group land resources.

3. State-owned private land

Private land belonging to the state and government agencies can be exchanged, distributed, sold and transferred, and can also be rented and contracted in accordance with the law. The conditions and procedures for the sale and management of private property of state and government agencies shall be in accordance with the law. If there is no corresponding regulation, it cannot be sold. State private land can be transferred in accordance with the conditions stipulated in Chapter 5 of the Land Law.

4. Privately owned land

Private individuals can acquire land ownership through purchase, gift, exchange or inheritance, etc. However, land ownership may be deprived after complying with legal and regulatory procedures and making fair compensation, provided that it does not harm the public interest.

In order to safeguard the sovereignty of the country's territory, Cambodian land law strictly prohibits foreigners from owning land. Only individuals or legal persons of Cambodian nationality are eligible to own land.

In Cambodia, whether a registered company is considered Cambodian or not depends on the nationality of the controlling shareholder. If the nationality of the controlling shareholders exceeds 51% in total, the company will be considered Cambodian. The law also prohibits changing the equity structure through private agreements, so foreign investors cannot actually obtain land ownership through proxy shareholding agreements, etc.

For foreign investors , legal ways to use land in Cambodia include land concessions and long-term and short-term leases. Moreover, the practice of transferring land to Cambodian individuals or legal person investors to indirectly obtain land ownership may increase the risk of legal disputes.

2. Acquisition of Land Ownership

The ways to acquire land ownership are as follows:

1. Possession

Since 1989, Cambodia has recognized that possession that meets certain conditions can constitute ownership of real property. According to Article 30 of the Land Law, any person who has occupied privately owned real property in a peaceful and undisputed manner for not less than 5 years before the Land Law came into effect has the right to apply for a document that clearly proves ownership. If the document granting ownership is opposed, the person must prove that he acquired the real property in a peaceful and undisputed manner or that he purchased it from the original owner, legal beneficiary, title transferee or heir of the real property. Since the Land Law came into effect in 2001, Cambodia no longer recognizes the acquisition of ownership by prescription. A new occupant of real property belonging to a public institution or a private person without proof of ownership will be considered an illegal occupant and punished according to Article 259 of the Land Law.

2. Paid transfer

The paid transfer of private land includes two forms: exchange and sale. The real estate sale contract allows the seller to transfer the ownership of the real estate to the buyer in exchange for the buyer paying the purchase price of the real estate. Cambodian citizens who are able to enter into a contract can sell or buy real estate.

The Crowd may not sell real property as follows:

• Non-property owner
• Co-owner of undivided property without the consent of the other co-owners
• People whose property has been confiscated

A person cannot acquire immovable property as follows:

• The guardian cannot purchase the ward’s property
• The manager shall not purchase the property under his management
• Judges and government officials may not purchase property that they have jurisdiction over or are responsible for selling.
• A person whose property has been foreclosed cannot purchase the property again.
• The sales contract between spouses is invalid.

3. Free donation

Donation refers to the act of transferring the property ownership from the donor to the donee, and the donee accepts it. Only real estate donations that are in written form and in legal format and registered with the registration department have the effect of opposing third parties. Real estate donations can be divided into donations during one's lifetime, donations after death, and donations by entrustment.

The state may grant real estate only to natural persons for social reasons, for their residence or for cultivation for subsistence. The value of the real estate gift must be limited to the above-mentioned purpose, taking into account the social status of the beneficiary, and speculation or improper profit is prohibited.

Once a real estate gift is accepted, it is irrevocable. The title to the gift can be transferred quickly, but the donor can retain the easement, right of use and right of residence of the property, which must be detailed in the contract and registered with the registry.

4. Inheritance

The following real estate can be transferred through inheritance:

• The ownership certificate of the real estate has been established in accordance with this Law
• Legal documents, ownership certificates or other evidence of legal possession
• Any limited property rights and real estate rights

Real estate that has not been registered or documented but is actually occupied in accordance with legal requirements can be transferred through inheritance. For occupied property without proof of ownership, the heir who becomes the new property holder after the inheritance transfer can continue to manage and enjoy protection as long as all other requirements of the Land Law are met.

3. Land sharing

1. Indivisible land ownership

Undivided ownership is the joint ownership of a particular property by several persons with equal shares, who share the rights and protect the common interests, and who bear the management costs and taxes together. The undivided owners have the right to jointly own the undivided ownership, unless there is an agreement to the contrary. Each undivided owner can perform day-to-day management, but important matters require a majority (representing ownership of more than half of the total property) to decide.

No one can force another to retain undivided ownership of the property. The property can only be divided if any of the undivided co-owners requests it at any time. Undivided co-owners can temporarily retain undivided ownership, but not for more than 5 years, unless there is a new agreement otherwise.

2. Joint ownership

Article 175 of the Land Law provides that "Joint ownership refers to the ownership of real estate belonging to more than one person, each of whom owns a part of it, and the rest is common property." Joint owners can manage it in accordance with the maintenance regulations, management procedures and obligations of joint owners specified in this law, especially the internal regulations for the common parts.

The co-owners have full rights over their portion, provided that they do not infringe upon the common portion and do not hinder the use of the common portion by the other co-owners. The co-owners are free to rent out, create easements, establish residence rights, mortgage or use their portion in common. However, they may not establish a priority right over their portion. A portion of a building or land that is allocated to all co-owners or to specific co-owners for their use so that they can all benefit shall be considered a common portion.

Common property includes the following:

• Ground, parking lot, courtyard, garden and passage, etc.
• Structural maintenance of walls and buildings, shared facilities such as water, electricity and gas pipelines, etc.
• chimney
• Shared service area

The following accessory rights are considered common property:

• The right to dig up what is already in the ground.
• The right to construct yards, parking areas, or gardens on the common parts.
• Rights relating to joint ownership of common parts.
• The right to build on top of a part of a building used in common. The owner of the top floor of a common building cannot build an apartment for himself or sell the right.

All of the above are rights that are in line with public order.

Any co-owner who privately uses or sells the jointly owned part is obliged to restore the original condition. Violators are punished under Article 257 of the Land Law. A person who is not a co-owner and occupies the common part shall return the occupied place and restore it to its original condition. Regardless of the circumstances, the competent authority shall not issue a certificate recognizing the rights of such a person. If issued, the competent authority is obliged to ensure that the illegal occupation is suppressed.

3. Joint ownership

Article 186 of the Land Law states: "Co-ownership is a form of joint ownership that applies to a wall that divides two adjacent titles. Under the law, walls include ditches, fences and embankments."

(1) Commonly owned walls

Repair and reconstruction of the common wall is a joint responsibility of the co-owners. If a co-owner abandons his co-ownership rights and is not responsible for the above repairs or reconstruction, unless the common wall supports his building. A co-owner of a common wall may not dig a pit or carry out any work that damages the common wall without the consent of the other co-owners. If a unanimous opinion cannot be reached, an arbitrator may be appointed as an expert to decide the necessary methods to ensure that other new works do not infringe the interests of the other co-owners. Each co-owner may build on the common wall and may place beams and railings at least 5 cm from the other side so as not to affect the interests of the other co-owners.

(2) Commonly owned canals, walls and dams

No owner of adjacent land may compel the owner of a common wall or embankment to own the ditch, wall or embankment jointly with them.

Land permit system

1. Classification of land permits

Cambodia's land licensing system is that the government grants citizens, legal persons and other social organizations the right to use state land for a specific period of time through administrative concessions, allowing them to use the land in the form of ownership. This land system is detailed in Chapter 5 of the Land Law. According to Articles 49 and 50 of the Land Law, Cambodia's concession land can be divided into three categories: social concession, economic concession and development concession. The Social Concession Land Decree No. 19 and the Economic Concession Land Decree No. 146 respectively make specific provisions for the social concession land and economic concession land systems.

According to the Cambodian Land Law, some restrictions are set on the acquisition of economic concession land. The law stipulates that the area of economic concession land owned by the same legal entity shall not exceed 10,000 hectares, and if it exceeds this limit, it needs to be reduced unless a special exemption is obtained. In addition, the law prohibits the issuance of land ownership certificates exceeding 10,000 hectares to specific individuals or multiple legal entities controlled by them. In addition, the maximum term of use of economic concession land is 99 years. Only the Ministry of Forestry, the Ministry of Agriculture and the Ministry of Fisheries authorized by the Cambodian government have the right to issue administrative licenses to allow private use of economic concession land. These restrictions and regulations are of great significance in protecting the rationality and fairness of land use.

II. Rights and Responsibilities of Stakeholders

1. Rights of the economic concession land interest holder

The economic concession system in the Land Law is stipulated in the "Real Estate Ownership" section. In fact, the economic concession is only a restricted property right, not a real land ownership. Although the right holder of the economic concession can exercise land rights similar to those of the land owner, this right is subject to two important restrictions: the term of use must be approved by the state and is not a permanent right; and it is prohibited to transfer between private individuals and can only be reclaimed by the government and re-licensed to others for use. The purpose of these restrictions is to ensure the sustainability of land use and the public interest. Therefore, the economic concession system provides a limited but specific purpose of land use rights to promote economic development and protect the country's land resources.

2. Obligations of the economic concession land right holder:

1. Agricultural development shall be carried out in accordance with the purpose of the license. The right holder shall not change the use of the land without authorization, destroy the natural structure, or carry out destructive development at the end of the license period. — Article 56, Paragraph 3 of the Land Law
2. The obligation to pay the license fee. If this obligation is not fulfilled, the government has the right to revoke the license and the licensee has no right to claim the resulting losses. — Article 62, paragraph 2 of the Land Law

3. Administrative licensing conditions for economic concessions:

According to Sub-Regulation No. 146, the granting of economic concessions must meet the following five conditions:

• Land ownership: The land must be classified and registered by the state and confirmed as state private land.
• Land use plan: The land use plan must be submitted to the local government's land management department and approved.
• Environmental and Social Impact Assessment: An environmental and social impact assessment is required to evaluate the impact of the project on the environment and society.
• Resettlement: The issue of resettlement of people must be addressed and involuntary resettlement must not be allowed.
• Stakeholder considerations: The opinions of stakeholders, such as local residents and land management departments, must be fully considered.

4. New policy on economic concession land

Economic concession land is a land system that is closely related to the Cambodian government’s economic and land policies and is greatly influenced by government policies.

Land lease system

Article 106 of the Land Law provides that: "The owner of real estate may lease it to others. A lease contract is a contract in which the owner of real estate temporarily transfers the property to another person in exchange for a specified rent and lease period. A real estate lease contract is also called a lease agreement." According to Article 109 of the law, a lease contract should be concluded in writing; at the same time, the law also recognizes that a written contract concluded orally is valid, but it is regarded as an indefinite lease and can be terminated at any time as long as notice is given before the rent payment period.

According to Article 108 of the Land Law, leases can be divided into two forms: indefinite leases and fixed-term leases. Fixed-term leases include short-term leases with an option to renew and long-term leases of more than 15 years. The leasehold rights formed by long-term leases can be transferred and inherited, and the lessee has the right to make improvements without damaging the nature of the subject matter. After the lease ends, the lessor can fully acquire ownership without paying compensation for the improvements. This provision comes from Article 108 of the Land Law.

Before signing the contract, the lessee is obliged to understand the condition of the real estate. If the real estate is not inspected, it will be deemed that the condition complies with the provisions of the lease agreement, Article 110 of the Land Law. During the renewal period of the lease contract, the lessee is responsible for normal maintenance of the property, unless otherwise agreed in the contract. After the lease period ends, the lessee is obliged to restore the leased property to its original condition and bear the losses caused by improper use, which comes from Article 111 of the Land Law.

Land Guarantee System

1. Mortgage

Article 198 of the Land Law provides that: "Mortgage is a form of security and does not transfer the ownership of the real estate. When the debt is due, the creditor has the right to sell the real estate through the court. Regardless of how many times the real estate has been transferred, the creditor has the priority right to payment for the sales price." Only real estate registered with the land registration agency is eligible for mortgage.

The mortgage contract must be drawn up in legal form by the competent authority or an authorized lawyer and must be registered with the competent authority. The drafting guidelines and registration forms of the relevant mortgage contracts shall be drawn up by the institutions prescribed by law. The mortgage contract must clearly describe the property status, nature, and the cost and value determined in accordance with relevant regulations. Mortgages can be made successively on the same property, and each creditor shall exercise his rights in the order of mortgage registration.

2. Pledge

Article 206 of the Land Law states: "A pledge is a contract whereby the debtor transfers real property to the creditor as a guarantee of payment. The creditor has the right to sell the property and receive compensation in priority to other unsecured creditors. If a pledge contract is established, the creditor may retain the property for interest or principal."

According to the current legal provisions, the pledge contract should be presented in writing, drawn up and registered before the competent authority in accordance with the statutory format. The pledge contract drawn up in the above manner shall be deemed valid and no third party can question its validity. The unregistered pledge contract will cause the creditor to lose the security rights, and the creditor will only have the right to claim compensation in accordance with the current law. The pledged property shall be returned to the debtor after the debtor has paid the debt.

In any case, the creditor cannot become the owner of the property. In a pledge contract, the creditor has the right to ask the court to force the sale of the real estate and to receive priority payment for the value of the property.

During the pledge period, if the creditor of the pledgee purchases the pledged property, the purchase contract must be registered. Failure to register is considered invalid. During the period of possession of the pledged property, the creditor has the responsibility to maintain and protect it. If the pledged property is damaged due to the creditor's actions or negligence, the corresponding losses must be deducted. The debtor is responsible for paying taxes and fees unless otherwise agreed.

Once the debtor has paid off the debt, the creditor cannot take possession of the pledged property because the debtor owes him another debt, unless a new pledge contract is concluded in accordance with the law. The debtor can raise a right of rebuttal against the creditor's heirs or nominees.

3. Pawn

Articles 219 and 220 of the Land Law provide that: "Pawning is a way of guaranteeing a debt. The debtor does not transfer the property ownership, but rather the property ownership certificate registered with the registration agency." A pawn contract should be drawn up in writing and registered with the relevant registration agency.

In any case, the creditor cannot become the actual owner of the property involved in the pawn contract. The pawn contract only authorizes the creditor to obtain priority in the court liquidation to obtain the right to repayment of the real estate, priority over other creditors. After the debtor repays the debt when it is due or not, the creditor shall cancel the registration with the registration agency and return the property ownership to the debtor.

The debtor has the right to manage and use his property, but shall not do anything that may reduce its value. The heirs or designees of the debtor and creditor shall have the same rights and obligations as the debtor and creditor they represent. The heirs or designees of the debtor and the family members of the co-owners of the pawned property shall bear the same rights and obligations as the debtor.

Land registration system

The real estate registration system is divided into two levels: central and local. Before registering, the registration authority must investigate the land owner, land nature, land measurement, land changes, building conditions, ownership changes and other matters to protect the rights and interests of the owner. The registration agency can issue real estate ownership, possession certificates, mortgage certificates and related materials and documents on the nature, natural conditions, legal conditions and infringement of the land based on the registration documents and the real estate registration book. The registration certificate is regarded as an officially confirmed legal document.

Legal liability

1. Forging property rights certificates

Anyone who falsifies a property title certificate and uses it officially, regardless of the method, shall be punished with a prison term of one to five years. Anyone who deceives the registrar in the performance of his duties or the registration agency in registering land shall be fined 500,000 to 3,000,000 riels and may be sentenced to one to six months in prison.

2. Private Relief

Cambodian law strictly prohibits the use of private remedies. In no case should private force be used to protect personal property rights or enforce court decisions and force occupants to vacate. The use of violence against a good-faith occupant of real property, regardless of whether the rights have been established or are disputed, will be subject to a fine of 1,500,000 to 25,000,000 riel and may be sentenced to 6 months to 2 years in prison. In addition, the infringer will be liable for civil losses caused by the violence.

3. Unauthorized Disposal

Anyone who sells another person's real estate or uses another person's real estate as security shall be sentenced to imprisonment for a term of between six months and three years, regardless of whether civil damages are caused.

4. Common Property

A co-owner of indivisible property who violates the common part of the immovable property as provided for in Article 180 of the Land Law shall be fined between 1,500,000 and 9,000,000 riels. If the offender is a repeat offender, the penalty shall be doubled. A co-owner who refuses to fulfill the obligation to maintain the common property or fails to respect the public order as provided for in Article 185 of this Law shall be fined between 500,000 and 3,000,000 riels.

5. Infringement of Public Property

Anyone who violates public property will be fined between 5,000,000 and 50,000,000 riels and may be sentenced to 1 to 5 years in prison. The violator shall immediately release the public property and shall not be entitled to any compensation for any work or improvement to the property.

If you have possessed state property before this law comes into effect and have documents proving that you purchased it from someone else, you can ask the competent authority to take legal measures against the person who illegally sold the state property to compensate for the losses you have suffered. In any case, you will not have the right to continue to possess state property.

VI. Legal prohibitions

Anyone who disregards the prohibitions of laws and regulations and cultivates his land without authorization, or intentionally provides or rents it to a third party for cultivation, shall be fined between 15,000,000 and 45,000,000 riels and imprisoned in accordance with the current laws.