Cambodia: Kingdom’s Investment Law example of ‘simplified approval mechanism’
Cambodia’s Investment Law provides an example of the development and implementation of a simplified approval mechanism, involving automatic approvals which render timelines for approval unnecessary, a report on the investment facilitation for sustainable development within the context of the RCEP, the ASEAN investment facilitation framework and the WTO draft investment facilitation framework for development said.
While analyzing the landscape of investment facilitation initiatives in ASEAN and RCEP countries, the study – conducted by ESCAP – pointed out that under Cambodia’s Investment Law, the registration process has been simplified by the adoption of an automatic approval system where the investment project is approved by default unless the contemplated activity is in the negative list of activities.
While evaluating the project registration provisions in Cambodia, it said, “The effort to improve efficiency through the possibility of sanctions against delinquent government officials is replaced by the adoption of an automatic approval system. The process thus no longer relies upon timely action by individual officials.”
It also pointed out that “the 2021 law establishes a new post-registration compliance check by Cambodia’s IPA, balancing the automaticity of project approvals.”
The report said the websites that provide substantial information regarding investment incentives belong to Cambodia and Thailand.
Cambodia under its new 2021 Investment Law, has adopted a new regime of incentives for investors with the potential to contribute to national economic development, including projects that contribute to skills training (especially for SMEs), or to the development of the infrastructure, environmental protection and biodiversity conservation), it noted.
Details of this new regime are available on CDC’s website.