The Ministry of Land Management has revealed details of a long-awaited draft law that would allow foreigners to own apartments and condominiums, but not land, in Cambodia, Land Management Minister Im Chhun Lim said Thursday.
According to the draft law presented to the government-private sector working group on Law, Tax and Good Governance, foreigners would not be allowed to own ground-floor space or apartments that are close to the border, the minister said in an interview.
“The ministry wants to finish [the draft law] soon according to consensus,” the minister said, adding that he will solicit recommendations on the draft at a later date.
Currently foreigners can only sign leases of up to 99 years in Cambodia. Unlike many Asian countries, Cambodia has no law allowing real estate ownership by foreigners. Foreign land ownership is widely banned in Asia and forbidden by the Cambodian Constitution.
The draft law, if passed, would mean that units purchased by foreigners “are their property forever,” Mr Im Chhun Lim said. “They can sell, rent, pawn and leave to their children.”
The law could help unload the thousands of high-end apartments being constructed that many developers say there is limited domestic demand for.
Working group co-chair Bretton Sciaroni said that the government is moving quickly on the draft, and that he wasn’t aware of any surprises in the proposed law.
The law is a step forward that would encourage foreign investment in the country, he said.
“I think a lot of foreigners would be interested in owning their own condos here,” he said. “It will help inject some life into the real estate industry, which has been flat since last fall.”
Mr Sciaroni described the process of passing the law as a two-step one. First the Council of Ministers must pass a sub-decree allowing Cambodians to own condominiums and apartments on a national land title basis. The draft law on foreign ownership of condominiums would then have to be moved through the Council of Ministers and the National Assembly, which could happen this year, he said.
Sung Bonna, director of Bonna Realty and the National Valuers Association of Cambodia, said the law is a good one overall. “It looks okay. It’s not perfect, but it’s OK. It can be helpful for foreigners,” he said.
The possible limit of two units per foreign owner and the proposed restriction on owning units near the border are not “perfect” additions, but are acceptable, he said. “It’s fair enough. It’s better than nothing,” he said.
Mr Im Chhun Lim said the limit on owning units near the border is up for discussion.
“We could discuss where national security would require the government to restrict ownership,” he said.