T HE long-awaited investment law will permit the repatriation of money by foreign
investors and hold down their taxes, according to a draft of the legislation
obtained by Reuters on May 2.
The law provides for the unrestricted
transfer of foreign currencies abroad by both foreigners and Cambodians, the
draft says.
Finance Minister Sam Rainsy told a journalist last week that
he hoped the bill would be ready for passage by the National Assembly next
month.
"The Kingdom shall permit Cambodian and foreign nationals with
investments in Cambodia to purchase foreign currencies through the banking
system and to pay freely abroad those currencies for the discharge of
obligations incurred in connection with their investments," Article 8 of the
draft says.
Other investment guarantees concern land ownership,
nationalization, taxation rates and import duties.
Article 5 of the draft
says Cambodia will tax business profits at a rate of 20
percent.
Exemption of profit tax in whole or part may be offered to
companies that increase non-traditional exports or increase the value added to
products in Cambodia.
More than 50 percent of all real-estate holdings
would have to be in the hands of Cambodians, but foreigners would be able to
take leases of up to 30 years.
An umbrella body to be called the
Cambodian Development Council (CDC) would shoulder responsibility for
administering the investment law.
The CDC would be made up of senior
officials from three key ministries, planning, finance and public works, Rainsy
has said.
"The CDC will be presided over by our first prime minister
[Prince Norodom Ranariddh] so it is very powerful," he said.
Cambodia,
battered by more than two decades of civil war and social upheaval, has set
luring foreign investment as a priority in the country's economic
rehabilitation. Many potential investors have held off until seeing how the law
takes shape.
-Reuters
