Gov’t Strengthens Real Estate Regulations to Boost Investor Confidence

• Sommana Yan
• 30 June 2023
• Local News
• 2936 Views

In a significant move to enhance transparency, efficiency, and investor trust in the real estate sector, the Government of Cambodia has recently issued a comprehensive sub-decree aimed at managing and controlling the real estate development business. Sub-Decree No. 50, dated 2 March 2023, outlines measures to ensure fairness, attract investment, and foster a thriving real estate market.

The sub-decree defines the real estate development business as encompassing various commercial and investment activities involving the construction of residential properties, co-ownership buildings, and the development of plots for sale or rent.

To oversee and regulate the real estate development business, the Real Estate and Mortgage Regulatory Authority (NTPC) of the Non-Banking Financial Services Authority has been entrusted with the responsibility. The NTPC will act as the licensing authority for real estate developers, ensuring compliance with the established regulations.

The sub-decree introduces specific licensing categories for different types of real estate development, including (1). residential development, (2). co-ownership building development, and (3). land development. Furthermore,  licenses for residential development and co-ownership buildings are further classified into two distinct categories.

Type 1 licenses and business permits are granted to developers who have completed their projects before initiating the sale or lease of properties. Type 2 licenses and business permits are issued to developers who announce the sale or lease of properties during the project’s construction phase.

Developers holding a Type 1 license or business permit may commence sales or leasing activities once their projects have been finalized. Conversely, developers with a Type 2 license or business permit must obtain an additional license from the NTPC before engaging in sales or leasing operations.

By implementing these robust regulations, Cambodia aims to create an environment that promotes fairness, protects the interests of investors and buyers, and further elevates the country’s real estate market. This significant step by the government is set to bolster investor confidence, attract more investments, and contribute to the sustainable growth of the real estate sector in Cambodia.

• Laws and Regulation