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Home » Law on Providing Foreigners with Ownership Rights in Private Units of Co-Owned Buildings_100524

Law on Providing Foreigners with Ownership Rights in Private Units of Co-Owned Buildings_100524

Published: 2011 Sep 19

Khmer is the only official document
Unofficial Translation by Department of Legislation of MLMUPC
May 24, 2010

LAW
ON

PROVIDING FOREIGNERS WITH OWNERSHIP
RIGHTS
IN PRIVATE UNITS OF CO-OWNED BUILDINGS

Promulgated : May 24, 2010

CHAPTER 1
GENERAL PROVISIONS

Article 1.
This law provides ownership rights in private units and rights to use and
enjoy benefits in the common areas of a co-owned building.
Article 2.
This law aims to:
– determine general principles, rights and obligations of foreigners
who have ownership rights in private units of co-owned buildings
and other rights relating to the common areas, and procedures for
registration of these rights.
– facilitate foreigners’ investing in the Kingdom of Cambodia.
– facilitate investors’ businesses in the field of construction as well
as respond to the expansion of the land market in the Kingdom of
Cambodia.
Article 3.
This law applies to foreigners and Khmer citizens who have ownership of
private units in co-owned buildings in the Kingdom of Cambodia.
Article 4.
The key terms used with specific meaning under this law have the following
definitions:
Foreigners refers to foreign natural or legal persons having no Khmer
nationality, without any discrimination regarding nationality, belief, religion
or origin.
Legally qualified foreigners refers to foreign nationals who enjoy legal
capacity according to Cambodian laws and who have legally entered
Cambodia.
Co-owned building refers to a building or construction in which several
owners reside. A co-owned building consists of some parts which are the
exclusive ownership of each co-owner, called ‘private units’, and some other
parts which are common spaces for common use of the co-owners, called
‘common areas’.
Private units refers to the parts of the co-owned buildings which are privately
and exclusively occupied and used.
Co-owners of private units refers to persons who have ownership rights in private units.

Common areas refers to all parts of the co-owned building which are
subject to the use or benefit of all co-owners such as the ground, the
courtyard, the stairs, the roof, parks and gardens, access ways, joint walls,
and areas for common service.
Special co-ownership refers to the rights of several persons, who are
foreigners and Khmer citizens, in a co-owned building in which they have
ownership rights in private units and special undivided ownership rights
over common areas of the co-owned building.
Special co-owners refers to foreigners who enjoy special co-ownership
rights.
Special undivided ownership refers to the rights of several persons over
common areas of the co-owned building in which foreigners have the right
to use and enjoy benefits of the common areas, and Khmer citizens have
undivided ownership rights over the common areas, as they all enjoy
ownership of private units.
Lot refers to a private unit that is attached to the common areas of a co-
owned building. Each lot has a different value according to whether the
private unit is large or small; a calculation of value shall be made
according to each co-owner’s private unit’s surface.

CHAPTER 2
GENERAL PRINCIPLES

Article 5.
Legally qualified foreigners have ownership rights in private units of co-
owned buildings and rights to use and enjoy benefits of the common areas, and
they have obligations to comply with the provisions of this law and other related
regulations in force.
Article 6.
Foreigners have ownership rights in private units of co-owned buildings
only from the first (1st
) floor up. The ground floors and underground floors cannot
be owned by foreigners.
A Sub-decree shall determine the proportion and percentage of private
units that can be owned by foreigners in a co-owned building..
“Lot” as used here is a French word that means in this context exactly what is written here.  Its use in this law is
derived from 2001 Land Law articles 175, 181 and 184 on co-ownership.  “Lot” as used here should not be confused
with the English word “lot” which, when speaking of land, generally means “parcel of land”.

This ownership right only provides private units of co-owned buildings for
foreigners. As far as the common areas of co-owned buildings are concerned,
they shall be kept for the common use of all co-owners of the co-owned
buildings.
In any case, the land parcel where the co-owned building is located
cannot be subject to the ownership of special co-owners.
Foreigners are not authorized to acquire ownership rights in private units
of co-owned buildings located within 30 (thirty) kilometers of the land borders of
Cambodia and in other areas determined by the Royal Government, except for
the co-owned buildings located in Special Economic Zones, in important urban
areas and in other areas determined by the Royal Government.
In case the co-owned buildings are constructed on land leased from a
third party, foreigners enjoy perpetual lease rights in private units similar to how
Khmer citizens do.

CHAPTER 3
ACQUISITION OF SPECIAL CO-OWNERSHIP

Article 7.
The creation, transfer and modification of special co-ownership can be
done as follows:
– Through agreement among parties in accordance with the laws and
regulations in force;
– Through succession.
Article 8.
A transfer of special co-ownership by agreement shall not be effective
unless it has been registered in accordance with the legal provisions and
regulations regarding registration.
Article 9.
When a Cambodian co-owner of a private unit has transferred ownership
of a private unit to a foreigner, the special co-owner shall acquire an ownership
right to the private unit and only the right to use and enjoy the common areas. In
this case, the former Cambodian co-owner of the private unit shall lose his/her
undivided ownership of the common areas.
In case the co-owner of the private unit is a foreigner and has transferred
the private unit to a Cambodian, the Cambodian co-owner shall acquire an
ownership right in the private unit and undivided ownership of the common areas.
Article 10:
Successors of special co-owners shall receive the rights and obligations of
the deceased in accordance with the laws and regulations in effect.
In case the inheritance is unoccupied because there is no successor or
the successor abandons it, or if the inheritance is not designated to any person in
accordance with the legal provisions, such inheritance shall become the property
of the State.
Article 11:
In the event that, after this law becomes effective, any foreigner receives
the transfer of or purchases any private unit of a co-owned building in violation of
Article 6 of this law, the transaction shall be null and void and the parties to the
transaction shall make a restitution.

CHAPTER 4
RIGHTS AND OBLIGATIONS OF SPECIAL CO-OWNERS

Part 1.
Rights and obligations of special co-owners
concerning private units

Article 12
Special co-owners of private units shall have the right to freely use, enjoy,
and dispose of the ownership of their private units to the extent determined by
law.
Article 13.
Special co-owners of private units cannot use their private units to hurt,
infringe, or hinder the use, or to disturb the livelihood, of the other co-owners of
private units.
Special co-owners of private units shall not take any action that could
harm the maintenance of the co-owned building or take any other action against
the common interests of the co-owners of private units in relation to the
management or use of the co-owned building.
Article 14.
Special co-owners of private units of co-owned buildings shall have the
same obligations and burdens as Cambodian co-owners. Special co-owners
shall comply with all obligations and/or burdens stipulated in the internal rules of
the co-owned building and/or the laws in effect.

Part 2.
Rights and obligations of special co-owners
concerning common areas

Article 15.
Common areas shall be under the regime of special undivided ownership
of all co-owners of private units.
Special co-owners shall have only the right to use and enjoy the common
areas.
Article 16.
Special undivided ownership and other marginal rights recognized by law
shall not be subject to division, disposal, and forced sale separate from the
private unit.
Article 17.
Special co-owners shall participate in the maintenance of the common
areas. The burdens of such maintenance shall be divided in proportion to the
value of each lot except as otherwise agreed to or as stipulated to the contrary by
the internal rules.
Article 18.
The right to use and enjoy the common areas, including the land on which
the co-owned building is situated or the land developed as courtyard that has
been determined as a common area, shall not cease although the building or the
private unit ceases to exist.
In the event that a co-owned building becomes dilapidated, impossible to
reside in, or destroyed in any way including by a forced measure by the
competent authorities to dismantle it for the safety of the residents, all co-owners
may agree on repairing or reconstructing by taking charge of the expenses
according to the proportion of the value of each lot or according to a previously-
made agreement or the internal rules. The repair or reconstruction shall be
undertaken in compliance with the effective legal procedures regarding
construction permits and shall maintain the original structure of the building
unless there is an agreement to the contrary or provided otherwise by the internal
rules of the co-owned building.
In the event that a co-owned building gets totally destroyed by a human
act or by force majeure and the Cambodian co-owners agree to sell the land on
which the co-owned building is situated, special co-owners shall be entitled to
receive sale proceeds based on their right to use and enjoy the common areas
according to the proportion of the surface area of their private units or according
to a previously-made agreement or the internal rules.

CHAPTER 5
PROCEDURE FOR REGISTRATION AND ISSUANCE OF CERTIFICATE

Article 19.
The legal provisions and other regulations relevant to procedural
mechanisms of registration and issuance of certificates shall likewise apply to the
procedure for registration and issuance of certificates for special co-ownership of
co-owned buildings.
A sample of the certificate of ownership of a private unit of a special co-
owner, with wording regarding rights, shall be determined by Prakas of the
Minister of Land Management, Urban Planning, and Construction.

CHAPTER 6
PENALTIES

Article 20.
Special co-owners who infringe on the common areas of a building or the
land by altering it for private use or for sale shall be forced to make restitution.
Such co-owners shall be penalized as stated in Article 257 of the Land Law.
Special co-owners who refuse to participate in taking charge of the
maintenance of the common areas or fail to comply with the requirements of
public order shall be penalized as stated in Article 258 of the Land Law.
Article 21.
A violation committed by the cadastral authority against the provisions of
this law concerning registration or issuance to a special co-owner of a certificate
of ownership of a private unit of a co-owned building, shall be penalized as stated
in Article 264 of the Land Law.

CHAPTER 7
TRANSITIONAL PROVISIONS

Article 22.
Any foreigner who purchased or received the transfer of a private unit of a
co-owned building before this law came into effect and in conflict with the
provisions of Article 6 of this law, shall be allowed to rectify himself and obey this
law within a period of 2 (two) years.
In case of failure to comply with the first paragraph, the competent
authority shall file a complaint to the competent court in order to force-sell the
private unit of the co-owned building.

CHAPTER 8
FINAL PROVISIONS

Article 23.
Any provisions that are contrary to this law shall be null and void.
Article 24.
This law shall be declared urgent.

Royal Palace, Phnom Penh, May 24,
2010
(royal signature and seal)
NORODOM SIHAMONI

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