Doing Business 2018 Cambodia Economy Pro le of Cambodia Doing Business 2018 Indicators (in order of appearance in the document) Starting a business Procedures, time, cost and paid-in minimum capital to start a limited liability company Dealing with construction Procedures, time and cost to complete all formalities to build a warehouse and the quality control and permits safety mechanisms in the construction permitting system Getting electricity Procedures, time and cost to get connected to the electrical grid, the reliability of the electricity supply and the transparency of tariffs Registering property Procedures, time and cost to transfer a property and the quality of the land administration system Getting credit Movable collateral laws and credit information systems Protecting minority investors Minority shareholders’ rights in related-party transactions and in corporate governance Paying taxes Payments, time and total tax rate for a firm to comply with all tax regulations as well as post-filing processes Trading across borders Time and cost to export the product of comparative advantage and import auto parts Enforcing contracts Time and cost to resolve a commercial dispute and the quality of judicial processes Resolving insolvency Time, cost, outcome and recovery rate for a commercial insolvency and the strength of the legal framework for insolvency Labor market regulation Flexibility in employment regulation and aspects of job quality About Doing Business The Doing Business project provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and regional level. The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle. Doing Business captures several important dimensions of the regulatory environment as it applies to local rms. It provides quantitative indicators on regulation for starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Doing Business also measures features of labor market regulation. Although Doing Business does not present rankings of economies on the labor market regulation indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business, it does present the data for these indicators. By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more e cient regulation; o ers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy. In addition, Doing Business o ers detailed subnational reports, which exhaustively cover business regulation and reform in di erent cities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 190 economies that Doing Business has ranked. The rst Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This year’s report covers 11 indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the second largest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. The project has bene ted from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the regulatory environment for business around the world. Page 2   for insolvency Doing Business Labor market 2018 regulation Cambodia Flexibility in employment regulation and aspects of job quality About Doing Business The Doing Business project provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and regional level. The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle. Doing Business captures several important dimensions of the regulatory environment as it applies to local rms. It provides quantitative indicators on regulation for starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Doing Business also measures features of labor market regulation. Although Doing Business does not present rankings of economies on the labor market regulation indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business, it does present the data for these indicators. By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more e cient regulation; o ers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy. In addition, Doing Business o ers detailed subnational reports, which exhaustively cover business regulation and reform in di erent cities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 190 economies that Doing Business has ranked. The rst Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This year’s report covers 11 indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the second largest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. The project has bene ted from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the regulatory environment for business around the world. The distance to frontier (DTF) measure shows the distance of each economy to the “frontier,” which represents the best performance observed on each of the indicators across all economies in the Doing Business sample since 2005. An economy’s distance to frontier is re ected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents the frontier. The ease of doing business ranking ranges from 1 to 190. The ranking of 190 economies is determined by sorting the aggregate distance to frontier scores, rounded to two decimals. More about Doing Business (PDF, 5MB) Ease of Doing Business in Region East Asia & Pacific DB 2018 Rank 190 1 Cambodia Income Category Lower middle income 135 Population 15,762,370 DB 2018 Distance to Frontier (DTF) GNI Per Capita (US$) 1,140 0 100 54.47 City Covered Phnom Penh DB 2018 Distance to Frontier (DTF) 0 100 78.43: Malaysia (Rank: 24) 66.47: Indonesia (Rank: 72) 62.70: Regional Average (East Asia & Pacific) 58.74: Philippines (Rank: 113) 54.47: Cambodia (Rank: 135) Page 3   53.01: Lao PDR (Rank: 141) aggregate distance to frontier scores, rounded to two decimals. More Doingabout 2018 (PDF, Doing Business Business 5MB) Cambodia Ease of Doing Business in Region East Asia & Pacific DB 2018 Rank 190 1 Cambodia Income Category Lower middle income 135 Population 15,762,370 DB 2018 Distance to Frontier (DTF) GNI Per Capita (US$) 1,140 0 100 54.47 City Covered Phnom Penh DB 2018 Distance to Frontier (DTF) 0 100 78.43: Malaysia (Rank: 24) 66.47: Indonesia (Rank: 72) 62.70: Regional Average (East Asia & Pacific) 58.74: Philippines (Rank: 113) 54.47: Cambodia (Rank: 135) 53.01: Lao PDR (Rank: 141) Note: The distance to frontier (DTF) measure shows the distance of each economy to the “frontier,” which represents the best performance observed on each of the indicators across all economies in the Doing Business sample since 2005. An economy’s distance to frontier is re ected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents the frontier. The ease of doing business ranking ranges from 1 to 190. Rankings on Doing Business topics - Cambodia 1 20 28 55 74 82 Rank 108 108 109 123 137 136 136 163 183 179 179 190 Starting Dealing Getting Registering Getting Protecting Paying Trading Enforcing Resolving a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Investors Borders Permits Distance to Frontier (DTF) on Doing Business topics - Cambodia 100 80.00 80 67.28 61.28 60 56.56 55.00 DTF 51.91 50.00 48.25 41.73 40 32.67 20 0 Starting Dealing Getting Registering Getting Protecting Paying Trading Enforcing Resolving a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Change:+0.56 Change:+0.04 Change:0.00 Investors Change:0.00 Borders Change:0.00 Change:+0.15 Change:+1.00 Permits Change:0.00 Change:0.00 Change:+0.59 Starting a Business Page 4   This topic measures the paid-in minimum capital requirement, number of procedures, time and cost for a small- to medium-sized a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Change:+0.56 Change:+0.04 Change:0.00 Investors Change:0.00 Borders Change:0.00 Change:+0.15 Change:+1.00 Permits Change:0.00 Change:0.00 Doing Business 2018 Cambodia Change:+0.59 Starting a Business This topic measures the paid-in minimum capital requirement, number of procedures, time and cost for a small- to medium-sized limited liability company to start up and formally operate in economy’s largest business city. To make the data comparable across 190 economies, Doing Business uses a standardized business that is 100% domestically owned, has start-up capital equivalent to 10 times income per capita, engages in general industrial or commercial activities and employs between 10 and 50 people one month after the commencement of operations, all of whom are domestic nationals. Starting a Business considers two types of local limited liability companies that are identical in all aspects, except that one company is owned by 5 married women and the other by 5 married men. The distance to frontier score for each indicator is the average of the scores obtained for each of the component indicators. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to legally start and operate a To make the data comparable across economies, several assumptions company (number) about the business and the procedures are used. It is assumed that any required information is readily available and that the entrepreneur will pay Pre-registration (for example, name verification no bribes. or reservation, notarization) Registration in economy’s largest business city The business: - Is a limited liability company (or its legal equivalent). If there is more than Post-registration (for example, social security one type of limited liability company in the economy, the most common registration, company seal) among domestic rms is chosen. Information on the most common form is Obtaining approval from spouse to start business obtained from incorporation lawyers or the statistical o ce. or leave home to register company - Operates in the economy’s largest business city and the entire o ce Obtaining any gender-specific permission that space is approximately 929 square meters (10,000 square feet). For 11 can impact company registration, company economies the data are also collected for the second largest business city. operations and process of getting national - Is 100% domestically owned and has ve owners, none of whom is a legal identity card entity; and has a start-up capital of 10 times income per capita and has a Time required to complete each procedure turnover of at least 100 times income per capita. (calendar days) - Performs general industrial or commercial activities, such as the production or sale of goods or services to the public. The business does Does not include time spent gathering not perform foreign trade activities and does not handle products subject information to a special tax regime, for example, liquor or tobacco. It does not use Each procedure starts on a separate day (2 heavily polluting production processes. procedures cannot start on the same day) - Leases the commercial plant or o ces and is not a proprietor of real Procedures fully completed online are recorded estate and the amount of the annual lease for the o ce space is equivalent as ½ day to 1 times income per capita. Procedure is considered completed once final - Does not qualify for investment incentives or any special bene ts. document is received - Has at least 10 and up to 50 employees one month after the commencement of operations, all of whom are domestic nationals. No prior contact with officials - Has a company deed 10 pages long. Cost required to complete each procedure (% of The owners: income per capita) - Have reached the legal age of majority. If there is no legal age of majority, Official costs only, no bribes they are assumed to be 30 years old. No professional fees unless services required by - Are sane, competent, in good health and have no criminal record. law or commonly used in practice - Are married and the marriage is monogamous and registered with the authorities. Paid-in minimum capital (% of income per capita) - Where the answer di ers according to the legal system applicable to the Funds deposited in a bank or with third party woman or man in question (as may be the case in economies where there before registration or up to 3 months after is legal plurality), the answer used will be the one that applies to the incorporation majority of the population. Standardized Company Page 5   before registration or up to 3 months after is legal plurality), the answer used will be the one that applies to the incorporation majority of the population. Doing Business 2018 Cambodia Standardized Company Legal form Private Limited Liability Company Paid-in minimum capital requirement KHR 4,000,000 City Covered Phnom Penh East Asia & OECD high Indicator Cambodia Pacific income Overall Best Performer Procedure – Men (number) 9 7.0 4.9 1.00 (New Zealand) Time – Men (days) 99 22.7 8.5 0.50 (New Zealand) Cost – Men (% of income per capita) 51.3 18.4 3.1 0.00 (United Kingdom) Procedure – Women (number) 9 7.0 4.9 1.00 (New Zealand) Time – Women (days) 99 22.8 8.5 0.50 (New Zealand) Cost – Women (% of income per capita) 51.3 18.4 3.1 0.00 (United Kingdom) Paid-in min. capital (% of income per capita) 82.5 15.1 8.7 0.00 (113 Economies) Figure – Starting a Business in Cambodia and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 83.78: Malaysia (Rank: 111) 82.32: Regional Average (East Asia & Pacific) 77.93: Indonesia (Rank: 144) 72.56: Lao PDR (Rank: 164) 68.88: Philippines (Rank: 173) 51.91: Cambodia (Rank: 183) Note: The ranking of economies on the ease of starting a business is determined by sorting their distance to frontier scores for starting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Starting a Business in Cambodia – Procedure, Time and Cost Time Cost 40 35 80 ost (% of income per capita) 30 60 25 Time (days) 20 40 15 Page 6   10 starting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Cambodia Figure – Starting a Business in Cambodia – Procedure, Time and Cost Time Cost 40 35 80 Cost (% of income per capita) 30 60 25 Time (days) 20 40 15 10 20 5 0 0 1 2 3 4 5 6 *7 *8 *9 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Details – Starting a Business in Cambodia – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Conduct an initial check for uniqueness of the company name and 1 week KHR 40,000 Obtain company name approval at the Business Registration Department Agency : Business Registration Department, Ministry of Commerce The Ministry of Commerce issued a Prakas No. 299 on 29 December 2015 to implement a new procedure for registration of company through the online system. Website: www.businessregistration.moc.gov.kh The company is required to set up an account on business registration website of Ministry of Commerce, so they can perform the name search availability and reserve the name online by uploading the ID Cards or Passports of Owners. The payment of government fee shall be done online as well through certain commercial bank including ACLEDA bank, Foreign Trade Bank. 2 Incorporate the company with the Business Registration Department in 1 month KHR 1,680,000 Ministry of Commerce Agency : Business Registration Department, Ministry of Commerce Under the new Prakas 299 of December 2015. Every businessman and trade company based in the Kingdom of Cambodia is obligated to register their business through the Ministry of Commerce’s automated business registration system from anywhere via this Website: www.businessregistration.moc.gov.kh Page 7   (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Doing Business 2018 Cambodia Details – Starting a Business in Cambodia – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Conduct an initial check for uniqueness of the company name and 1 week KHR 40,000 Obtain company name approval at the Business Registration Department Agency : Business Registration Department, Ministry of Commerce The Ministry of Commerce issued a Prakas No. 299 on 29 December 2015 to implement a new procedure for registration of company through the online system. Website: www.businessregistration.moc.gov.kh The company is required to set up an account on business registration website of Ministry of Commerce, so they can perform the name search availability and reserve the name online by uploading the ID Cards or Passports of Owners. The payment of government fee shall be done online as well through certain commercial bank including ACLEDA bank, Foreign Trade Bank. 2 Incorporate the company with the Business Registration Department in 1 month KHR 1,680,000 Ministry of Commerce Agency : Business Registration Department, Ministry of Commerce Under the new Prakas 299 of December 2015. Every businessman and trade company based in the Kingdom of Cambodia is obligated to register their business through the Ministry of Commerce’s automated business registration system from anywhere via this Website: www.businessregistration.moc.gov.kh The following documents must be provided online to the Ministry’s Registrar in the speci ed quantity: 1. Documents containing address, which can be electricity bill, water bill, house or building rent agreement, bank statement, etc. 2. Agreement establishing the company 3. Photos 4x6 4. Identity card or passport of the company’s owners and administrator 5. Honest declaration by the administrator to have no previous conviction in any commercial, civic or criminal case, and that he/she is currently not a civil servant bound by the Statutes of Civil Servants of the Kingdom of Cambodia 6. In the case where the company’s owners are legal persons: - a certi ed copy of the original legal documents proving the company’s registration - the original copy of letter appointing the legal person as the representative issued by the owners of the company Page 8   The payment of government fee shall be done online as well through certain Business bank Doing commercial 2018including ACLEDA bank, Foreign Trade Bank. Cambodia 2 Incorporate the company with the Business Registration Department in 1 month KHR 1,680,000 Ministry of Commerce Agency : Business Registration Department, Ministry of Commerce Under the new Prakas 299 of December 2015. Every businessman and trade company based in the Kingdom of Cambodia is obligated to register their business through the Ministry of Commerce’s automated business registration system from anywhere via this Website: www.businessregistration.moc.gov.kh The following documents must be provided online to the Ministry’s Registrar in the speci ed quantity: 1. Documents containing address, which can be electricity bill, water bill, house or building rent agreement, bank statement, etc. 2. Agreement establishing the company 3. Photos 4x6 4. Identity card or passport of the company’s owners and administrator 5. Honest declaration by the administrator to have no previous conviction in any commercial, civic or criminal case, and that he/she is currently not a civil servant bound by the Statutes of Civil Servants of the Kingdom of Cambodia 6. In the case where the company’s owners are legal persons: - a certi ed copy of the original legal documents proving the company’s registration - the original copy of letter appointing the legal person as the representative issued by the owners of the company 7. The company must provide two (02) copies of the original version of its statute, accompanied by a statement of bank deposit, to the Department of Business Registration within 30 days starting from the date a business registration certi cate is issued. During this period, if the Department of Business Registration does not receive the original copy of the statute from the applicant, Ministry of Commerce reserves its right to reject the company’s registration and delete it altogether from its database. Documents listed under items (1)-(6) are submitted online at http://www.businessregistration.moc.gov.kh. Documents listed under item (7) are submitted in person in original hard copy. 3 Make a company seal 1 day USD 15 Agency : Sealmaker The Ministry of Commerce registers and acknowledges the seal of the company. The company itself must produce a seal in accordance with formats provided in the MOC. 4 Open a bank account, deposit the legally required initial capital and 1 day no charge Page 9   Doing Business 2018 Cambodia 3 Make a company seal 1 day USD 15 Agency : Sealmaker The Ministry of Commerce registers and acknowledges the seal of the company. The company itself must produce a seal in accordance with formats provided in the MOC. 4 Open a bank account, deposit the legally required initial capital and 1 day no charge obtain deposit evidence Agency : Bank The company must open a bank account in its name. It must also deposit the initial capital 30 days after having obtained the certi cate of incorporation at any authorized bank in Cambodia. The bank must provide a bank statement certifying the deposit. 5 Have registration documents stamped and approved, register for TIN, 1 month USD 100 Patent tax and VAT tax Agency : General Tax Department The documents need to be stamped are the Memorandum and Articles of Association and the Certi cate of Incorporation. This is obtained at one of the tax department branch o ces at the khan (district) level, of which there are 7 in the city. In-person visit to the tax o ce is required in order to take picture and ngerprint. 6 Notify the Ministry of Labor of the start of operations and hiring of 1 month KHR 280,000 (for 8- employees 100 employees) - see Agency : Ministry of Labor procedure details All businesses must submit a written declaration to Ministry of Labor before starting their operations. In addition, each enterprise with at least eight employees must have established internal regulations that adapt such general provisions of the labor code as conditions of hiring and calculation and payment of wages and perquisites, including in-kind bene ts, work hours, health and safety measures, and personal leave, including holidays. The internal regulations must be led within 3 months of rm opening. All establishments must maintain a payroll ledger, a declaration of personnel, a book of establishment, and labor regulations (in Khmer version). As required by law, local employees shall be provided with a “labor book” upon completing a physical examination at the Labor Health Center. The procedure cost covers ve processes: - Registration for opening of enterprise (KHR 30,000) - Registration of enterprise/establishment ledger (KHR 40,000) - Registration of payroll (KHR 60,000) - Having internal regulation certi ed (KHR 70,000) - Issuance of letter recognizing the election of shop steward for enterprise/establishment employing (KHR 80,000) 7 Submit company original statutes and capital deposit evidence at the 1 day no charge Business Registry (simultaneous with Page 10   - Issuance of letter recognizing the election of shop steward for Doing enterprise/establishment Business 2018 Cambodia employing (KHR 80,000) 7 Submit company original statutes and capital deposit evidence at the 1 day no charge Business Registry (simultaneous with Agency : Business Registration Department in Ministry of Commerce previous procedure) The company must provide two copies of the original version of its statute, accompanied by a statement of bank deposit of the chosen capital, to the Department of Business Registration within 30 days starting from the date a business registration certi cate is issued. During this period, if the Department of Business Registration does not receive the original copy of the statute from the applicant, Ministry of Commerce reserves its right to reject the company’s registration and delete it altogether from its database. 8 Receive inspection from Labor Inspector 1 day included in Agency : Ministry of Labor and Vocational Training (simultaneous with procedure 6 previous All new businesses must receive inspection from Labor Inspector at the procedure) Ministry of Labor. 9 Register at the National Social Security Fund 2 weeks no charge Agency : National Social Security Fund (simultaneous with previous Based on the NSSF Law, any enterprise that has eight or more employees is procedure) required to register with the NSSF. At the beginning an employer needs to ll out form 1.01 (Registration of an Enterprise) and 2.01 (Registration of Employees) and le them with NSSF along with supporting documents listed on form 1.01. The two forms can be obtained from any of NSSF o ces. Form 1.01 lists four supporting documents: (1) Certi cate of incorporation of the Company; (2) Patent tax certi cate of the Company; (3) List of employees (form 2.01); (4) Identi cation card or passport of Company's representative. In practice, additional documents might be required, e.g. application form, photo of Company's representative, and location plan of the Company. Upon review and approval, NSSF will issue the Enterprise Registration Certi cate. After registration, the employer must calculate, complete and le the monthly NSSF contribution form with the NSSF. The information required to complete the NSSF contribution form must be completed and led by the required deadline of the 15th of each month. Applies to women only. Takes place simultaneously with previous procedure. Page 11   Dealing with Construction Permits Applies to women only. Takes place simultaneously with previous procedure. Doing Business 2018 Cambodia Dealing with Construction Permits This topic tracks the procedures, time and cost to build a warehouse—including obtaining necessary the licenses and permits, submitting all required noti cations, requesting and receiving all necessary inspections and obtaining utility connections. In addition, the Dealing with Construction Permits indicator measures the building quality control index, evaluating the quality of building regulations, the strength of quality control and safety mechanisms, liability and insurance regimes, and professional certi cation requirements. The most recent round of data collection was completed in June 2017. See the methodology for more information What the indicators measure Case study assumptions Procedures to legally build a warehouse (number) To make the data comparable across economies, several assumptions about the construction company, the warehouse project and the utility Submitting all relevant documents and obtaining connections are used. all necessary clearances, licenses, permits and certificates The construction company (BuildCo): Submitting all required notifications and - Is a limited liability company (or its legal equivalent) and operates in the receiving all necessary inspections economy’s largest business city. For 11 economies the data are also collected for the second largest business city. Obtaining utility connections for water and - Is 100% domestically and privately owned; has ve owners, none of whom sewerage is a legal entity. Has a licensed architect and a licensed engineer, both Registering and selling the warehouse after its registered with the local association of architects or engineers. BuildCo is completion not assumed to have any other employees who are technical or licensed Time required to complete each procedure experts, such as geological or topographical experts. (calendar days) - Owns the land on which the warehouse will be built and will sell the warehouse upon its completion. Does not include time spent gathering information The warehouse: Each procedure starts on a separate day— - Will be used for general storage activities, such as storage of books or though procedures that can be fully completed stationery. online are an exception to this rule - Will have two stories, both above ground, with a total constructed area of Procedure is considered completed once final approximately 1,300.6 square meters (14,000 square feet). Each oor will document is received be 3 meters (9 feet, 10 inches) high and will be located on a land plot of No prior contact with officials approximately 929 square meters (10,000 square feet) that is 100% owned by BuildCo, and the warehouse is valued at 50 times income per capita. Cost required to complete each procedure (% of - Will have complete architectural and technical plans prepared by a warehouse value) licensed architect. If preparation of the plans requires such steps as Official costs only, no bribes obtaining further documentation or getting prior approvals from external agencies, these are counted as procedures. Building quality control index (0-15) - Will take 30 weeks to construct (excluding all delays due to administrative Sum of the scores of six component indices: and regulatory requirements). Quality of building regulations (0-2) The water and sewerage connections: Quality control before construction (0-1) - Will be 150 meters (492 feet) from the existing water source and sewer Quality control during construction (0-3) tap. If there is no water delivery infrastructure in the economy, a borehole Quality control after construction (0-3) will be dug. If there is no sewerage infrastructure, a septic tank in the smallest size available will be installed or built. Liability and insurance regimes (0-2) - Will have an average water use of 662 liters (175 gallons) a day and an Professional certifications (0-4) average wastewater ow of 568 liters (150 gallons) a day. Will have a peak water use of 1,325 liters (350 gallons) a day and a peak wastewater ow of 1,136 liters (300 gallons) a day. - Will have a constant level of water demand and wastewater ow throughout the year; will be 1 inch in diameter for the water connection and 4 inches in diameter for the sewerage connection. Standardized Warehouse Page 12   and 4 inches in diameter for the sewerage connection. Doing Business 2018 Cambodia Standardized Warehouse Estimated value of warehouse KHR 242,370,117.30 City Covered Phnom Penh East Asia & OECD high Indicator Cambodia Pacific income Overall Best Performer Procedures (number) 20 15.2 12.5 7.00 (Denmark) Time (days) 652 138.2 154.6 27.5 (Korea, Rep.) Cost (% of warehouse value) 5.3 2.2 1.6 0.10 (5 Economies) Building quality control index (0-15) 8.0 8.9 11.4 15.00 (3 Economies) Figure – Dealing with Construction Permits in Cambodia and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 82.19: Malaysia (Rank: 11) 75.25: Lao PDR (Rank: 40) 69.60: Regional Average (East Asia & Pacific) 66.84: Philippines (Rank: 101) 66.08: Indonesia (Rank: 108) 41.73: Cambodia (Rank: 179) Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their distance to frontier scores for dealing with construction permits. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Dealing with Construction Permits in Cambodia – Procedure, Time and Cost Time Cost 4.5 600 4 Cost (% of warehouse value) 500 3.5 3 400 Time (days) 2.5 300 2 1.5 200 1 100 0.5 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Page 13   component indicators. Doing Business 2018 Cambodia Figure – Dealing with Construction Permits in Cambodia – Procedure, Time and Cost Time Cost 4.5 600 4 Cost (% of warehouse value) 500 3.5 3 400 Time (days) 2.5 300 2 1.5 200 1 100 0.5 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Dealing with Construction Permits in Cambodia and comparator economies – Measure of Quality 14 13.0 13.0 12.0 12 10 8.9 Index score 8.0 8 6.5 6 4 2 0 Cambodia Indonesia Lao PDR Malaysia Philippines East Asia & Pacific Details – Dealing with Construction Permits in Cambodia – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Obtain application form 1 day KHR 4,500 Agency : Municipal Department of Land Management, Construction and Urban Planning   The application form and list of supporting documents must be picked up from the Municipal Department of Land Management, Construction and Urban Planning. 2 Submit documents to the Sangkat O ce for review 14 days no charge Agency : Sangkat O ce According to Subdecree No. 86 (dated December 19, 1997), relating to the construction permit, the documents attached to the o cial letter Page 14   Cambodia Indonesia Lao PDR Malaysia Philippines East Asia & Pacific Doing Business 2018 Cambodia Details – Dealing with Construction Permits in Cambodia – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Obtain application form 1 day KHR 4,500 Agency : Municipal Department of Land Management, Construction and Urban Planning   The application form and list of supporting documents must be picked up from the Municipal Department of Land Management, Construction and Urban Planning. 2 Submit documents to the Sangkat O ce for review 14 days no charge Agency : Sangkat O ce According to Subdecree No. 86 (dated December 19, 1997), relating to the construction permit, the documents attached to the o cial letter application must contain at least the following (10 copies on 21 x 29.7 cm paper): • Certi cate to the estate or title certi cate to the estate or the temporary occupation permit to the land • Sheet of plot (the basic plan of dimension of the land): this plan shall be made by a private land surveyor or by the land o ce’s private agent • Plan of warehouse location on the plot. This plan speci es the location of construction in the plot and the object of the application, by stating the following: the distance between one or more buildings and boundaries of the plot and the distance of the neighboring existing buildings; all arrangements of other sectors of the vacant land, with clari cation on the type of land and existing crops and planned car parks and fences; drainage pipes outside the building (substance, diameter, slope, height level, checking hole) up to the connection point of public network for draining sewage and for clean water, latrine, sink, and well; and stable point of the height of plot after the arrangement • Plan of all warehouse oors (scale 1:100) • Plan of the underground parts and latrine sinks (scale 1:100) • Plan of front warehouse (scale 1:100) • Plan of divided parts (scale 1:100). This plan shows the same as the front face plan, with one part showing the hygienic latrine sink • Table of the surface area for each oor • Technical speci cations for calculating the ground level surface. Upon receiving the construction permit, BuildCo must prepare a detailed plan of the construction integration. The Ministry of Public Works and Transportation will review this plan before the construction site is opened. There is no o cial fee; however, an informal fee must be paid to facilitate the application. 3 Request and obtain certi cation from the Khan or District Governor 182 days no charge Agency : Khan/ District Governor According to the Decision No. 05 SSR dated February 6, 2006 from the Ministry of Land Management, Urban Planning and Construction, this procedure must follow Procedure 2. The time frame should be 5 working days by law. The certi cation fee is not provided for by law. If informal fees are not paid, it generally takes between 4 months to 1 year to obtain the certi cation. Page 15   4 Submit documents to the Khan Land Management, Urban Planning, and 14 days no charge There is no o cial fee; however, an informal fee must be paid to facilitate the Doing application. Business 2018 Cambodia 3 Request and obtain certi cation from the Khan or District Governor 182 days no charge Agency : Khan/ District Governor According to the Decision No. 05 SSR dated February 6, 2006 from the Ministry of Land Management, Urban Planning and Construction, this procedure must follow Procedure 2. The time frame should be 5 working days by law. The certi cation fee is not provided for by law. If informal fees are not paid, it generally takes between 4 months to 1 year to obtain the certi cation. 4 Submit documents to the Khan Land Management, Urban Planning, and 14 days no charge Construction O ce for review and obtain approval Agency : Khan Land Management, Urban Planning, and Construction O ce The following documents must be submitted within 6 days after Procedure 2 has been completed: • Plot plan • Structural and engineering plans • Plan of the location of the warehouse on the plot • Plan of all warehouse oors. This plan speci es the purpose of using the rooms and the area, sanitation installation, and areas for pipes placing • Plan of the underground parts and the latrine sinks (scale, 1:100) • Plan of front building (scale 1:100): This plan speci es the front face plan, showing the height level of the following: each oor; land at the bottom of the building, by specifying the height level of natural land, lled land, or removal land; the roof and limit of roof or height of existing terrace and the wall barriers; existing ower's pole and substance for front face • Plan of divided parts (scale, 1:100): This plan shows the same as the front face plan with one part showing the hygienic latrine sink • Table of surface area for each oor • Technical speci cations for calculating the ground level surface • Additional documents: the applicant may be requested to provide additional documents for reasons of hydrology, prevention against all types of annoyance, public order, and protection of patrimony or landscape • Title certi cate • Application for construction permit (10 copies) There is no o cial fee; however, an informal fee must be paid. 5 Request and obtain the approval (building permit) of the Municipal 365 days KHR 10,000,000 Department of Land Management, Construction and Urban Planning Agency : Municipal Department of Land Management, Construction and Urban Planning BuildCo must le the documents with the Sangkat O ce/Commune rst, then to Khan/District), then with (a) the Municipality/Province for plots under 3,000 sq. m. or (b) the Ministry of Land Management, Urban Planning and Construction for plots above 3,000 sq. m. However, BuildCo does not need to visit each government o ce if the builder hires an agent who handles the construction permit application to completion. Fee schedule for construction permit according to the Joint Prakas 995 on provision of the Public Services Delivered by the Ministry of Land Management, Urban Plannign, and Construction : Surface of the construction on the land (SCL) less than or equal to • 100 sq. m.: KHR 1,000,000 • Less than or equal to 200.00 sq. m.: KHR 2,000,000 • Less than or equal to 300.00 sq. M.: KHR 3,000,000 • Less than or equal to 400.00 sq. m.: KHR 4,000,000 Page 16   • Less than or equal to 500.00 sq. m.: KHR 5,000,000 Doing There is no o Business cial fee; 2018 however, an informal fee must be paid. Cambodia 5 Request and obtain the approval (building permit) of the Municipal 365 days KHR 10,000,000 Department of Land Management, Construction and Urban Planning Agency : Municipal Department of Land Management, Construction and Urban Planning BuildCo must le the documents with the Sangkat O ce/Commune rst, then to Khan/District), then with (a) the Municipality/Province for plots under 3,000 sq. m. or (b) the Ministry of Land Management, Urban Planning and Construction for plots above 3,000 sq. m. However, BuildCo does not need to visit each government o ce if the builder hires an agent who handles the construction permit application to completion. Fee schedule for construction permit according to the Joint Prakas 995 on provision of the Public Services Delivered by the Ministry of Land Management, Urban Plannign, and Construction : Surface of the construction on the land (SCL) less than or equal to • 100 sq. m.: KHR 1,000,000 • Less than or equal to 200.00 sq. m.: KHR 2,000,000 • Less than or equal to 300.00 sq. M.: KHR 3,000,000 • Less than or equal to 400.00 sq. m.: KHR 4,000,000 • Less than or equal to 500.00 sq. m.: KHR 5,000,000 • Less than or equal to 1,000.00 sq. m.: KHR 8,000,000 • Less than or equal to 2,000.00 sq. m.: KHR 10,000,000 • Less than or equal to 3,000.00 sq. m.: KHR 12,000,000 Based on the Decision No. 5 SSR from the Ministry of Land Management Urban Planning and Construction, after the examination by the Khan Land O ce, the documents will be forwarded to the Phnom Penh Municipal Department of Land Management, Urban Planning and Construction and Cadastre (the "PP LO"). At the PP LO, the documents will be examined by the relevant o ces such as the Cadastral O ce, Technical and Geography O ce, Construction O ce, and Land Management O ce. After the approval of the PP LO, the documents will be forwarded to the Phnom Penh Municipality (the "PPM") who will have 5 days for a nal examination and issuance of the construction permit. The construction permit is valid for one year from the date of its issuance by the PPM and can be extended once for another year. Article 9.10 of the Sub Decree No. 86 on Construction Permit stipulates that after obtaining the Construction Permit, there shall be an iron structure plan which will be examined by the Ministry of Public Works and Transport. However, this is not enforced in practice, but maybe arbitrarily used by some o cials. 6 Notify the Sangkat O ce once the building permit is obtained 1 day no charge Agency : Sangkat O ce Under Cambodian regulation, after receiving the building permit from the provincial or municipal authority, the company must notify other relevant authorities. Construction work must commence within a year from the date of issuance of the construction permit. 7 Notify the Khan O ce once the building permit has been obtained 1 day no charge Agency : Khan O ce/ District 8 Request "construction site opening" from the Phnom Penh Municipal 1 day KHR 1,000,000 Department of Land Management, Urban Planning, and Construction and Cadastre (the "PP LO") Page 17   7 Notify the Khan O ce once the building permit has been obtained 1 day no charge Agency : Khan O ce/ District Doing Business 2018 Cambodia 8 Request "construction site opening" from the Phnom Penh Municipal 1 day KHR 1,000,000 Department of Land Management, Urban Planning, and Construction and Cadastre (the "PP LO") Agency : Phnom Penh Municipal Department of Land Management Urban Planning and Construction and Cadastre (the "PP LO") BuildCo must inform the authorities about the start of the construction within 7 days. Then the authority will issue a declaration of "construction site opening." In order to start construction and as required by Sub Decree No. 86 on Construction Permit and Decision No. 05, the construction owner shall apply to the PP LO (not the Khan Land O ce or the Sala Khan) for an approval to open the construction site. The PP LO will respond to the request within 6 days. According to the Prakas 995, this costs 10% of the building permit fee. 9 Receive an inspection from technical o cial 1 day no charge Agency : Technical Department The Technical Department sends an expert to inspect the construction site before construction starts. 10 Inform the building authority of the poles setup and receive inspection 1 day no charge Agency : Technical Department The inspector may visit the site without notifying BuildCo. The inspection takes a few hours, depending on the construction size and complexity. After receiving noti cation from BuildCo, an inspector will visit the site within 2 or 3 days. It is not necessary to stop the construction work. 11 Inform the building authority after foundation work and receive 1 day no charge inspection Agency : Technical Department 12 Inform the building authority when columns are built and receive 1 day no charge inspection Agency : Technical Department 13 Inform the building authority when walls are erected and receive 1 day no charge inspection Agency : Technical Department 14 Inform the building authority when oors are built and receive 1 day no charge inspection Agency : Technical Department 15 Inform the building authority upon completion of construction 1 day no charge Agency : Technical Department 16 Request connection to water and sewage services 1 day KHR 800,550 Agency : Phnom Penh Water Supply Authority (PPWSA) BuildCo must ll out some application forms for the water and sewage connection. BuildCo is not required to prepay government and service fees before, or at Page 18   the time of, the connection. Instead, it must pay the following only after 15 Inform the building authority upon completion of construction 1 day no charge Agency : Technical Department Doing Business 2018 Cambodia 16 Request connection to water and sewage services 1 day KHR 800,550 Agency : Phnom Penh Water Supply Authority (PPWSA) BuildCo must ll out some application forms for the water and sewage connection. BuildCo is not required to prepay government and service fees before, or at the time of, the connection. Instead, it must pay the following only after approval: the government fee (as listed below), the plumbing service fee [between KHR 200,000.00 (USD 50.00) and KHR 300,000.00 (USD 75.00) plus KHR 457,750.00 (USD 114.44)], and the water meter network length connection fee [KHR 92,800.00 (USD 23.20): water subscription cost)] = KHR 800,550.00. The water subscription fee for networks varies by water connection type (Point A and Point B) and is based on network length and water-meter size: Point A: Water subscription for new network is calculated as follows (for a network length of 15 mm): • 0 to 10 mm: KHR 457,750.00 (USD 114.44) • 11 mm to 20 mm: KHR 460,400.00 (USD 115.10) • 21 mm to 30 mm: KHR 665,200.00 (USD 166.30) • 31mm to 40 mm: KHR 772,250.00 (USD 193.06) • 41 mm up to 50 mm: KHR 878,500.00 (USD 219.62) Point B: Water subscription for available network with meter is calculated as follows (SN meter size water subscription fee): • 15 mm: KHR 92,800.00 (USD 23.20) • 20 mm: KHR 98,900.00 (USD 24.73) • 25 mm: KHR 106,900.00 (USD 26.73) • 30 mm: KHR 225,000.00 (USD 56.25) • 40 mm: KHR 271,000.00 (USD 67.75) 17 Receive inspection by water authorities and obtain water and sewage 42 days no charge connection Agency : Phnom Penh Water Supply Authority (PPWSA) According to Article 18 of Sub-Decree N0 89 the technical committee conducts inspection "during the connections of sewers, water and electricity systems.” In general, water and power supply companies must conduct on- site inspections to determine how to connect the construction to the network and to estimate the cost of this connection. In addition to providing water services, the utilities must ensure the connection is made according to the approved plan. 18 Inform the building authority once connection to utilities is complete 1 day no charge Agency : Khan O ce/ District 19 Receive nal inspection by the relevant authorities 1 day KHR 1,000,000 Agency : Khan O ce/District, Urbanization and Construction O ce, Municipality/ Provincial Authority At the end of construction, the District or Khan O ce and the Urbanization and Construction O ce may check simultaneously that the erected building complies with the construction permit speci cations. 20 Obtain certi cate of compliance from building authority 21 days no charge Agency : Khan O ce/ District Page 19   After the nal inspection, the municipal or provincial authority issues the and Construction O ce may check simultaneously that the erected building Doing complies Businesswith the construction 2018 Cambodia permit speci cations. 20 Obtain certi cate of compliance from building authority 21 days no charge Agency : Khan O ce/ District After the nal inspection, the municipal or provincial authority issues the certi cate of compliance or could take legal action for noncompliance. Takes place simultaneously with previous procedure. Details – Dealing with Construction Permits in Cambodia – Measure of Quality Answer Score Building quality control index (0-15) 8.0 Quality of building regulations index (0-2) 2.0 How accessible are building laws and regulations in your economy? (0-1) Available online; 1.0 Free of charge. Which requirements for obtaining a building permit are clearly speci ed in the building List of required 1.0 regulations or on any accessible website, brochure or pamphlet? (0-1) documents; Fees to be paid; Required preapprovals; Available only on request. Quality control before construction index (0-1) 1.0 Which third-party entities are required by law to verify that the building plans are in Licensed 1.0 compliance with existing building regulations? (0-1) architect; Licensed engineer. Quality control during construction index (0-3) 2.0 What types of inspections (if any) are required by law to be carried out during Inspections by 1.0 construction? (0-2) in-house engineer; Inspections at various phases. Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 1.0 inspections are always done in practice. Quality control after construction index (0-3) 2.0 Is there a nal inspection required by law to verify that the building was built in Yes, nal 2.0 accordance with the approved plans and regulations? (0-2) inspection is done by government agency. Do legally mandated nal inspections occur in practice? (0-1) Final inspection 0.0 does not always occur in practice. Page 20   Takes place simultaneously with previous procedure. Doing Business 2018 Cambodia Details – Dealing with Construction Permits in Cambodia – Measure of Quality Answer Score Building quality control index (0-15) 8.0 Quality of building regulations index (0-2) 2.0 How accessible are building laws and regulations in your economy? (0-1) Available online; 1.0 Free of charge. Which requirements for obtaining a building permit are clearly speci ed in the building List of required 1.0 regulations or on any accessible website, brochure or pamphlet? (0-1) documents; Fees to be paid; Required preapprovals; Available only on request. Quality control before construction index (0-1) 1.0 Which third-party entities are required by law to verify that the building plans are in Licensed 1.0 compliance with existing building regulations? (0-1) architect; Licensed engineer. Quality control during construction index (0-3) 2.0 What types of inspections (if any) are required by law to be carried out during Inspections by 1.0 construction? (0-2) in-house engineer; Inspections at various phases. Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 1.0 inspections are always done in practice. Quality control after construction index (0-3) 2.0 Is there a nal inspection required by law to verify that the building was built in Yes, nal 2.0 accordance with the approved plans and regulations? (0-2) inspection is done by government agency. Do legally mandated nal inspections occur in practice? (0-1) Final inspection 0.0 does not always occur in practice. Liability and insurance regimes index (0-2) 0.0 Which parties (if any) are held liable by law for structural aws or problems in the No party is held 0.0 building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1) liable under the law. Which parties (if any) are required by law to obtain an insurance policy to cover No party is 0.0 possible structural aws or problems in the building once it is in use (Latent Defect required by law Page 21   Liability Insurance or Decennial Insurance)? (0-1) to obtain building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1) liable under the Doing Business 2018 Cambodia law. Which parties (if any) are required by law to obtain an insurance policy to cover No party is 0.0 possible structural aws or problems in the building once it is in use (Latent Defect required by law Liability Insurance or Decennial Insurance)? (0-1) to obtain insurance . Professional certi cations index (0-4) 1.0 What are the quali cation requirements for the professional responsible for verifying University 1.0 that the architectural plans or drawings are in compliance with existing building degree in regulations? (0-2) architecture or engineering; Passing a certi cation exam. What are the quali cation requirements for the professional who supervises the University 0.0 construction on the ground? (0-2) degree in engineering, construction or construction management. Getting Electricity This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly constructed warehouse. Additionally, the reliability of supply and transparency of tari s index measures reliability of supply, transparency of tari s and the price of electricity. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to obtain an electricity connection To make the data comparable across economies, several assumptions are (number) used. Submitting all relevant documents and obtaining The warehouse: all necessary clearances and permits - Is owned by a local entrepreneur and is used for storage of goods. Completing all required notifications and - Is located in the economy’s largest business city. For 11 economies the receiving all necessary inspections data are also collected for the second largest business city. Obtaining external installation works and possibly - Is located in an area where similar warehouses are typically located and is purchasing material for these works in an area with no physical constraints. For example, the property is not Concluding any necessary supply contract and near a railway. obtaining final supply - Is a new construction and is being connected to electricity for the rst time. Time required to complete each procedure - Has two stories with a total surface area of approximately 1,300.6 square (calendar days) meters (14,000 square feet). The plot of land on which it is built is 929 Is at least 1 calendar day square meters (10,000 square feet). Each procedure starts on a separate day Does not include time spent gathering The electricity connection: information - Is a permanent one with a three-phase, four-wire Y connection with a subscribed capacity of 140-kilo-volt-ampere (kVA) with a power factor of 1, Reflects the time spent in practice, with little when 1 kVA = 1 kilowatt (kW). follow-up and no prior contact with officials - Has a length of 150 meters. The connection is to either the low- or Cost required to complete each procedure (% of medium-voltage distribution network and is either overhead or income per capita) underground, whichever is more common in the area where the Official costs only, no bribes warehouse is located and requires works that involve the crossing of a 10- meter road (such as by excavation or overhead lines) but are all carried out Page 22   Value added tax excluded on public land. There is no crossing of other owners’ private property construction management. Doing Business 2018 Cambodia Getting Electricity This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly constructed warehouse. Additionally, the reliability of supply and transparency of tari s index measures reliability of supply, transparency of tari s and the price of electricity. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to obtain an electricity connection To make the data comparable across economies, several assumptions are (number) used. Submitting all relevant documents and obtaining The warehouse: all necessary clearances and permits - Is owned by a local entrepreneur and is used for storage of goods. Completing all required notifications and - Is located in the economy’s largest business city. For 11 economies the receiving all necessary inspections data are also collected for the second largest business city. Obtaining external installation works and possibly - Is located in an area where similar warehouses are typically located and is purchasing material for these works in an area with no physical constraints. For example, the property is not Concluding any necessary supply contract and near a railway. obtaining final supply - Is a new construction and is being connected to electricity for the rst time. Time required to complete each procedure - Has two stories with a total surface area of approximately 1,300.6 square (calendar days) meters (14,000 square feet). The plot of land on which it is built is 929 Is at least 1 calendar day square meters (10,000 square feet). Each procedure starts on a separate day Does not include time spent gathering The electricity connection: information - Is a permanent one with a three-phase, four-wire Y connection with a subscribed capacity of 140-kilo-volt-ampere (kVA) with a power factor of 1, Reflects the time spent in practice, with little when 1 kVA = 1 kilowatt (kW). follow-up and no prior contact with officials - Has a length of 150 meters. The connection is to either the low- or Cost required to complete each procedure (% of medium-voltage distribution network and is either overhead or income per capita) underground, whichever is more common in the area where the Official costs only, no bribes warehouse is located and requires works that involve the crossing of a 10- meter road (such as by excavation or overhead lines) but are all carried out Value added tax excluded on public land. There is no crossing of other owners’ private property The reliability of supply and transparency of because the warehouse has access to a road. tari s index (0-8) - Does not require work to install the internal wiring of the warehouse. This has already been completed up to and including the customer’s service Duration and frequency of power outages (0–3) panel or switchboard and the meter base. Tools to monitor power outages (0–1) Tools to restore power supply (0–1) The monthly consumption: Regulatory monitoring of utilities’ performance - It is assumed that the warehouse operates 30 days a month from 9:00 (0–1) a.m. to 5:00 p.m. (8 hours a day), with equipment utilized at 80% of capacity Financial deterrents limiting outages (0–1) on average and that there are no electricity cuts (assumed for simplicity reasons) and the monthly energy consumption is 26,880 kilowatt-hours Transparency and accessibility of tariffs (0–1) (kWh); hourly consumption is 112 kWh. Price of electricity (cents per kilowatt-hour)* - If multiple electricity suppliers exist, the warehouse is served by the Price based on monthly bill for commercial cheapest supplier. warehouse in case study - Tari s e ective in March of the current year are used for calculation of the price of electricity for the warehouse. Although March has 31 days, for * N o t e : Doing Business m e a s u r e s t h e p r i c e o f calculation purposes only 30 days are used. electricity, but it is not included in the distance to frontier score nor the ranking on the ease of getting electricity. Page 23   Standardized Connection frontier score nor the ranking on the ease of getting electricity. Doing Business 2018 Cambodia Standardized Connection Price of electricity (US cents per kWh) 17.5 Name of utility Electricité du Cambodge City Covered Phnom Penh East Asia & OECD high Indicator Cambodia Pacific income Overall Best Performer Procedures (number) 4 4.5 4.7 2 (United Arab Emirates) Time (days) 179 71.6 79.1 10 (United Arab Emirates) Cost (% of income per capita) 1993.2 712.0 63.0 0.00 (Japan) Reliability of supply and transparency of tariff 3 3.7 7.4 8.00 (28 Economies) index (0-8) Figure – Getting Electricity in Cambodia and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 94.33: Malaysia (Rank: 8) 84.31: Philippines (Rank: 31) 83.87: Indonesia (Rank: 38) 72.23: Regional Average (East Asia & Pacific) 56.56: Cambodia (Rank: 137) 52.65: Lao PDR (Rank: 149) Note: The ranking of economies on the ease of getting electricity is determined by sorting their distance to frontier scores for getting electricity. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Getting Electricity in Cambodia – Procedure, Time and Cost Time Cost 2500 160 2000 Cost (% of income per capita) 140 120 Time (days) 1500 100 80 1000 60 40 500 20 Page 24   getting electricity. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Cambodia Figure – Getting Electricity in Cambodia – Procedure, Time and Cost Time Cost 2500 160 2000 Cost (% of income per capita) 140 120 Time (days) 1500 100 80 1000 60 40 500 20 0 0 1 *2 3 4 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Getting Electricity in Cambodia and comparator economies – Measure of Quality 9 8 8 7 6 Index score 5 5 5 4 3.7 3 3 2 2 1 0 Cambodia Indonesia Lao PDR Malaysia Philippines East Asia & Pacific Details – Getting Electricity in Cambodia – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Submit application to Electricite Du Cambodge and await estimate 41 calendar days KHR 0 Agency : Electricite Du Cambodge (EDC) The application should be submitted in person to the Distribution Department of Electricite Du Cambodge. The application should include the following documents: a certi cate of property title (a photocopy is su cient and there is no need for notarization) and a certi cate of company registration. The client has to ll a form specifying the power needed and the list of equipment in the warehouse. There are no o cial fees for the application. The time for this procedure includes an estimate for negotiation. Page 25   Cambodia Indonesia Lao PDR Malaysia Philippines East Asia & Pacific Doing Business 2018 Cambodia Details – Getting Electricity in Cambodia – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Submit application to Electricite Du Cambodge and await estimate 41 calendar days KHR 0 Agency : Electricite Du Cambodge (EDC) The application should be submitted in person to the Distribution Department of Electricite Du Cambodge. The application should include the following documents: a certi cate of property title (a photocopy is su cient and there is no need for notarization) and a certi cate of company registration. The client has to ll a form specifying the power needed and the list of equipment in the warehouse. There are no o cial fees for the application. The time for this procedure includes an estimate for negotiation. 2 Receive site inspection by Electricite Du Cambodge 1 calendar day KHR 0 Agency : Electricite Du Cambodge (EDC) The Distribution Department of EDC sends an inspector to check the site and the area. After the inspection the EDC will do the assessment and quotation of the prices. 3 Await clearance from Electricite Du Cambodge and sign contract 75 calendar days KHR 0 Agency : Distribution Department Electricite Du Cambodge (EDC) The consumer should obtain a clearance from the Distribution Department which has to assess whether EDC has enough capacity. The clearance is issued by the Managing Director of the Distribution Department. Once the clearance is issued the applicant signs a contract and pays fees. 4 Await completion of external works, meter installation and nal 63 calendar days KHR 96,619,168.72 connection Agency : Electricite Du Cambodge (EDC) and Electrical Contractor For an additional load of 140kVA installation of a transformer for 160 kVA will be required. The external connection works are carried out by EDC. The meter gets installed at the same time as when the connection is done. If there is a road crossing it takes EDC additional 2 weeks to obtain an excavation permit. The security deposit has to be paid and is returned upon the termination of the power consumption. There is no supervision / inspection of the internal wiring before the nal connection. EDC is responsible only for the external connection. The customer's private electrical engineer is in charge of the internal wiring. There is no requirement that the electrician must be licensed, so they can practice without a license. However, EDC is de facto the licencor of electrical engineers because they provide training courses. Attendees of this training receive a certi cate that EDC recognizes. There is no other agency that provides the courses. Takes place simultaneously with previous procedure. Details – Getting Electricity in Cambodia – Measure of Quality Page 26   Takes place simultaneously with previous procedure. Doing Business 2018 Cambodia Details – Getting Electricity in Cambodia – Measure of Quality Answer Reliability of supply and transparency of tari index (0-8) 3 Total duration and frequency of outages per customer a year (0-3) 0 System average interruption duration index (SAIDI) 22.8 System average interruption frequency index (SAIFI) 18.7 What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI 5.0 Mechanisms for monitoring outages (0-1) 0 Does the distribution utility use automated tools to monitor outages? No Mechanisms for restoring service (0-1) 1 Does the distribution utility use automated tools to restore service? Yes Regulatory monitoring (0-1) 1 Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on Yes reliability of supply? Financial deterrents aimed at limiting outages (0-1) 0 Does the utility either pay compensation to customers or face nes by the regulator (or both) if outages No exceed a certain cap? Communication of tari s and tari changes (0-1) 1 Are e ective tari s available online? Yes Link to the website, if available online http://eac.gov.kh/wp - content/uploads/20 16/03/072SR-16.pdf Are customers noti ed of a change in tari ahead of the billing cycle? Yes Note: If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparency of tari index. If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index. If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Registering Property This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has ve dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Page 27   If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Doing Business 2018 Cambodia Registering Property This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has ve dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to legally transfer title on immovable To make the data comparable across economies, several assumptions property (number) about the parties to the transaction, the property and the procedures are used. Preregistration procedures (for example, checking for liens, notarizing sales agreement, The parties (buyer and seller): paying property transfer taxes) - Are limited liability companies (or the legal equivalent). Registration procedures in the economy's largest - Are located in the periurban area of the economy’s largest business city. business citya. For 11 economies the data are also collected for the second largest Postregistration procedures (for example, filling business city. title with municipality) - Are 100% domestically and privately owned. Time required to complete each procedure - Have 50 employees each, all of whom are nationals. (calendar days) - Perform general commercial activities. Does not include time spent gathering information The property (fully owned by the seller): - Has a value of 50 times income per capita, which equals the sale price. Each procedure starts on a separate day - though - Is fully owned by the seller. procedures that can be fully completed online - Has no mortgages attached and has been under the same ownership for are an exception to this rule the past 10 years. Procedure is considered completed once final - Is registered in the land registry or cadastre, or both, and is free of title document is received disputes. No prior contact with officials - Is located in a periurban commercial zone, and no rezoning is required. Cost required to complete each procedure (% of - Consists of land and a building. The land area is 557.4 square meters property value) (6,000 square feet). A two-story warehouse of 929 square meters (10,000 square feet) is located on the land. The warehouse is 10 years old, is in Official costs only (such as administrative fees, good condition, has no heating system and complies with all safety duties and taxes). standards, building codes and legal requirements. The property, Value Added Tax, Capital Gains Tax and illicit consisting of land and building, will be transferred in its entirety. payments are excluded - Will not be subject to renovations or additional construction following the Quality of land administration index (0-30) purchase. - Has no trees, natural water sources, natural reserves or historical Reliability of infrastructure index (0-8) monuments of any kind. Transparency of information index (0–6) - Will not be used for special purposes, and no special permits, such as for Geographic coverage index (0–8) residential use, industrial plants, waste storage or certain types of agricultural activities, are required. Land dispute resolution index (0–8) - Has no occupants, and no other party holds a legal interest in it. Equal access to property rights index (-2–0) Standard Property Transfer Property value KHR 242,370,117.30 City Covered Phnom Penh Page 28   East Asia & OECD high Doing Business 2018 Cambodia Standard Property Transfer Property value KHR 242,370,117.30 City Covered Phnom Penh East Asia & OECD high Indicator Cambodia Pacific income Overall Best Performer Procedures (number) 7 5.5 4.6 1.00 (4 Economies) Time (days) 56 74.5 22.3 1.00 (3 Economies) Cost (% of property value) 4.3 4.3 4.2 0.00 (5 Economies) Quality of the land administration index (0-30) 7.5 15.8 22.7 29.00 (Singapore) Figure – Registering Property in Cambodia and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 76.06: Malaysia (Rank: 42) 69.55: Lao PDR (Rank: 65) 59.01: Indonesia (Rank: 106) 57.55: Philippines (Rank: 114) 57.21: Regional Average (East Asia & Pacific) 55.00: Cambodia (Rank: 123) Note: The ranking of economies on the ease of registering property is determined by sorting their distance to frontier scores for registering property. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Registering Property in Cambodia – Procedure, Time and Cost Time Cost 4.5 50 4 3.5 Cost (% of property value) 40 3 Time (days) 30 2.5 2 20 1.5 1 10 0.5 0 0 1 *2 *3 4 5 6 7 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Page 29   Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for registering property. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Cambodia Figure – Registering Property in Cambodia – Procedure, Time and Cost Time Cost 4.5 50 4 3.5 Cost (% of property value) 40 3 Time (days) 30 2.5 2 20 1.5 1 10 0.5 0 0 1 *2 *3 4 5 6 7 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Registering Property in Cambodia and comparator economies – Measure of Quality 30 27.5 25 20 Index score 15.8 15 12.5 11.3 10.5 10 7.5 5 0 Cambodia Indonesia Lao PDR Malaysia Philippines East Asia & Pacific Details – Registering Property in Cambodia – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 The buyer veri es the title certi cate with the Land O ce, checking for 10 days KHR 50,000 potential liens or encumbrances (simultaneous with Agency : Land O ce (District Level, O ce of the Ministry of Land Procedures 2 and Management, Urban Planning & Construction) 3) The buyer should obtain a copy of the initial title certi cate from the seller and verify proper ownership, ensuring that the seller is the rightful owner of the title certi cate. He veri es the title certi cate with the land o ce (it is also possible to start this procedure at the Land Department at the Provincial level) to ensure that there are no liens, mortgages or other encumbrances registered for that property. Page 30   O cial cost according the Prakas 995 dated of December 28th,2012 on Cambodia Indonesia Lao PDR Malaysia Philippines East Asia & Pacific Doing Business 2018 Cambodia Details – Registering Property in Cambodia – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 The buyer veri es the title certi cate with the Land O ce, checking for 10 days KHR 50,000 potential liens or encumbrances (simultaneous with Agency : Land O ce (District Level, O ce of the Ministry of Land Procedures 2 and Management, Urban Planning & Construction) 3) The buyer should obtain a copy of the initial title certi cate from the seller and verify proper ownership, ensuring that the seller is the rightful owner of the title certi cate. He veri es the title certi cate with the land o ce (it is also possible to start this procedure at the Land Department at the Provincial level) to ensure that there are no liens, mortgages or other encumbrances registered for that property. O cial cost according the Prakas 995 dated of December 28th,2012 on public service at Ministry of Land Management, Urban Planning and Construction 2 Obtain information on the property from the Commune Council O cial 10 days no cost Agency : Commune Council (simultaneous with Procedures 1 and The land purchaser may contact the village chief or the commune council 3) o cial to obtain information on the land in addition to an o cial search at the municipal land o ce. This procedure is not required by law, but it is an additional step to verify that there are no morel liens or other encumbrances a ecting the property object of the transaction 3 The buyer should obtain the certi cate of incorporation of the seller’s 10 days KHR 80,000 company and other documents from the seller (simultaneous with Agency : Ministry of Commerce Procedures 1 and 2) If the landowner is a legal entity, the buyer should obtain a copy of the ID of the shareholder or person acting on behalf of the company, and a certi ed/notarized copy of the certi cate of issued by the Ministry of Commerce. These documents are needed to verify the accuracy and identity of the company name appearing in the title certi cate. A Power of Attorney is also needed, as well as a resolution signed by the Board of Directors authorizing a named individual to represent the company at the land o ce accompanied by the Power of Attorney implementing that Resolution. This procedure is not required by law, but carried out in practice to verify information of the seller. 4 Apply for registration at the District Land O ce of the Ministry of Land 20-30 days KHR 600,000 Management, Urban Planning & Construction (MLMUPC) (Cadastral transfer Agency : Land O ce, (District Level, O ce of the Ministry of Land fee) Management, Urban Planning & Construction) When 2 persons/companies wish to buy/sell real property, together they should go to the district o ce of the Ministry of Land Management, Urban Planning & Construction (MLMUPC) and arrange to prepare and sign documents. The Land o ce reviews the document, checks the existing land book and sends it to the tax o ce to calculate the amount to be paid for the Transfer Tax. Before that, the tax o ce will send their sta to the eld to evaluate the property. They have to inspect the property and assess its value. Once the inspection is done, the tax o ce will ask the buyer to pay the transfer tax. Page 31   procedure is not required by law, but carried out in practice to verify Doing information of the seller. Business 2018 Cambodia 4 Apply for registration at the District Land O ce of the Ministry of Land 20-30 days KHR 600,000 Management, Urban Planning & Construction (MLMUPC) (Cadastral transfer Agency : Land O ce, (District Level, O ce of the Ministry of Land fee) Management, Urban Planning & Construction) When 2 persons/companies wish to buy/sell real property, together they should go to the district o ce of the Ministry of Land Management, Urban Planning & Construction (MLMUPC) and arrange to prepare and sign documents. The Land o ce reviews the document, checks the existing land book and sends it to the tax o ce to calculate the amount to be paid for the Transfer Tax. Before that, the tax o ce will send their sta to the eld to evaluate the property. They have to inspect the property and assess its value. Once the inspection is done, the tax o ce will ask the buyer to pay the transfer tax. In order to complete this procedure, a cadastral transfer fee of KHR 600,000 is paid to MLMUPC. The documentation shall include the company's statute, its Certi cate of Incorporation, and Power of Attorney (obtained in Procedure 3). At the time, the original Title Certi cate held by the seller must be presented to the Khan (District Level) at the time of signing the deed in order to have the name of the new owner inserted on the document. 5 Pay transfer tax at the Tax Collection O ce 1 day 4% of property value Agency : General Department of Taxation (transfer fee) A transfer tax of 4% of value of the property is paid by the seller to the Ministry of Economy and Finance at the Tax Collection O ce of the location of the transferred property. A Tax Receipt is issued to prove that the tax has been paid. The 4% transfer tax is set out in Article 40 of the Law on Finance for the year 1995. In Phnom Penh, this tax is not assessed based on the true transacted value of the property but based on a schedule of price of property determined by the Phnom Penh Municipality. The assessed value is usually based on the total number of square meters, the land's location, use etc. For the land of more than 1200m², the surplus is subject to unused land tax. For the land less than 1200m², the unused land tax is not applicable. The time for the tax o ce to complete the calculation of transfer tax will depend on the location of the land and its size. 6 Return to Cadastral o ce to complete the registration process 5 days Cadastral service Agency : Land Department (Province Level of the Ministry of Land paid in Procedure 4 Management, Urban Planning & Construction) After taxes are paid the parties return to the cadastral o ce at the MLMUPC and sign/thumbprint a MLMUPC form for buying/selling real property that was lled in by MLMUPC o cial. The signing/thumb printing will be witnessed by a local authority such as commune chief who will also thumbprint. These Procedures are based on Land Law Arts. 244 and 245. Land Law Art. 69 bars transfer unless all necessary taxes are paid. The documentation shall include: (1) Payment receipts of transfer tax (obtained in Procedure 5) 7 Obtain the certi cate of title from the Municipal Land O ce 13 days Already paid in Agency : Land Department (Province Level of the Ministry of Land Procedure 5 Management, Urban Planning & Construction) The Khan/District land o ce forwards all the "transfer documents" to the Page 32   Municipal Land O ce where it issues the Certi cate of Title in the new transfer unless all necessary taxes are paid. The documentation shall Doing include: Business 2018 receipts (1) Payment Cambodia of transfer tax (obtained in Procedure 5) 7 Obtain the certi cate of title from the Municipal Land O ce 13 days Already paid in Agency : Land Department (Province Level of the Ministry of Land Procedure 5 Management, Urban Planning & Construction) The Khan/District land o ce forwards all the "transfer documents" to the Municipal Land O ce where it issues the Certi cate of Title in the new owner's name and has it registered. The last procedural step in practice can take several weeks, depending on the diligence of the land o cials and interested parties. The Certi cate of Title is received at the Land Department (Khan level). Takes place simultaneously with previous procedure. Details – Registering Property in Cambodia – Measure of Quality Answer Score Quality of the land administration index (0-30) 7.5 Reliability of infrastructure index (0-8) 2.0 What is the institution in charge of immovable property registration? Phnom Penh Municipal Department of Land Management, Urban Planning and Construction In what format are the majority of title or deed records kept in the largest business city Paper 0.0 —in a paper format or in a computerized format (scanned or fully digital)? Is there an electronic database for checking for encumbrances (liens, mortgages, No 0.0 restrictions and the like)? Institution in charge of the plans showing legal boundaries in the largest business city: Khan O ce of Land Management, Urban Planning, Construction and Cadastral (District Level) In what format are the majority of maps of land plots kept in the largest business city— Paper 0.0 in a paper format or in a computerized format (scanned or fully digital)? Is there an electronic database for recording boundaries, checking plans and providing No 0.0 cadastral information (geographic information system)? Is the information recorded by the immovable property registration agency and the Di erent 1.0 cadastral or mapping agency kept in a single database, in di erent but linked databases databases but or in separate databases? linked Do the immovable property registration agency and cadastral or mapping agency use Yes 1.0 the same identi cation number for properties? Transparency of information index (0–6) 0.5 Page 33   Takes place simultaneously with previous procedure. Doing Business 2018 Cambodia Details – Registering Property in Cambodia – Measure of Quality Answer Score Quality of the land administration index (0-30) 7.5 Reliability of infrastructure index (0-8) 2.0 What is the institution in charge of immovable property registration? Phnom Penh Municipal Department of Land Management, Urban Planning and Construction In what format are the majority of title or deed records kept in the largest business city Paper 0.0 —in a paper format or in a computerized format (scanned or fully digital)? Is there an electronic database for checking for encumbrances (liens, mortgages, No 0.0 restrictions and the like)? Institution in charge of the plans showing legal boundaries in the largest business city: Khan O ce of Land Management, Urban Planning, Construction and Cadastral (District Level) In what format are the majority of maps of land plots kept in the largest business city— Paper 0.0 in a paper format or in a computerized format (scanned or fully digital)? Is there an electronic database for recording boundaries, checking plans and providing No 0.0 cadastral information (geographic information system)? Is the information recorded by the immovable property registration agency and the Di erent 1.0 cadastral or mapping agency kept in a single database, in di erent but linked databases databases but or in separate databases? linked Do the immovable property registration agency and cadastral or mapping agency use Yes 1.0 the same identi cation number for properties? Transparency of information index (0–6) 0.5 Who is able to obtain information on land ownership at the agency in charge of Only 0.0 immovable property registration in the largest business city? intermediaries and interested parties Is the list of documents that are required to complete any type of property transaction Yes, in person 0.0 made publicly available–and if so, how? Link for online access: Is the applicable fee schedule for any property transaction at the agency in charge of Yes, online 0.5 immovable property registration in the largest business city made publicly available– and if so, how? Page 34   Link for Doing online access: Business 2018 Cambodia Is the applicable fee schedule for any property transaction at the agency in charge of Yes, online 0.5 immovable property registration in the largest business city made publicly available– and if so, how? Link for online access: http://www.jica.g o.jp/cambodia/of ce/information/ investment/ku57 pq00001vq7zz- att/administrativ e_procedure_08. pdf Does the agency in charge of immovable property registration commit to delivering a No 0.0 legally binding document that proves property ownership within a speci c time frame– and if so, how does it communicate the service standard? Link for online access: Is there a speci c and separate mechanism for ling complaints about a problem that No 0.0 occurred at the agency in charge of immovable property registration? Contact information: Are there publicly available o cial statistics tracking the number of transactions at the No 0.0 immovable property registration agency? Number of property transfers in the largest business city in 2015: Who is able to consult maps of land plots in the largest business city? Only 0.0 intermediaries and interested parties Is the applicable fee schedule for accessing maps of land plots made publicly available No 0.0 —and if so, how? Link for online access: Does the cadastral or mapping agency commit to delivering an updated map within a No 0.0 speci c time frame—and if so, how does it communicate the service standard? Link for online access: Is there a speci c and separate mechanism for ling complaints about a problem that No 0.0 occurred at the cadastral or mapping agency? Contact information: Geographic coverage index (0–8) 0.0 Are all privately held land plots in the economy formally registered at the immovable No 0.0 property registry? Are all privately held land plots in the largest business city formally registered at the No 0.0 immovable property registry? Are all privately held land plots in the economy mapped? No 0.0 Are all privately held land plots in the largest business city mapped? No 0.0 Page 35   Are all privately held land plots in the largest business city formally registered at the No 0.0 immovable Doing property Business 2018 registry? Cambodia Are all privately held land plots in the economy mapped? No 0.0 Are all privately held land plots in the largest business city mapped? No 0.0 Land dispute resolution index (0–8) 5.0 Does the law require that all property sale transactions be registered at the immovable Yes 1.5 property registry to make them opposable to third parties? Is the system of immovable property registration subject to a state or private Yes 0.5 guarantee? Is there a speci c compensation mechanism to cover for losses incurred by parties who No 0.0 engaged in good faith in a property transaction based on erroneous information certi ed by the immovable property registry? Does the legal system require a control of legality of the documents necessary for a Yes 0.5 property transaction (e.g., checking the compliance of contracts with requirements of the law)? If yes, who is responsible for checking the legality of the documents? Registrar; Notary. Does the legal system require veri cation of the identity of the parties to a property Yes 0.5 transaction? If yes, who is responsible for verifying the identity of the parties? Registrar. Is there a national database to verify the accuracy of identity documents? No 0.0 For a standard land dispute between two local businesses over tenure rights of a Phnom Penh property worth 50 times gross national income (GNI) per capita and located in the Municipality largest business city, what court would be in charge of the case in the rst instance? Court of First Instance How long does it take on average to obtain a decision from the rst-instance court for Between 1 and 2 2.0 such a case (without appeal)? years Are there any statistics on the number of land disputes in the rst instance? No 0.0 Number of land disputes in the largest business city in 2015: Equal access to property rights index (-2–0) 0.0 Do unmarried men and unmarried women have equal ownership rights to property? Yes 0.0 Do married men and married women have equal ownership rights to property? Yes 0.0 Getting Credit This topic explores two sets of issues—the strength of credit reporting systems and the e ectiveness of collateral and bankruptcy laws in facilitating lending. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Strength of legal rights index (0–12) Doing Business assesses the sharing of credit information and the legal Page 36   rights of borrowers and lenders with respect to secured transactions Rights of borrowers and lenders through Do married men and married women have equal ownership rights to property? Yes 0.0 Doing Business 2018 Cambodia Getting Credit This topic explores two sets of issues—the strength of credit reporting systems and the e ectiveness of collateral and bankruptcy laws in facilitating lending. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Strength of legal rights index (0–12) Doing Business assesses the sharing of credit information and the legal rights of borrowers and lenders with respect to secured transactions Rights of borrowers and lenders through through 2 sets of indicators. The depth of credit information index collateral laws (0-10) measures rules and practices a ecting the coverage, scope and Protection of secured creditors’ rights through accessibility of credit information available through a credit registry or a bankruptcy laws (0-2) credit bureau. The strength of legal rights index measures the degree to Depth of credit information index (0–8) which collateral and bankruptcy laws protect the rights of borrowers and lenders and thus facilitate lending. For each economy it is first determined Scope and accessibility of credit information whether a unitary secured transactions system exists. Then two case distributed by credit bureaus and credit scenarios, case A and case B, are used to determine how a nonpossessory registries (0-8) security interest is created, publicized and enforced according to the law. Credit bureau coverage (% of adults) Special emphasis is given to how the collateral registry operates (if Number of individuals and firms listed in largest registration of security interests is possible). The case scenarios involve a credit bureau as a percentage of adult population secured borrower, company ABC, and a secured lender, BizBank. Credit registry coverage (% of adults) In some economies the legal framework for secured transactions will allow Number of individuals and firms listed in credit only case A or case B (not both) to apply. Both cases examine the same set registry as a percentage of adult population of legal provisions relating to the use of movable collateral. Several assumptions about the secured borrower (ABC) and lender (BizBank) are used: - ABC is a domestic limited liability company (or its legal equivalent). - ABC has up to 50 employees. - ABC has its headquarters and only base of operations in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city. - Both ABC and BizBank are 100% domestically owned. The case scenarios also involve assumptions. In case A, as collateral for the loan, ABC grants BizBank a nonpossessory security interest in one category of movable assets, for example, its machinery or its inventory. ABC wants to keep both possession and ownership of the collateral. In economies where the law does not allow nonpossessory security interests in movable property, ABC and BizBank use a fiduciary transfer-of-title arrangement (or a similar substitute for nonpossessory security interests). In case B, ABC grants BizBank a business charge, enterprise charge, floating charge or any charge that gives BizBank a security interest over ABC’s combined movable assets (or as much of ABC’s movable assets as possible). ABC keeps ownership and possession of the assets. East Asia & OECD high Indicator Cambodia Pacific income Overall Best Performer Strength of legal rights index (0-12) 10 7.2 6.0 12.00 (4 Economies) Depth of credit information index (0-8) 6 4.2 6.6 8.00 (34 Economies) Page 37   Credit registry coverage (% of adults) 0.0 16.0 18.3 100.00 (3 Economies) possible). ABC keeps ownership and possession of the assets. Doing Business 2018 Cambodia East Asia & OECD high Indicator Cambodia Pacific income Overall Best Performer Strength of legal rights index (0-12) 10 7.2 6.0 12.00 (4 Economies) Depth of credit information index (0-8) 6 4.2 6.6 8.00 (34 Economies) Credit registry coverage (% of adults) 0.0 16.0 18.3 100.00 (3 Economies) Credit bureau coverage (% of adults) 49.9 22.3 63.7 100.00 (23 Economies) Figure – Getting Credit in Cambodia and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 80.00: Cambodia (Rank: 20) 80.00: Malaysia (Rank: 20) 65.00: Indonesia (Rank: 55) 57.00: Regional Average (East Asia & Pacific) 55.00: Lao PDR (Rank: 77) 30.00: Philippines (Rank: 142) Note: The ranking of economies on the ease of getting credit is determined by sorting their distance to frontier scores for getting credit. These scores are the distance to frontier score for the sum of the strength of legal rights index and the depth of credit information index. Figure – Legal Rights in Cambodia and comparator economies 12 10 10 8 8 7.2 Index score 6 6 6 4 2 1 0 Cambodia Indonesia Lao PDR Malaysia Philippines East Asia & Pacific Details – Legal Rights in Cambodia Strength of legal rights index (0-12) 10 Does an integrated or uni ed legal framework for secured transactions that extends to the creation, publicity and Yes enforcement of functional equivalents to security interests in movable assets exist in the economy? Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without Yes requiring a speci c description of collateral? Page 38   Cambodia Indonesia Lao PDR Malaysia Philippines East Asia & Pacific Doing Business 2018 Cambodia Details – Legal Rights in Cambodia Strength of legal rights index (0-12) 10 Does an integrated or uni ed legal framework for secured transactions that extends to the creation, publicity and Yes enforcement of functional equivalents to security interests in movable assets exist in the economy? Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without Yes requiring a speci c description of collateral? Does the law allow businesses to grant a non possessory security right in substantially all of its assets, without requiring Yes a speci c description of collateral? May a security right extend to future or after-acquired assets, and does it extend automatically to the products, proceeds Yes or replacements of the original assets? Is a general description of debts and obligations permitted in collateral agreements; can all types of debts and Yes obligations be secured between parties; and can the collateral agreement include a maximum amount for which the assets are encumbered? Is a collateral registry in operation for both incorporated and non-incorporated entities, that is uni ed geographically Yes and by asset type, with an electronic database indexed by debtor's name? Does a notice-based collateral registry exist in which all functional equivalents can be registered? Yes Does a modern collateral registry exist in which registrations, amendments, cancellations and searches can be Yes performed online by any interested third party? Are secured creditors paid rst (i.e. before tax claims and employee claims) when a debtor defaults outside an insolvency Yes procedure? Are secured creditors paid rst (i.e. before tax claims and employee claims) when a business is liquidated? No Are secured creditors subject to an automatic stay on enforcement when a debtor enters a court-supervised No reorganization procedure? Does the law protect secured creditors’ rights by providing clear grounds for relief from the stay and/or sets a time limit for it? Does the law allow parties to agree on out of court enforcement at the time a security interest is created? Does the law Yes allow the secured creditor to sell the collateral through public auction or private tender, as well as, for the secured creditor to keep the asset in satisfaction of the debt? Figure – Credit Information in Cambodia and comparator economies 10 8 8 7 Index score 6 6 5 5 4.2 4 2 0 Cambodia Indonesia Lao PDR Malaysia Philippines East Asia & Pacific Details – Credit Information in Cambodia Page 39   0 Cambodia Doing Business 2018 Indonesia Cambodia Lao PDR Malaysia Philippines East Asia & Pacific Details – Credit Information in Cambodia Credit Credit Depth of credit information index (0-8) bureau registry Score Are data on both firms and individuals distributed? No No 0 Are both positive and negative credit data distributed? Yes No 1 Are data from retailers or utility companies - in addition to data from banks and financial institutions - No No 0 distributed? Are at least 2 years of historical data distributed? (Credit bureaus and registries that distribute more Yes No 1 than 10 years of negative data or erase data on defaults as soon as they are repaid obtain a score of 0 for this component.) Are data on loan amounts below 1% of income per capita distributed? Yes No 1 By law, do borrowers have the right to access their data in the credit bureau or credit registry? Yes No 1 Can banks and financial institutions access borrowers’ credit information online (for example, Yes No 1 through an online platform, a system-to-system connection or both)? Are bureau or registry credit scores offered as a value-added service to help banks and financial Yes No 1 institutions assess the creditworthiness of borrowers? Score ("yes" to either public bureau or private registry) 6 Note: An economy receives a score of 1 if there is a "yes" to either bureau or registry. If the credit bureau or registry is not operational or covers less than 5% of the adult population, the total score on the depth of credit information index is 0. Coverage Credit bureau Credit registry Number of individuals 5,059,897 0 Number of firms 0 0 Total 5,059,897 0 Percentage of adult population 49.9 0.0 Protecting Minority Investors This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain as well as shareholder rights, governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Extent of disclosure index (0–10): Review and To make the data comparable across economies, a case study uses several approval requirements for related-party assumptions about the business and the transaction. transactions; Disclosure requirements for related-party transactions The business (Buyer): Extent of director liability index (0–10): Ability of - Is a publicly traded corporation listed on the economy’s most important minority shareholders to sue and hold interested stock exchange. If the number of publicly traded companies listed on that directors liable for prejudicial related-party exchange is less than 10, or if there is no stock exchange in the economy, it is assumed that Buyer is a large private company with multiple Page 40   transactions; Available legal remedies (damages, Percentage of adult population 49.9 0.0 Doing Business 2018 Cambodia Protecting Minority Investors This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain as well as shareholder rights, governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Extent of disclosure index (0–10): Review and To make the data comparable across economies, a case study uses several approval requirements for related-party assumptions about the business and the transaction. transactions; Disclosure requirements for related-party transactions The business (Buyer): Extent of director liability index (0–10): Ability of - Is a publicly traded corporation listed on the economy’s most important minority shareholders to sue and hold interested stock exchange. If the number of publicly traded companies listed on that directors liable for prejudicial related-party exchange is less than 10, or if there is no stock exchange in the economy, it transactions; Available legal remedies (damages, is assumed that Buyer is a large private company with multiple disgorgement of profits, fines, imprisonment, shareholders. rescission of the transaction) - Has a board of directors and a chief executive o cer (CEO) who may legally act on behalf of Buyer where permitted, even if this is not speci cally Ease of shareholder suits index (0–10): Access to required by law. internal corporate documents; Evidence - Has a supervisory board (applicable to economies with a two-tier board obtainable during trial and allocation of legal system) on which 60% of the shareholder-elected members have been expenses appointed by Mr. James, who is Buyer’s controlling shareholder and a Extent of conflict of interest regulation index member of Buyer’s board of directors. (0–10): Simple average of the extent of disclosure, - Has not adopted any bylaws or articles of association that di er from extent of director liability and ease of default minimum standards and does not follow any nonmandatory codes, shareholder indices principles, recommendations or guidelines relating to corporate Extent of shareholder rights index (0-10): governance. Shareholders’ rights and role in major corporate - Is a manufacturing company with its own distribution network. decisions Extent of ownership and control index (0-10): The transaction involves the following details: Governance safeguards protecting shareholders - Mr. James owns 60% of Buyer and elected two directors to Buyer’s ve- from undue board control and entrenchment member board. Extent of corporate transparency index (0-10): - Mr. James also owns 90% of Seller, a company that operates a chain of Corporate transparency on ownership stakes, retail hardware stores. Seller recently closed a large number of its stores. compensation, audits and financial prospects - Mr. James proposes that Buyer purchase Seller’s unused eet of trucks to expand Buyer’s distribution of its food products, a proposal to which Buyer Extent of shareholder governance index (0–10): agrees. The price is equal to 10% of Buyer’s assets and is higher than the Simple average of the extent of shareholders market value. rights, extent of ownership and control and - The proposed transaction is part of the company’s ordinary course of extent of corporate transparency indices business and is not outside the authority of the company. Strength of minority investor protection index - Buyer enters into the transaction. All required approvals are obtained, (0–10): Simple average of the extent of conflict of and all required disclosures made (that is, the transaction is not interest regulation and extent of shareholder fraudulent). governance indices - The transaction causes damages to Buyer. Shareholders sue Mr. James and the other parties that approved the transaction. East Asia & OECD high Indicator Cambodia Pacific income Overall Best Performer Extent of conflict of interest regulation index (0- 6.7 5.7 6.4 9.3 (New Zealand) 10) Extent of shareholder governance index (0-10) 3.3 4.8 6.4 Page 41   9.00 (Kazakhstan) and the other parties that approved the transaction. Doing Business 2018 Cambodia East Asia & OECD high Indicator Cambodia Pacific income Overall Best Performer Extent of conflict of interest regulation index (0- 6.7 5.7 6.4 9.3 (New Zealand) 10) Extent of shareholder governance index (0-10) 3.3 4.8 6.4 9.00 (Kazakhstan) Figure – Protecting Minority Investors in Cambodia and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 80.00: Malaysia (Rank: 4) 63.33: Indonesia (Rank: 43) 52.33: Regional Average (East Asia & Pacific) 50.00: Cambodia (Rank: 108) 40.00: Philippines (Rank: 146) 31.67: Lao PDR (Rank: 172) Note: The ranking of economies on the strength of minority investor protections is determined by sorting their distance to frontier scores for protecting minority investors. These scores are the simple average of the distance to frontier scores for the extent of con ict of interest regulation index and the extent of shareholder governance index. Figure – Protecting Minority Investors in Cambodia and comparator economies – Measure of Quality Cambodia 6 10 6 3 1 4 Indonesia 7 5 10 7 7 2 Lao PDR 1 1 6 4 4 3 Malaysia 8 9 10 6 8 7 Philippines 7 3 2 5 0 7 OECD high income 7.3 5.6 6.5 5.2 6.3 7.4 East Asia & Pacific 5.6 4.6 6.2 3.9 5.3 6.1 0 10 20 30 40 50 60 Sub-Indicator Score Extent of corporate transparency index (0­10) Extent of director liability index (0­10) Extent of disclosure index (0­10) Extent of ownership and control index (0­10) Extent of shareholder rights index (0­10) Ease of shareholder suits index (0­10) Details – Protecting Minority Investors in Cambodia – Measure of Quality Answer Score Page 42   Extent of ownership and control index (0­10) Extent of shareholder rights index (0­10) Ease of shareholder suits index (0­10) Doing Business 2018 Cambodia Details – Protecting Minority Investors in Cambodia – Measure of Quality Answer Score Extent of con ict of interest regulation index (0-10) 6.7 Extent of disclosure index (0-10) 6 Which corporate body is legally su cient to approve the Buyer-Seller transaction? (0-3) Board of 2.0 directors excluding interested members Must an external body review the terms of the transaction before it takes place? (0-1) No 0.0 Must Mr. James disclose his con ict of interest to the board of directors? (0-2) Full disclosure of 2.0 all material facts Must Buyer disclose the transaction in published periodic lings (annual reports)? (0-2) Disclosure on 2.0 the transaction and on the con ict of interest Must Buyer immediately disclose the transaction to the public and/or shareholders? (0- No disclosure 0.0 2) obligation Extent of director liability index (0-10) 10 Can shareholders representing 10% of Buyer's share capital sue directly or derivatively Yes 1.0 for the damage the transaction caused to Buyer? (0-1) Can shareholders hold the interested director liable for the damage the transaction Liable if unfair or 2.0 caused to Buyer? (0-2) prejudicial Can shareholders hold the other directors liable for the damage the transaction caused Liable if unfair or 2.0 to Buyer (0-2) prejudicial Must Mr. James pay damages for the harm caused to Buyer upon a successful claim by Yes 1.0 shareholders? (0-1) Must Mr. James repay pro ts made from the transaction upon a successful claim by Yes 1.0 shareholders? (0-1) Is Mr. James disquali ed or ned and imprisoned upon a successful claim by Yes 1.0 shareholders? (0-1) Can a court void the transaction upon a successful claim by shareholders? (0-2) Voidable if unfair 2.0 or prejudicial Ease of shareholder suits index (0-10) 4 Before suing can shareholders representing 10% of Buyer's share capital inspect the Yes 1.0 transaction documents? (0-1) Can the plainti obtain any documents from the defendant and witnesses at trial? (0-3) No 0.0 Can the plainti request categories of documents from the defendant without No 0.0 identifying speci c ones? (0-1) Page 43   Can the Doing obtain any plainti 2018 Business documents from the defendant and witnesses at trial? (0-3) Cambodia No 0.0 Can the plainti request categories of documents from the defendant without No 0.0 identifying speci c ones? (0-1) Can the plainti directly question the defendant and witnesses at trial? (0-2) Yes 2.0 Is the level of proof required for civil suits lower than that of criminal cases? (0-1) No 0.0 Can shareholder plainti s recover their legal expenses from the company? (0-2) Yes if successful 1.0 Extent of shareholder governance index (0-10) 3.3 Extent of shareholder rights index (0-10) 1 Does the sale of 51% of Buyer's assets require shareholder approval? No 0.0 Can shareholders representing 10% of Buyer's share capital call for a meeting of No 0.0 shareholders? Must Buyer obtain its shareholders’ approval every time it issues new shares? No 0.0 Do shareholders automatically receive preemption rights every time Buyer issues new No 0.0 shares? Must shareholders approve the election and dismissal of the external auditor? No 0.0 Are changes to the rights of a class of shares only possible if the holders of the a ected Yes 1.0 shares approve? Assuming that Buyer is a limited company, does the sale of 51% of its assets require No 0.0 member approval? Assuming that Buyer is a limited company, can members representing 10% call for a No 0.0 meeting of members? Assuming that Buyer is a limited company, must all members consent to add a new No 0.0 member? Assuming that Buyer is a limited company, must a member rst o er to sell their No 0.0 interest to the existing members before they can sell to non-members? Extent of ownership and control index (0-10) 3 Is it forbidden to appoint the same individual as CEO and chair of the board of No 0.0 directors? Must the board of directors include independent and nonexecutive board members? Yes 1.0 Can shareholders remove members of the board of directors without cause before the Yes 1.0 end of their term? Must the board of directors include a separate audit committee exclusively comprising Yes 1.0 board members? Must a potential acquirer make a tender o er to all shareholders upon acquiring 50% No 0.0 of Buyer? Must Buyer pay declared dividends within a maximum period set by law? No 0.0 Is a subsidiary prohibited from acquiring shares issued by its parent company? No 0.0 Assuming that Buyer is a limited company, must Buyer have a mechanism to resolve No 0.0 Page 44   Buyer pay declared MustBusiness Doing dividends within a maximum period set by law? 2018 Cambodia No 0.0 Is a subsidiary prohibited from acquiring shares issued by its parent company? No 0.0 Assuming that Buyer is a limited company, must Buyer have a mechanism to resolve No 0.0 disagreements among members? Assuming that Buyer is a limited company, must a potential acquirer make a tender No 0.0 o er to all shareholders upon acquiring 50% of Buyer? Assuming that Buyer is a limited company, must Buyer distribute pro ts within a No 0.0 maximum period set by law? Extent of corporate transparency index (0-10) 6 Must Buyer disclose direct and indirect bene cial ownership stakes representing 5%? No 0.0 Must Buyer disclose information about board members’ primary employment and Yes 1.0 directorships in other companies? Must Buyer disclose the compensation of individual managers? Yes 1.0 Must a detailed notice of general meeting be sent 21 days before the meeting? No 0.0 Can shareholders representing 5% of Buyer’s share capital put items on the general Yes 1.0 meeting agenda? Must Buyer's annual nancial statements be audited by an external auditor? Yes 1.0 Must Buyer disclose its audit reports to the public? Yes 1.0 Assuming that Buyer is a limited company, must members meet at least once a year? No 0.0 Assuming that Buyer is a limited company, can members representing 5% put items on No 0.0 the meeting agenda? Assuming that Buyer is a limited company, must Buyer's annual nancial statements be Yes 1.0 audited by an external auditor? Paying Taxes This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as measures the administrative burden in paying taxes and contributions. The most recent round of data collection for the project was completed on June 30, 2017 covering for the Paying Taxes indicator calendar year 2016 (January 1, 2016 – December 31, 2016). Last year (Doing Business 2017) the scope of data collection was expanded to better understand the overall tax environment in an economy. The questionnaire was expanded to include new questions on post- ling processes: VAT refund and tax audit. The data shows where post ling processes and practices work e ciently and what drives the di erences in the overall tax compliance cost across economies. The new section covers both the legal framework and the administrative burden on businesses to comply with post ling processes. See the methodology for more information. What the indicators measure Case study assumptions Tax payments for a manufacturing company in Using a case scenario, Doing Business records taxes and mandatory 2016 (number per year adjusted for electronic and contributions a medium size company must pay in a year, and measures joint ling and payment) the administrative burden of paying taxes, contributions and dealing with post ling processes. Information is also compiled on frequency of ling Total number of taxes and contributions paid, Page 45   and payments, time taken to comply with tax laws, time taken to comply including consumption taxes (value added tax, Assuming that Buyer is a limited company, must Buyer's annual nancial statements be Yes 1.0 audited by an external auditor? Doing Business 2018 Cambodia Paying Taxes This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as measures the administrative burden in paying taxes and contributions. The most recent round of data collection for the project was completed on June 30, 2017 covering for the Paying Taxes indicator calendar year 2016 (January 1, 2016 – December 31, 2016). Last year (Doing Business 2017) the scope of data collection was expanded to better understand the overall tax environment in an economy. The questionnaire was expanded to include new questions on post- ling processes: VAT refund and tax audit. The data shows where post ling processes and practices work e ciently and what drives the di erences in the overall tax compliance cost across economies. The new section covers both the legal framework and the administrative burden on businesses to comply with post ling processes. See the methodology for more information. What the indicators measure Case study assumptions Tax payments for a manufacturing company in Using a case scenario, Doing Business records taxes and mandatory 2016 (number per year adjusted for electronic and contributions a medium size company must pay in a year, and measures joint ling and payment) the administrative burden of paying taxes, contributions and dealing with post ling processes. Information is also compiled on frequency of ling Total number of taxes and contributions paid, and payments, time taken to comply with tax laws, time taken to comply including consumption taxes (value added tax, with the requirements of post ling processes and time waiting. sales tax or goods and service tax) Method and frequency of filing and payment To make data comparable across economies, several assumptions are used: Time required to comply with 3 major taxes - TaxpayerCo is a medium-size business that started operations on January (hours per year) 1, 2015. It produces ceramic flowerpots and sells them at retail. All taxes Collecting information, computing tax payable and contributions recorded are paid in the second year of operation Completing tax return, filing with agencies (calendar year 2016). Taxes and mandatory contributions are measured at all levels of government. Arranging payment or withholding Preparing separate tax accounting books, if The VAT refund process: required - In June 2016, TaxpayerCo. makes a large capital purchase: the value of the Total tax and contribution rate (% of pro t before machine is 65 times income per capita of the economy. Sales are equally all taxes) spread per month (1,050 times income per capita divided by 12) and cost of goods sold are equally expensed per month (875 times income per Profit or corporate income tax capita divided by 12). The machinery seller is registered for VAT and excess Social contributions, labor taxes paid by input VAT incurred in June will be fully recovered after four consecutive employer months if the VAT rate is the same for inputs, sales and the machine and Property and property transfer taxes the tax reporting period is every month. Input VAT will exceed Output VAT Dividend, capital gains, financial transactions in June 2016. taxes The corporate income tax audit process: Waste collection, vehicle, road and other taxes - An error in calculation of income tax liability (for example, use of incorrect Post ling Index tax depreciation rates, or incorrectly treating an expense as tax deductible) leads to an incorrect income tax return and a corporate income Time to comply with a VAT refund tax underpayment. TaxpayerCo. discovered the error and voluntarily Time to receive a VAT refund noti ed the tax authority. The value of the underpaid income tax liability is Time to comply with a corporate income tax audit 5% of the corporate income tax liability due. TaxpayerCo. submits corrected information after the deadline for submitting the annual tax Time to complete a corporate income tax audit return, but within the tax assessment period. East Asia & OECD high Indicator Cambodia Pacific income Overall Best Performer Payments (number per year) 40 21.8 10.9 3 (Hong Kong SAR, China) Page 46   return, but within the tax assessment period. Doing Business 2018 Cambodia East Asia & OECD high Indicator Cambodia Pacific income Overall Best Performer Payments (number per year) 40 21.8 10.9 3 (Hong Kong SAR, China) Time (hours per year) 173 189.2 160.7 55 (Luxembourg) Total tax and contribution rate (% of profit) 21.7 33.6 40.1 18.47% (32 Economies) Postfiling index (0-100) 25.97 56.55 83.45 99.38 (Estonia) Figure – Paying Taxes in Cambodia and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 76.07: Malaysia (Rank: 73) 72.42: Regional Average (East Asia & Pacific) 69.27: Philippines (Rank: 105) 68.04: Indonesia (Rank: 114) 61.28: Cambodia (Rank: 136) 54.18: Lao PDR (Rank: 156) Note: The ranking of economies on the ease of paying taxes is determined by sorting their distance to frontier scores on the ease of paying taxes. These scores are the simple average of the distance to frontier scores for each of the four component indicators – number of tax payments. time, total tax rate and post ling index – with a threshold and a nonlinear transformation applied to one of the component indicators, the total tax rate. The nonlinear distance to frontier for the total tax rate is equal to the distance to frontier for the total tax rate to the power of 0.8. The threshold is de ned as the total tax rate at the 15th percentile of the overall distribution for all years included in the analysis up to and including Doing Business 2015, which is 26.1%. All economies with a total tax rate below this threshold receive the same score as the economy at the threshold. Figure – Paying Taxes in Cambodia and comparator economies – Measure of Quality 80 68.82 70 60 56.55 52.65 50.00 Index score 50 40 30 25.97 18.57 20 10 0 Cambodia Indonesia Lao PDR Malaysia Philippines East Asia & Pacific Details – Paying Taxes in Cambodia Tax or Total tax and mandatory Payments Notes on Time contribution rate Notes contribution (number) Payments (hours) Statutory tax rate Tax base (% of profit) on TTR Page 47   Corporate 12 23 20% on profits or 1% taxable profit 19.35 Doing Business 2018 Cambodia Figure – Paying Taxes in Cambodia and comparator economies – Measure of Quality 80 68.82 70 60 56.55 52.65 50.00 Index score 50 40 30 25.97 18.57 20 10 0 Cambodia Indonesia Lao PDR Malaysia Philippines East Asia & Pacific Details – Paying Taxes in Cambodia Tax or Total tax and mandatory Payments Notes on Time contribution rate Notes contribution (number) Payments (hours) Statutory tax rate Tax base (% of profit) on TTR Corporate 12 23 20% on profits or 1% taxable profit 19.35 income tax on turnover (whichever is higher) Patent tax 1 KHR 3,000,000 fixed fee 1.39 Social 12 84 0.8% gross salaries 0.55 security contributions Transport tax 1 KHR 774,206 fixed fee depending on 0.36 type of vehicle Tax on 0 4% interest income 0.10 not interest included Tax on 1 0.1% (the value of 0.07 Immovable immovable Property property*80%) – KHR 100,000,000 Fuel tax 1 included in the fuel 0.00 small price amount Value added 12 66 10% value added 0.00 not tax (VAT) included Totals 40 173 21.7 Details – Paying Taxes in Cambodia – Tax by Type Taxes by type Answer Profit tax (% of profit) 19.4 Labor tax and contributions (% of profit) 0.5 Page 48   Totals 40 173 21.7 Doing Business 2018 Cambodia Details – Paying Taxes in Cambodia – Tax by Type Taxes by type Answer Profit tax (% of profit) 19.4 Labor tax and contributions (% of profit) 0.5 Other taxes (% of profit) 1.8 Details – Paying Taxes in Cambodia – Measure of Quality Answer Score Post ling index (0-100) 25.97 VAT refunds Does VAT exist? Yes Does a VAT refund process exist per the case study? Yes Restrictions on VAT refund process Carry forward for 3months Percentage of cases exposed to a VAT audit (%) 75% - 100% Is there a mandatory carry forward period? Yes Time to comply with VAT refund (hours) 21.0 58 Time to obtain a VAT refund (weeks) 63.9 0 Corporate income tax audits Does corporate income tax exist? Yes Percentage of cases exposed to a corporate income tax audit (%) 75% - 100% Time to comply with a corporate income tax audit (hours) 31.0 45.87 Time to complete a corporate income tax audit (weeks) 39.4 0 Notes: Names of taxes have been standardized. For instance income tax, pro t tax, tax on company's income are all named corporate income tax in this table. The hours for VAT include all the VAT and sales taxes applicable. The hours for Social Security include all the hours for labor taxes and mandatory contributions in general. The post ling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax audit and time to complete a corporate income tax audit. N/A = Not applicable. Trading across Borders Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures the time and cost (excluding tari s) associated with three sets of procedures—documentary compliance, border compliance and domestic transport—within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Page 49   a corporate income tax audit and time to complete a corporate income tax audit. N/A = Not applicable. Doing Business 2018 Cambodia Trading across Borders Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures the time and cost (excluding tari s) associated with three sets of procedures—documentary compliance, border compliance and domestic transport—within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Given the importance of trade digitalization, in Doing Business 2018, the Trading across Borders questionnaire included research questions on the availability and status of implementation of Electronic Data Interchange (EDI) and Single Window (SW) systems. With this information, Doing Business built a comprehensive dataset on the adoption and level of sophistication of electronic platforms in 190 economies. These data are not used to compute the distance to frontier score or ranking of the ease of doing business. The new dataset on EDI and SW systems is available here. What the indicators measure Case study assumptions Documentary compliance To make the data comparable across economies, a few assumptions are made about the traded goods and the transactions: Obtaining, preparing and submitting documents during transport, clearance, inspections and port Time: Time is measured in hours, and 1 day is 24 hours (for example, 22 or border handling in origin economy days are recorded as 22×24=528 hours). If customs clearance takes 7.5 Obtaining, preparing and submitting documents hours, the data are recorded as is. Alternatively, suppose documents are required by destination economy and any transit submitted to a customs agency at 8:00a.m., are processed overnight and economies can be picked up at 8:00a.m. the next day. The time for customs clearance Covers all documents required by law and in would be recorded as 24 hours because the actual procedure took 24 practice, including electronic submissions of hours. information Border compliance Cost: Insurance cost and informal payments for which no receipt is issued are excluded from the costs recorded. Costs are reported in U.S. dollars. Customs clearance and inspections Contributors are asked to convert local currency into U.S. dollars based on Inspections by other agencies (if applied to more the exchange rate prevailing on the day they answer the questionnaire. than 20% of shipments) Contributors are private sector experts in international trade logistics and Handling and inspections that take place at the are informed about exchange rates. economy’s port or border Assumptions of the case study: - For all 190 economies covered by Doing Domestic transport Business, it is assumed a shipment is in a warehouse in the largest Loading or unloading of the shipment at the business city of the exporting economy and travels to a warehouse in the warehouse or port/border largest business city of the importing economy. - It is assumed each Transport between warehouse and port/border economy imports 15 metric tons of containerized auto parts (HS 8708) from its natural import partner—the economy from which it imports the Traffic delays and road police checks while shipment is en route largest value (price times quantity) of auto parts. It is assumed each economy exports the product of its comparative advantage (de ned by the largest export value) to its natural export partner—the economy that is the largest purchaser of this product. Shipment value is assumed to be $50,000. - The mode of transport is the one most widely used for the chosen export or import product and the trading partner, as is the seaport, or land border crossing. - All electronic information submissions requested by any government agency in connection with the shipment are considered to be documents obtained, prepared and submitted during the export or import process. - A port or border is a place (seaport, airport or land border crossing) where merchandise can enter or leave an economy. - Relevant government agencies include customs, port authorities, road police, border guards, standardization agencies, ministries or departments of agriculture or industry, national security agencies and any other government authorities. Page 50   of agriculture or industry, national security agencies and any other Doing Business 2018 Cambodia government authorities. East Asia & OECD high Indicator Cambodia Pacific income Overall Best Performer Time to export: Border compliance (hours) 48 55.9 12.7 0 (17 Economies) Cost to export: Border compliance (USD) 375 387.5 149.9 0.00 (19 Economies) Time to export: Documentary compliance 132 68.2 2.4 1.0 (25 Economies) (hours) Cost to export: Documentary compliance (USD) 100 112.1 35.4 0.00 (19 Economies) Time to import: Border compliance (hours) 8 70.5 8.7 0.00 (21 Economies) Cost to import: Border compliance (USD) 240 431.0 111.6 0.00 (27 Economies) Time to import: Documentary compliance 132 65.6 3.5 1.0 (30 Economies) (hours) Cost to import: Documentary compliance (USD) 120 111.4 25.6 0.00 (30 Economies) Figure – Trading across Borders in Cambodia and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 82.75: Malaysia (Rank: 61) 69.97: Regional Average (East Asia & Pacific) 69.39: Philippines (Rank: 99) 67.28: Cambodia (Rank: 108) 66.59: Indonesia (Rank: 112) 62.98: Lao PDR (Rank: 124) Note: The ranking of economies on the ease of trading across borders is determined by sorting their distance to frontier scores for trading across borders. These scores are the simple average of the distance to frontier scores for the time and cost for documentary compliance and border compliance to export and import (domestic transport is not used for calculating the ranking). Figure – Trading across Borders in Cambodia – Time and Cost Time Cost 140 375 132 132 400 120 350 300 100 240 Time (hours) Cost (USD) 250 80 200 60 48 120 150 40 100 100 20 8 50 0 0 Export - Border Compliance Export - Documentary Compliance Import - Border Compliance Import - Documentary CompliancePage 51   Doing Business 2018 Cambodia Figure – Trading across Borders in Cambodia – Time and Cost Time Cost 140 375 132 132 400 120 350 300 100 240 Time (hours) Cost (USD) 250 80 200 60 48 120 150 40 100 100 20 8 50 0 0 Export - Border Compliance Export - Documentary Compliance Import - Border Compliance Import - Documentary Compliance Details – Trading across Borders in Cambodia Characteristics Export Import Product HS 61 : Articles of apparel and clothing accessories, HS 8708: Parts and accessories of knitted or crocheted motor vehicles Trade partner United States Thailand Border Sihanoukville port Poipet border crossing Distance (km) 224 412 Domestic transport time 6 11 (hours) Domestic transport cost 200 1125 (USD) Details – Trading across Borders in Cambodia – Components of Border Compliance Time to Complete Associated Costs (hours) (USD) Export: Clearance and inspections required by customs authorities 28.3 275.0 Export: Clearance and inspections required by agencies other than customs 0.0 0.0 Export: Port or border handling 24.0 100.0 Import: Clearance and inspections required by customs authorities 4.3 240.0 Import: Clearance and inspections required by agencies other than customs 0.0 0.0 Import: Port or border handling 7.5 0.0 Details – Trading across Borders in Cambodia – Trade Documents Export Import Page 52   (USD) Doing Business 2018 Cambodia Details – Trading across Borders in Cambodia – Components of Border Compliance Time to Complete Associated Costs (hours) (USD) Export: Clearance and inspections required by customs authorities 28.3 275.0 Export: Clearance and inspections required by agencies other than customs 0.0 0.0 Export: Port or border handling 24.0 100.0 Import: Clearance and inspections required by customs authorities 4.3 240.0 Import: Clearance and inspections required by agencies other than customs 0.0 0.0 Import: Port or border handling 7.5 0.0 Details – Trading across Borders in Cambodia – Trade Documents Export Import Customs Export Declaration Customs Import Declaration Commercial Invoice Commercial Invoice Packing List Packing List Bill of Lading Road Transport Document Terminal Handling Receipts Import Permit Insurance Certificate Insurance Certificate Export Permit Tax Certificate Certificate of Origin Certificate of Origin SOLAS certificate Company Registration Enforcing Contracts The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local rst-instance court, and the quality of judicial processes index, evaluating whether each economy has adopted a series of good practices that promote quality and e ciency in the court system. The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to enforce a contract through the The dispute in the case study involves the breach of a sales contract courts (calendar days) between 2 domestic businesses. The case study assumes that the court hears an expert on the quality of the goods in dispute. This distinguishes Time to file and serve the case the case from simple debt enforcement. Time for trial and to obtain the judgment To make the data comparable across economies, Doing Business uses Time to enforce the judgment several assumptions about the case: Cost required to enforce a contract through the (Seller - The dispute concerns a lawful transaction between two businessesPage 53   courts (% of claim) and Buyer), both located in the economy’s largest business city. For 11 SOLAS certificate Company Registration Doing Business 2018 Cambodia Enforcing Contracts The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local rst-instance court, and the quality of judicial processes index, evaluating whether each economy has adopted a series of good practices that promote quality and e ciency in the court system. The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to enforce a contract through the The dispute in the case study involves the breach of a sales contract courts (calendar days) between 2 domestic businesses. The case study assumes that the court hears an expert on the quality of the goods in dispute. This distinguishes Time to file and serve the case the case from simple debt enforcement. Time for trial and to obtain the judgment To make the data comparable across economies, Doing Business uses Time to enforce the judgment several assumptions about the case: Cost required to enforce a contract through the - The dispute concerns a lawful transaction between two businesses (Seller courts (% of claim) and Buyer), both located in the economy’s largest business city. For 11 Attorney fees economies the data are also collected for the second largest business city. - The buyer orders custom-made goods, then fails to pay. Court fees - The value of the dispute is 200% of the income per capita or the Enforcement fees equivalent in local currency of USD 5,000, whichever is greater. Quality of judicial processes index (0-18) - The seller sues the buyer before the court with jurisdiction over commercial cases worth 200% of income per capita or $5,000. Court structure and proceedings (-1-5) - The seller requests a pretrial attachment to secure the claim. Case management (0-6) - The dispute on the quality of the goods requires an expert opinion. Court automation (0-4) - The judge decides in favor of the seller; there is no appeal. Alternative dispute resolution (0-3) - The seller enforces the judgment through a public sale of the buyer’s movable assets. Standardized Case Claim value KHR 20,801,496.00 Court name Phnom Penh Municipal Court of First Instance City Covered Phnom Penh East Asia & OECD high Indicator Cambodia Pacific income Overall Best Performer Time (days) 483 565.7 577.8 164.00 (Singapore) Cost (% of claim value) 103.4 47.3 21.5 9.00 (Iceland) Quality of judicial processes index (0-18) 5.0 7.9 11.0 15.50 (Australia) Figure – Enforcing Contracts in Cambodia and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 66.61: Malaysia (Rank: 44) 56.22: Lao PDR (Rank: 97) 53.09: Regional Average (East Asia & Pacific) Page 54   of judicial processes Quality Business Doing index (0-18) 2018 Cambodia 5.0 7.9 11.0 15.50 (Australia) Figure – Enforcing Contracts in Cambodia and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 66.61: Malaysia (Rank: 44) 56.22: Lao PDR (Rank: 97) 53.09: Regional Average (East Asia & Pacific) 47.23: Indonesia (Rank: 145) 45.96: Philippines (Rank: 149) 32.67: Cambodia (Rank: 179) Note: The ranking of economies on the ease of enforcing contracts is determined by sorting their distance to frontier scores for enforcing contracts. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Enforcing Contracts in Cambodia – Time and Cost Time Cost 1200 120 103.4 1000 962 100 Cost (% of claim value) 800 70.3 80 Time (days) 565.7 577.8 600 60 483 47.3 443 403.2 425 37.3 400 31.6 31.0 40 21.5 200 20 0 0 Cambodia East Asia & Indonesia Lao PDR Malaysia OECD high income Philippines Pacific Figure – Enforcing Contracts in Cambodia and comparator economies – Measure of Quality Cambodia 2.5 1 0 1.5 Indonesia 2.5 1.8 0.6 3 Lao PDR 2.5 2 0 1 Malaysia 2.5 3 2.5 4 Philippines 2.5 1.5 0.5 3 OECD high income 2.5 2.9 2 3.6 East Asia & Pacific 2.2 2 1.3 3 0 2 4 6 8 10 12 Page 55   14 Cambodia East Asia & Indonesia Lao PDR Malaysia OECD high income Philippines Pacific Doing Business 2018 Cambodia Figure – Enforcing Contracts in Cambodia and comparator economies – Measure of Quality Cambodia 2.5 1 0 1.5 Indonesia 2.5 1.8 0.6 3 Lao PDR 2.5 2 0 1 Malaysia 2.5 3 2.5 4 Philippines 2.5 1.5 0.5 3 OECD high income 2.5 2.9 2 3.6 East Asia & Pacific 2.2 2 1.3 3 0 2 4 6 8 10 12 14 Sub-Indicator Score Alternative dispute resolution (0­3) Case management (0­6) Court automation (0­4) Court structure and proceedings (­1­5) Details – Enforcing Contracts in Cambodia Indicator Time (days) 483 Filing and service 63 Trial and judgment 250 Enforcement of judgment 170 Cost (% of claim value) 103.4 Attorney fees 95.8 Court fees 1 Enforcement fees 6.6 Quality of judicial processes index (0-18) 5.0 Court structure and proceedings (-1-5) 1.5 Case management (0-6) 1.0 Court automation (0-4) 0.0 Alternative dispute resolution (0-3) 2.5 Details – Enforcing Contracts in Cambodia – Measure of Quality Page 56   Alternative dispute resolution (0-3) 2.5 Doing Business 2018 Cambodia Details – Enforcing Contracts in Cambodia – Measure of Quality Answer Score Quality of judicial processes index (0-18) 5.0 Court structure and proceedings (-1-5) 1.5 1. Is there a court or division of a court dedicated solely to hearing commercial cases? No 0.0 2. Small claims court 0.0 2.a. Is there a small claims court or a fast-track procedure for small claims? No 2.b. If yes, is self-representation allowed? n.a. 3. Is pretrial attachment available? Yes 1.0 4. Are new cases assigned randomly to judges? Yes, but manual 0.5 5. Does a woman's testimony carry the same evidentiary weight in court as a man's? Yes 0.0 Case management (0-6) 1.0 1. Time standards 0.0 1.a. Are there laws setting overall time standards for key court events in a civil case? Yes 1.b. If yes, are the time standards set for at least three court events? No 1.c. Are these time standards respected in more than 50% of cases? Yes 2. Adjournments 0.0 2.a. Does the law regulate the maximum number of adjournments that can be No granted? 2.b. Are adjournments limited to unforeseen and exceptional circumstances? Yes 2.c. If rules on adjournments exist, are they respected in more than 50% of cases? No 3. Can two of the following four reports be generated about the competent court: (i) No 0.0 time to disposition report; (ii) clearance rate report; (iii) age of pending cases report; and (iv) single case progress report? 4. Is a pretrial conference among the case management techniques used before the Yes 1.0 competent court? 5. Are there any electronic case management tools in place within the competent court No 0.0 for use by judges? 6. Are there any electronic case management tools in place within the competent court No 0.0 for use by lawyers? Court automation (0-4) 0.0 1. Can the initial complaint be led electronically through a dedicated platform within No 0.0 the competent court? 2. Is it possible to carry out service of process electronically for claims led before the No 0.0 competent court? Page 57   1. Can the initial complaint be led electronically through a dedicated platform within No 0.0 Businesscourt? the competent Doing 2018 Cambodia 2. Is it possible to carry out service of process electronically for claims led before the No 0.0 competent court? 3. Can court fees be paid electronically within the competent court? No 0.0 4. Publication of judgments 0.0 4.a Are judgments rendered in commercial cases at all levels made available to the No general public through publication in o cial gazettes, in newspapers or on the internet or court website? 4.b. Are judgments rendered in commercial cases at the appellate and supreme No court level made available to the general public through publication in o cial gazettes, in newspapers or on the internet or court website? Alternative dispute resolution (0-3) 2.5 1. Arbitration 1.5 1.a. Is domestic commercial arbitration governed by a consolidated law or Yes consolidated chapter or section of the applicable code of civil procedure encompassing substantially all its aspects? 1.b. Are there any commercial disputes—aside from those that deal with public No order or public policy—that cannot be submitted to arbitration? 1.c. Are valid arbitration clauses or agreements usually enforced by the courts? Yes 2. Mediation/Conciliation 1.0 2.a. Is voluntary mediation or conciliation available? Yes 2.b. Are mediation, conciliation or both governed by a consolidated law or No consolidated chapter or section of the applicable code of civil procedure encompassing substantially all their aspects? 2.c. Are there nancial incentives for parties to attempt mediation or conciliation (i.e., Yes if mediation or conciliation is successful, a refund of court ling fees, income tax credits or the like)? Resolving Insolvency Doing Business studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to calculate the recovery rate, which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or debt enforcement (foreclosure or receivership) proceedings. To determine the present value of the amount recovered by creditors, Doing Business uses the lending rates from the International Monetary Fund, supplemented with data from central banks and the Economist Intelligence Unit. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to recover debt (years) To make the data on the time, cost and outcome comparable across economies, several assumptions about the business and the case are Measured in calendar years used: Appeals and requests for extension are included - A hotel located in the largest city (or cities) has 201 employees and 50 Cost required to recover debt (% of debtor’s estate) suppliers. The hotel experiences nancial di culties. Page 58   Measured as percentage of estate value - The value of the hotel is 100% of the income per capita or the equivalent if mediation or conciliation is successful, a refund of court ling fees, income tax credits or the like)? Doing Business 2018 Cambodia Resolving Insolvency Doing Business studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to calculate the recovery rate, which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or debt enforcement (foreclosure or receivership) proceedings. To determine the present value of the amount recovered by creditors, Doing Business uses the lending rates from the International Monetary Fund, supplemented with data from central banks and the Economist Intelligence Unit. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to recover debt (years) To make the data on the time, cost and outcome comparable across economies, several assumptions about the business and the case are Measured in calendar years used: Appeals and requests for extension are included - A hotel located in the largest city (or cities) has 201 employees and 50 Cost required to recover debt (% of debtor’s estate) suppliers. The hotel experiences nancial di culties. Measured as percentage of estate value - The value of the hotel is 100% of the income per capita or the equivalent Court fees in local currency of USD 200,000, whichever is greater. - The hotel has a loan from a domestic bank, secured by a mortgage over Fees of insolvency administrators the hotel’s real estate. The hotel cannot pay back the loan, but makes Lawyers’ fees enough money to operate otherwise. Assessors’ and auctioneers’ fees In addition, Doing Business evaluates the adequacy and integrity of the Other related fees existing legal framework applicable to liquidation and reorganization Outcome proceedings through the strength of insolvency framework index. The index tests whether economies adopted internationally accepted good Whether business continues operating as a going practices in four areas: commencement of proceedings, management of concern or business assets are sold piecemeal debtor’s assets, reorganization proceedings and creditor participation. Recovery rate for creditors Measures the cents on the dollar recovered by secured creditors Outcome for the business (survival or not) determines the maximum value that can be recovered Official costs of the insolvency proceedings are deducted Depreciation of furniture is taken into account Present value of debt recovered Strength of insolvency framework index (0- 16) Sum of the scores of four component indices: Commencement of proceedings index (0-3) Management of debtor’s assets index (0-6) Reorganization proceedings index (0-3) Creditor participation index (0-4) East Asia & OECD high Indicator Cambodia Pacific income Overall Best Performer Recovery rate (cents on the dollar) 14.2 35.4 71.2 93.1 (Norway) Time (years) 6.0 2.6 1.7 0.4 (Ireland) Page 59   Cost (% of estate) 18.0 20.6 9.1 1.00 (Norway) Creditor participation index (0-4) Doing Business 2018 Cambodia East Asia & OECD high Indicator Cambodia Pacific income Overall Best Performer Recovery rate (cents on the dollar) 14.2 35.4 71.2 93.1 (Norway) Time (years) 6.0 2.6 1.7 0.4 (Ireland) Cost (% of estate) 18.0 20.6 9.1 1.00 (Norway) Outcome (0 as piecemeal sale and 1 as going 0 .. .. .. concern) Strength of insolvency framework index (0-16) 13.0 7.0 12.1 15.00 (6 Economies) Figure – Resolving Insolvency in Cambodia and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 67.61: Indonesia (Rank: 38) 62.51: Malaysia (Rank: 46) 55.22: Philippines (Rank: 59) 48.25: Cambodia (Rank: 74) 40.78: Regional Average (East Asia & Pacific) 0.00: Lao PDR (Rank: 168) Note: The ranking of economies on the ease of resolving insolvency is determined by sorting their distance to frontier scores for resolving insolvency. These scores are the simple average of the distance to frontier scores for the recovery rate and the strength of insolvency framework index. Figure – Resolving Insolvency in Cambodia – Time and Cost Time Cost 7 32.0 35 6.0 6 30 5 21.6 25 Cost (% of estate) Time (years) 20.6 4 18.0 20 3 2.6 2.7 15 10.0 9.1 2 1.7 10 1.1 1.0 1 5 0 0 Cambodia East Asia & Indonesia no practice Malaysia OECD high income Philippines Pacific Lao PDR Figure – Resolving Insolvency in Cambodia and comparator economies – Measure of Quality Cambodia 4 3 3 3 Page 60   Indonesia 5 3 2 0.5 Cambodia East Asia & Indonesia no practice Malaysia OECD high income Philippines Pacific Lao PDR Doing Business 2018 Cambodia Figure – Resolving Insolvency in Cambodia and comparator economies – Measure of Quality Cambodia 4 3 3 3 Indonesia 5 3 2 0.5 Lao PDR 2 2 0 0.5 Malaysia 2 2 2 0 Philippines 5.5 2.5 3 3 OECD high income 5.4 2.8 2.3 1.9 East Asia & Pacific 3.7 2.3 1.2 1 0 2 4 6 8 10 12 14 16 Sub-Indicator Score Management of debtor's assets index (0­6) Commencement of proceedings index (0­3) Creditor participation index (0­4) Reorganization proceedings index (0­3) Figure – Resolving Insolvency in Cambodia and comparator economies – Recovery Rate Recovery Rate (cents on the dollar) 90 81.3 80 70 64.7 60 50 40 35.4 30 21.3 20 14.2 10 0.0 0 Cambodia Indonesia Lao PDR Malaysia Philippines East Asia & Pacific Details – Resolving Insolvency in Cambodia Indicator Answer Explanation Proceeding foreclosure BizBank would initiate foreclosing proceedings to avail itself of his security right by filing an application to the Court of First Instance. The Court invites the parties to negotiate, in the preparatory meeting. Because Mirage cannot repay, the court will rule in favor of BizBank. To enforce the judgment, a real estate company will assess the value of the property; then the sale will be announced. Other creditors, particularly the workers, may file claims. The sale will be organized and if no buyer is found, another auction will be needed. Outcome piecemeal sale The hotel will stop operating and Mirage assets will be sold piecemeal either through a public sale. Time (in years) 6.0 A foreclosure procedure will approximately take 6 years in total. This delay is largely due to judicial inefficiency. Page 61   Cost (% of 18.0 The costs associated with the case would amount to approximately 18% of the value of the Cambodia Indonesia Lao PDR Malaysia Philippines East Asia & Pacific Doing Business 2018 Cambodia Details – Resolving Insolvency in Cambodia Indicator Answer Explanation Proceeding foreclosure BizBank would initiate foreclosing proceedings to avail itself of his security right by filing an application to the Court of First Instance. The Court invites the parties to negotiate, in the preparatory meeting. Because Mirage cannot repay, the court will rule in favor of BizBank. To enforce the judgment, a real estate company will assess the value of the property; then the sale will be announced. Other creditors, particularly the workers, may file claims. The sale will be organized and if no buyer is found, another auction will be needed. Outcome piecemeal sale The hotel will stop operating and Mirage assets will be sold piecemeal either through a public sale. Time (in years) 6.0 A foreclosure procedure will approximately take 6 years in total. This delay is largely due to judicial inefficiency. Cost (% of 18.0 The costs associated with the case would amount to approximately 18% of the value of the estate) debtor's estate. Cost incurred during the entire insolvency process mainly include attorneys' fees (10%), court fees (1%), and enforcement fees (7%), which include fees of auctioneers, publication costs, the real estate evaluation. Recovery rate (cents on the 14.2 dollar) Details – Resolving Insolvency in Cambodia – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 13.0 Commencement of proceedings index (0-3) 3.0 What procedures are available to a DEBTOR when commencing insolvency (a) Debtor may 1.0 proceedings? le for both liquidation and reorganization Does the insolvency framework allow a CREDITOR to le for insolvency of the debtor? (a) Yes, a creditor 1.0 may le for both liquidation and reorganization What basis for commencement of the insolvency proceedings is allowed under the (a) Debtor is 1.0 insolvency framework? generally unable to pay its debts as they mature Management of debtor's assets index (0-6) 4.0 Does the insolvency framework allow the continuation of contracts supplying essential Yes 1.0 goods and services to the debtor? Does the insolvency framework allow the rejection by the debtor of overly burdensome Yes 1.0 contracts? Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0 Page 62   dollar) Doing Business 2018 Cambodia Details – Resolving Insolvency in Cambodia – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 13.0 Commencement of proceedings index (0-3) 3.0 What procedures are available to a DEBTOR when commencing insolvency (a) Debtor may 1.0 proceedings? le for both liquidation and reorganization Does the insolvency framework allow a CREDITOR to le for insolvency of the debtor? (a) Yes, a creditor 1.0 may le for both liquidation and reorganization What basis for commencement of the insolvency proceedings is allowed under the (a) Debtor is 1.0 insolvency framework? generally unable to pay its debts as they mature Management of debtor's assets index (0-6) 4.0 Does the insolvency framework allow the continuation of contracts supplying essential Yes 1.0 goods and services to the debtor? Does the insolvency framework allow the rejection by the debtor of overly burdensome Yes 1.0 contracts? Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0 Does the insolvency framework allow avoidance of undervalued transactions? Yes 1.0 Does the insolvency framework provide for the possibility of the debtor obtaining credit No 0.0 after commencement of insolvency proceedings? Does the insolvency framework assign priority to post-commencement credit? (c) No priority is 0.0 assigned to post- commencement creditors Reorganization proceedings index (0-3) 3.0 Which creditors vote on the proposed reorganization plan? (b) Only creditors 1.0 whose rights are a ected by the proposed plan Does the insolvency framework require that dissenting creditors in reorganization Yes 1.0 receive at least as much as what they would obtain in a liquidation? Are the creditors devided into classes for the purposes of voting on the reorganization Yes 1.0 plan, does each class vote separately and are creditors in the same class treated equally? Creditor participation index (0-4) 3.0 Does the insolvency framework require approval by the creditors for selection or No 0.0 Page 63   plan, does each class vote separately and are creditors in the same class treated equally? Doing Business 2018 Cambodia Creditor participation index (0-4) 3.0 Does the insolvency framework require approval by the creditors for selection or No 0.0 appointment of the insolvency representative? Does the insolvency framework require approval by the creditors for sale of substantial Yes 1.0 assets of the debtor? Does the insolvency framework provide that a creditor has the right to request Yes 1.0 information from the insolvency representative? Does the insolvency framework provide that a creditor has the right to object to Yes 1.0 decisions accepting or rejecting creditors' claims? Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”. Labor Market Regulation Doing Business presents the data for the labor market regulation indicators in an annex. The report does not present rankings of economies on these indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business. Detailed data collected on labor market regulation are available on the Doing Business website (http://www.doingbusiness.org/data/exploretopics/labor-market-regulation). The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Hiring To make the data comparable across economies, several assumptions (i) whether xed-term contracts are prohibited for about the worker and the business are used. permanent tasks; (ii) maximum cumulative duration of xed-term contracts; (iii) length of the The worker: probationary period; (iv) minimum wage. - Is a cashier in a supermarket or grocery store, age 19, with one year of work experience. Working hours - Is a full-time employee. (i) maximum number of working days allowed per - Is not a member of the labor union, unless membership is mandatory. week; (ii) premiums for work: at night, on a weekly rest day and overtime; (iii) whether there are The business: restrictions on work at night, work on a weekly rest - Is a limited liability company (or the equivalent in the economy). day and for overtime work; (iv) whether nonpregnant - Operates a supermarket or grocery store in the economy’s largest and nonnursing women can work same night hours business city. For 11 economies the data are also collected for the second as men; (v) length of paid annual leave. largest business city. - Has 60 employees. Redundancy rules - Is subject to collective bargaining agreements if such agreements cover (i) whether redundancy can be basis for terminating more than 50% of the food retail sector and they apply even to rms that workers; (ii) whether employer needs to notify are not party to them. and/or get approval from third party to terminate 1 - Abides by every law and regulation but does not grant workers more redundant worker and a group of 9 redundant bene ts than those mandated by law, regulation or (if applicable) collective workers; (iii) whether law requires employer to bargaining agreements. reassign or retrain a worker before making worker redundant; (iv) whether priority rules apply for redundancies and reemployment. Redundancy cost (i) notice period for redundancy dismissal; (ii) severance payments due when terminating a redundant worker. Page 64   Job quality the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”. Doing Business 2018 Cambodia Labor Market Regulation Doing Business presents the data for the labor market regulation indicators in an annex. The report does not present rankings of economies on these indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business. Detailed data collected on labor market regulation are available on the Doing Business website (http://www.doingbusiness.org/data/exploretopics/labor-market-regulation). The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Hiring To make the data comparable across economies, several assumptions (i) whether xed-term contracts are prohibited for about the worker and the business are used. permanent tasks; (ii) maximum cumulative duration of xed-term contracts; (iii) length of the The worker: probationary period; (iv) minimum wage. - Is a cashier in a supermarket or grocery store, age 19, with one year of work experience. Working hours - Is a full-time employee. (i) maximum number of working days allowed per - Is not a member of the labor union, unless membership is mandatory. week; (ii) premiums for work: at night, on a weekly rest day and overtime; (iii) whether there are The business: restrictions on work at night, work on a weekly rest - Is a limited liability company (or the equivalent in the economy). day and for overtime work; (iv) whether nonpregnant - Operates a supermarket or grocery store in the economy’s largest and nonnursing women can work same night hours business city. For 11 economies the data are also collected for the second as men; (v) length of paid annual leave. largest business city. - Has 60 employees. Redundancy rules - Is subject to collective bargaining agreements if such agreements cover (i) whether redundancy can be basis for terminating more than 50% of the food retail sector and they apply even to rms that workers; (ii) whether employer needs to notify are not party to them. and/or get approval from third party to terminate 1 - Abides by every law and regulation but does not grant workers more redundant worker and a group of 9 redundant bene ts than those mandated by law, regulation or (if applicable) collective workers; (iii) whether law requires employer to bargaining agreements. reassign or retrain a worker before making worker redundant; (iv) whether priority rules apply for redundancies and reemployment. Redundancy cost (i) notice period for redundancy dismissal; (ii) severance payments due when terminating a redundant worker. Job quality (i) whether law mandates equal remuneration for work of equal value and nondiscrimination based on gender in hiring; (ii) whether law mandates paid or unpaid maternity leave; (iii) length of paid maternity leave; (iv) whether employees on maternity leave receive 100% of wages; (v) availability of ve fully paid days of sick leave a year; (vi) eligibility requirements for unemployment protection. Details – Labor Market Regulation in Cambodia Answer Hiring Page 65   Fixed-term contracts prohibited for permanent tasks? No days of sick leave a year; (vi) eligibility requirements for unemployment protection. Doing Business 2018 Cambodia Details – Labor Market Regulation in Cambodia Answer Hiring Fixed-term contracts prohibited for permanent tasks? No Maximum length of a single xed-term contract (months) 24.0 Maximum length of xed-term contracts, including renewals (months) 24.0 Minimum wage applicable to the worker assumed in the case study (US$/month) 0.0 Ratio of minimum wage to value added per worker 0.0 Maximum length of probationary period (months) 1.0 Working hours Standard workday 8.0 Maximum number of working days per week 6.0 Premium for night work (% of hourly pay) 30.0 Premium for work on weekly rest day (% of hourly pay) 0.0 Premium for overtime work (% of hourly pay) 50.0 Restrictions on night work? No Whether nonpregnant and nonnursing women can work the same night hours as men Yes Restrictions on weekly holiday? No Restrictions on overtime work? No Paid annual leave for a worker with 1 year of tenure (working days) 18.0 Paid annual leave for a worker with 5 years of tenure (working days) 19.0 Paid annual leave for a worker with 10 years of tenure (working days) 21.0 Paid annual leave (average for workers with 1, 5 and 10 years of tenure, in working days) 19.3 Redundancy rules Dismissal due to redundancy allowed by law? Yes Third-party noti cation if one worker is dismissed? No Third-party approval if one worker is dismissed? No Third-party noti cation if nine workers are dismissed? Yes Third-party approval if nine workers are dismissed? No Retraining or reassignment obligation before redundancy? No Page 66   Third-party Doing approval Business 2018 if nine workers are dismissed? Cambodia No Retraining or reassignment obligation before redundancy? No Priority rules for redundancies? Yes Priority rules for reemployment? Yes Redundancy cost Notice period for redundancy dismissal for a worker with 1 year of tenure 2.1 Notice period for redundancy dismissal for a worker with 5 years of tenure 8.7 Notice period for redundancy dismissal for a worker with 10 years of tenure 13.0 Notice period for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 7.9 Severance pay for redundancy dismissal for a worker with 1 year of tenure 2.1 Severance pay for redundancy dismissal for a worker with 5 years of tenure 10.7 Severance pay for redundancy dismissal for a worker with 10 years of tenure 21.4 Severance pay for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 11.4 Job quality Equal remuneration for work of equal value? No Gender nondiscrimination in hiring? Yes Paid or unpaid maternity leave mandated by law? Yes Minimum length of maternity leave (calendar days)? 90.0 Receive 100% of wages on maternity leave? No Five fully paid days of sick leave a year? No Unemployment protection after one year of employment? No Minimum contribution period for unemployment protection (months)? n.a. Business Reforms in Cambodia In the year ending June 1, 2017, 119 economies implemented 264 total reforms across the di erent areas measured by Doing Business. Doing Business has recorded more than 2,900 regulatory reforms making it easier to do business since 2004. Reforms inspired by Doing Business have been implemented by economies in all regions. The following are the reforms for Cambodia implemented since Doing Business 2008. = Doing Business reform making it easier to do business. = Change making it more di cult to do business. DB2017 Starting a Business: Cambodia made starting a business more di cult by increasing the time required to register and by requiring companies to submit evidence of capital deposit after registration. Getting Credit: In Cambodia the credit bureau started to provide credit scores to banks and nancial institutions, improving access to credit information. DB2016 Page 67   Starting a Business: Cambodia made starting a business easier by simplifying company name checks, streamlining tax Minimum contribution period for unemployment protection (months)? n.a. Doing Business 2018 Cambodia Business Reforms in Cambodia In the year ending June 1, 2017, 119 economies implemented 264 total reforms across the di erent areas measured by Doing Business. Doing Business has recorded more than 2,900 regulatory reforms making it easier to do business since 2004. Reforms inspired by Doing Business have been implemented by economies in all regions. The following are the reforms for Cambodia implemented since Doing Business 2008. = Doing Business reform making it easier to do business. = Change making it more di cult to do business. DB2017 Starting a Business: Cambodia made starting a business more di cult by increasing the time required to register and by requiring companies to submit evidence of capital deposit after registration. Getting Credit: In Cambodia the credit bureau started to provide credit scores to banks and nancial institutions, improving access to credit information. DB2016 Starting a Business: Cambodia made starting a business easier by simplifying company name checks, streamlining tax registration and eliminating the requirement to publish information on the new company’s incorporation in the o cial gazette. Getting Electricity: Cambodia reduced the average frequency and duration of power outages experienced by a customer over the course of a year in Phnom Penh by increasing power generation capacity. DB2014 Starting a Business: Cambodia made starting a business more di cult by introducing a requirement for a company name check at the Department of Intellectual Property and by increasing the costs both for getting registration documents approved and stamped by the Phnom Penh Tax Department and for completing incorporation with the commercial registrar. DB2013 Getting Credit: Cambodia improved access to credit information by establishing its rst private credit bureau. Paying Taxes: Cambodia introduced a new tax on immovable property. DB2012 Getting Credit: Cambodia strengthened its credit information system through a new regulation allowing credit bureaus to collect and distribute positive as well as negative credit information. DB2011 Trading across Borders: Cambodia eliminated preshipment inspections, reducing the time and number of documents required for importing and exporting. DB2010 Paying Taxes: Cambodia made paying taxes more costly for companies by introducing a social security contribution based on employees’ average monthly wage. DB2009 Getting Credit: Cambodia adopted its rst secured transactions law—enabling the use of movable property as collateral and ensuring that secured creditors’ claims have priority in case of debtor default—and launched an online uni ed collateral registry. Resolving Insolvency: Cambodia adopted its rst law regulating the bankruptcy of private enterprises (the 2007 Bankruptcy Law), which introduced a reorganization procedure to restructure insolvent companies. Page 68   Resolving Insolvency: Cambodia adopted its rst law regulating the bankruptcy of private enterprises (the 2007 Bankruptcy Law), which Doingintroduced Business a reorganization 2018 Cambodia procedure to restructure insolvent companies. Page 69