Legal Document

Title: Directive No. 365 on Procedures for Delay, Postponement, Suspension, or Termination of Company Investment Activity
Type: Directive
Issuing Agency: Council for the Development of Cambodia
Responsible Agency: Council for the Development of Cambodia
Issuing Date: 07-03-2011

 

UNOFFICAL TRANSLATION

 

Kingdom of Cambodia

Nation Religion King

Council for the Development of Cambodia

No. 365/11 ….

Phnom Penh, 07 March 2011

Directive

On

Procedures for Delay, Postponement, Suspension,

or Termination of Company Investment Activity 

 

Pursuant to the Investment Law of the Kingdom of Cambodia, the Council for the Development of Cambodia wishes to inform the investors – who have not yet and who have been implementing the qualified investment project (QIP) but intend to delay, postpone, or suspend the project temporarily or intend to terminate the investment activities – about the procedures and application to be implemented as follows:

 

1.         Request for delay of implementation by the investor who has not yet implemented the qualified investment project (QIP)    

           

After receiving all documents issued by relevant institutions, including the Certificate of Registration, the investor shall proceed the implementation of the project in accordance with the outline raised by the company in question in its report of economic possibility officially filed at the Council for the Development of Cambodia.

   

            After 6 (six) months (except different case specified in the lease agreement of land economic concession with the state or other agreements of various concessions …etc.) if the investment project is not implemented, the investor shall make a request for the delay of the implementation to the Council for the Development of Cambodia by stating valid reason with sufficient supporting evidences about the delay of the implementation, so that the Council for the Development of Cambodia can check the necessity and other actions for issuing a delay letter at the investor’s actual request or make intervention to help the investor solve any relevant problem that is the obstacle or barrier.

 

            The delay cannot be allowed more than 6 (six) months. In the case that the delay is over the first determined time and the investor still cannot begin the investment activity, the Council for the Development of Cambodia will check another request for the second delay based on an appropriate reason, but the third delay will not be allowed. In addition, the company in question will face the revocation of the Certificate of Registration and removal of the project from the CDC’s list.

            The documents required for the request for the project delay are:  

1.         Application form for request for the delay, by specifying valid reason of the failure to implement the project.

2.         Report on raw materials, production equipment, construction materials, import taxes borne by the state (if any)

                3.         Certificate of Registration and company’s statute (copy)

           

            The Council for the Development of Cambodia will make a response to the request for delay of the project within 10 (ten) days at the latest after receiving the request and sufficient documents from the investor.

 

2          Request for temporary postponement or suspension for the investor who has already implemented the qualified investment project (QIP):     

  

            The company shall submit a request to the Council for the Development of Cambodia/Cambodian Investment Board with valid reason and clearly state the duration of the postponement or suspension with the following documents:

1.               Application for postponement or suspension with valid reason.

2.               Certificate of Registration and company’s statute (copy)

3.               Report on items such as raw materials, production equipment, construction materials, import taxes borne by the state.

4.               Guarantee letter for ensuring a proper and appropriate control and keeping of raw materials, production equipment, construction materials as in point 3.

5.               Letter clarifying the measure of solving problem with workers/employees.

 

Upon receiving sufficient documents, the Council for the Development of Cambodia shall inspect the actual situation claimed by the investor in question. The Council for the Development of Cambodia shall response to the postponement or suspension request within 10 working days at the latest. The time permitted for the postponement or suspension shall not exceed 6 months. In the event that the deadline of the first permission has passed and the investor has not yet implemented the project, the Council for the Development of Cambodia will check another request for the second postponement or suspension based on a proper reason, but the third postponement or suspension will not be allowed. In addition, the company in question will face the revocation of the Certificate of Registration and removal of the project from the CDC’s list after the actual inspection by CDC has proved that the company in question could not continue their activities and after the company has provided sufficient documents regarding the clearing of obligations and taxes, including the documents on tax debt clearing (if any). 

 

3.         Request for termination of investor’s QIP

 

Besides the bankruptcy which requires the investor to follow the bankruptcy law, for the request for termination of QIP, the investor, despite outside the court or through the court, shall:

1.               Make a request to GDC

2.               Make all obligation clearing, including worker/employee salaries, tax debt, other private debts, in accordance with the law and regulation on taxation and law on commercial enterprises…etc.  

3.               Clear customs tax and other customs obligations suspended during the import of goods under the tax suspension regime, including the temporary import, import with tax exemption, partial or complete taxes and other imports under the preferential tax regime, in accordance with the law and customs regulation in effect.

 

The request for termination of QIP made to the CDC / Cambodian Investment Board shall be coincided with the request for clearing customs tax obligations at the General Department of Customs and Excise and request for clearing taxes at the Administration of Taxation.

            The procedures and application are as follows:

A) Procedures and application for clearing customs tax obligations at the General Department of Customs and Excise:               

 

The company shall submit an application for tax obligation clearing at the General Department of Customs and Excise (Customs Regime Department) at every office hour. In the event that the investor has submitted sufficient and correct documents, the General Department of Customs and Excise will issue a certificate of customs obligation clearing within 7 (seven) days at the latest, counting from the day of having fulfilled customs obligations (as in the sample provided herewith). In case of tardiness, the General Department of Customs and Excise shall give an immediate notice to the Council for the Development of Cambodia by clearly clarifying the reason of the tardiness.

 

B)  Procedures and application for clearing tax obligations at the General Department of Taxation:

 

The investor shall gave a notice in writing to the Administration of Taxation  within 15 days, after the postponement or termination of business activities, for clearing tax obligations by attaching original documents such as patent, certificate of VAT, tax declaration of annual or partial annual income, and notification letter of tax re-determination (last year) and by clearly stating the name of governor, manager, director or legal representative – who has a proper Power of Attorney – and fiscal identification number, current address, and mobile phone number.            

 

After all the above documents have already been fulfilled, the General Department of Taxation will make an audit for tax debt clearing and issuing a letter certifying the tax condition (as attached herewith) within 30 (thirty) working days for the investor.

 

The Council for the Development of Cambodia / Cambodian Investment Board shall issue a declaration on the company name removal and removal of QIP within 10 (ten) working days to the investor after the investor has already submitted the following documents:

-        Certificate of Registration and company’s statute (copy)

-        Decision of company shareholders for project termination    

-        Certificate of customs tax obligation clearing issued by the General Department of Customs and Excise of Cambodia

-        Document clarifying the tax condition issued by the General Department of Taxation

-        Letter clarifying the third party debt condition (workers/employees) which was already cleared “if any”.

 

Upon receiving this directive, the Council for the Development of Cambodia / Cambodian Investment Board, General Department of Customs and Excise of Cambodia, General Department of Taxation, relevant institutions and all investors who have implemented the qualified investment project (QIP) are obliged to cooperate and implement it in an effective way from the date of signing.  

 

Deputy Prime Minister

Minister of Economy and Finance

First Deputy Chair of Council for the Development of Cambodia  

(signed and sealed)

Keat Chhon

CC:

-   Office of the Council of Minister

-   Ministry of Interior

-   Ministry of Foreign Affairs and International Cooperation

-   Ministry of Agriculture, Forestry, and Fisheries

-   Ministry of Commerce

-   Ministry of Industry, Mines and Energy

-   Ministry of Social Affairs, Veteran and Youth Rehabilitation

-   Ministry of Labour and Vocational Training

-   Ministry of Environment

-   Cabinet of Samdech Prime Minister Hun Sen

-   All municipal and provincial halls

-   Cambodia Chamber of Commerce

-   GMAC