Reminder on Foreign Quota Application for Year 2025
The Ministry of Labour and Vocational Training (“MLVT“) issued Notification No. 026/24 dated 11 September 2024, informing owners or directors of companies employing foreign employees that they can apply for foreign quota for year 2025 from 1 September 2024 to 30 November 2024. Such applications can be submitted online through www.fwcms.mlvt.gov.kh.
For companies incorporated after 30 November 2024 that intend to hire foreign employees, the application for foreign quota may be submitted immediately after commencing operations. The permitted ratio for employing local employees to foreign counterparts is 10:1, meaning companies are allowed to employ one foreign employee for every ten local employees. However, it is legally allowed to apply for an extra quota if the demand for foreign employees exceeds this ratio. In such cases, valid justification must be provided. The requests are also subject to MLVT’s approval.
Failure to comply with the above requirements will attract payment of a pecuniary fine equivalent to 61 to 90 days of the base daily wage, or imprisonment for a period of six days to one month, in accordance with Article 369 of the Cambodian Labour Law.
Guidelines on Reinsurance Diversification
On 6 August 2024, the Insurance Regulator of Cambodia issued Guideline No. 041 on Reinsurance Diversification (“Guideline“), aiming to ensure the safety and effectiveness of risk management and risk prevention for insurers.
Pursuant to the Guideline, an insurer shall transfer any risk that exceeds its risk tolerance to a foreign reinsurer in accordance with the conditions specified in the table of the Guideline. In the event that a foreign reinsurer has different credit ratings under different credit rating agencies, the insurer shall apply the lowest credit rating when implementing such table.
In addition, the insurer shall seek approval from the Insurance Regulator of Cambodia on any change or retention of a foreign reinsurer in the event that the credit rating of the foreign reinsurer falls below the minimum level as set out in the Guideline within 10 days after receiving information on the downgrading.
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New Prakas on Management of Advertisement of Alcoholic Products
On 23 July 2024, the Ministry of Information issued Prakas No. 084 on Determination of Formalities, Procedures, and Rules on the Management of Advertisement of Alcoholic Products (“Prakas No. 084“). Prakas No. 084 aims to maintain public order, promote welfare, minimise the impact on the economy and good tradition, and stimulate fair competition in relation to the advertisement of alcoholic products. It applies to any advertisement of alcoholic products that contain more than 3% ethanol in volume in all types, forms, and means of advertisement, including digital means. Prakas No. 084 is in effect from its date of issue.
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Prakas on Rules and Guidelines on Reinsurance
On 12 July 2024, the Non-Bank Financial Service Authority issued Prakas No. 044 on Rules and Guidelines on Reinsurance (“Prakas No. 044“), which aims to ensure the safety and effectiveness of risk management and risk prevention for insurers.
Prakas No. 044 provides guidance for insurers relating to (i) the information to be included in a reinsurance agreement plans; (ii) the preparation of reinsurance guidelines; (iii) reinsurance diversification; and (iv) the reporting obligations of insurers as required by the Insurance Regulator of Cambodia.
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A Newborn National Authority for Alternative Dispute Resolution and its Development in Cambodia
A new government-run dispute settlement institution providing mediation and conciliation services in Cambodia, the National Authority for Alternative Dispute Resolution (“NADR“), was established on 2 November 2023 pursuant to Royal Decree No. NS/RKT/1123/2381 on the Establishment, Organisation, and Functioning of the National Authority for the Alternative Dispute Resolution. NADR was established to create additional alternative dispute resolution mechanisms to enhance the quality, efficiency, and speed of dispute resolution, reduce the backlog of lawsuits in court, and bring the dispute resolution process closer to the local community while upholding social harmony and justice.
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Please note that whilst the information in this Update is correct to the best of our knowledge and belief at the time of writing, it is only intended to provide a general guide to the subject matter and should not be treated as a substitute for specific professional advice
