Govt to cap foreigners’ stakes in properties

via CAAI News Media

Wednesday, 07 April 2010 15:01 Soeun Say and Bejan Siavoshy

GOVERNMENT officials are considering a limit on the amount of property a foreign investor can own, by reinstating a cap that was withdrawn from landmark legislation passed Monday.

Under the Foreigner Property Ownership Law, non-Cambodians can now own residential property, as long as it is not on the ground floor and not within 30 kilometres of an international border.

Nonn Pheany, a spokeswoman for the Ministry of Land Management, Urban Planning and Construction told the Post Tuesday officials were considering a sub-decree that would limit the percentage of property a foreigner can own.

A previous draft of the property law contained a provision that foreigners could not own more than 49 percent of a property, but that cap was dropped from the final draft.

A percentage limitation is “ideal to put in a sub-decree, but that figure could be more or less [than 49 percent] depending on the situation and location of the property”, Nonn Pheany said.

Having a limit in the law itself, which would not be easy to change, would not stimulate foreign investment, a main reason for the law, she added.

“I don’t really know why the 49 percent limitation was put into the law in the first place if the idea ... is to pump in foreign investment,” said Matthew Rendall, of Sciaroni & Associates, a law firm that helped draft the law.

Sub-decrees can easily be changed, and as the number of foreign property investors grows, a percentage can be increased to meet demand, he added.