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New Rules on Associations

New Rules on Associations

March 30, 2018

Commercial Law – Filing Statute of Business Associations

On 07 March 2018, the Ministry of Commerce (“MOC”) issued Prakas No. 088 MOC (“Prakas 088”) regarding filing statutes of business associations.

According to Prakas 088, as part of ongoing obligations after registration with government authorities, all business associations, including foreign chambers of commerce, must file their statute with the MOC. This filing must be done together with certain required documentation including, among others, general meeting minutes to establish the association, specimen of stamp and signature of the association’s president, and registration approvals. Business associations are also required to submit a report of their work activities annually to the provincial/municipal department of commerce where the associations are located. They can also suspend activities by notifying the MOC.

Any change in corporate information of the business associations, such as statute amendment, change of registered address, or change of governing board structure, must be notified to the MOC within 30 days of the change.

To avoid any rejection or loss of legal recognition, all business associations are urged to file their statute, and submit annual reports of their activities, and notify the MOC of any changes as mentioned above.

Labor – Extension of Time to Apply for Foreigner Work Permit Renewal

On 29 March 2018, the Ministry of Labor and Vocational Training (“MLVT”) issued notice No. 012/18, extending their previous deadline of 30 March 2018 to 30 April 2018 to give employers more time to renew their foreigner work permits. To avoid penalty, work permit renewal applications for all foreign employees must be submitted, through the Foreign Worker Centralized Management System (www.fwcms.mlvt.gov.kh), by this date. Failure to timely apply for work permits can result in penalties.

Labor – Foreign Worker Work Permit Inspections

As part of ongoing efforts to strictly enforce work permit requirements, the Ministry of Interior (“MOI”) and the Ministry of Labor and Vocational Training (“MLVT”) issued a joint Prakas, No. 719 Br.K, dated 19 February 2018 (“Joint Prakas 719”), on enforcement of foreign workforce inspections.

According to Joint Prakas 719, a joint inspection team from the MOI and the MLVT may conduct inspections, with or without notice, in relation to work permits of foreign workers. In addition, as part of the inspection, the team may issue written instructions to employers giving them one month to obtain proper work permits.

The original documents that are subject to inspection include, among others:

  • Declaration of employees
  • Declaration of staff movement in and out
  • Quota approval to employ foreign workers
  • Each foreigner’s employment contract in Khmer, as approved by the MLVT
  • Each foreigner’s passport (both original and copies)
  • Each foreigner’s entry visa and the latest visa extension authorizing employment
  • Each foreigner’s work permit and employment card

All employers with foreign employees, lacking proper work permits, may be subject to a fine and punishment according to the Labor Law and the Law on Immigration, which includes possible expulsion of foreign employees from the country. To avoid penalty risk or more serious punishment, we urge all employers to obtain work permits for all of their foreign workers.

If you have any questions regarding the above, or would like us to assist with these matters, please contact Mr. Alex Larkin at [email protected] or Mr. Leung Seng at [email protected]