DRAFT LAW ON GOVERNMENT SECURITIES, dated 4 September 2020
The Draft Law on Government Securities (“Draft Law”) was approved by the Council of Ministers on 4 September 2020, which it would enable the government to utilize a new form of financial instrument, raise domestic financing, diversify the government’s capital portfolio, and primarily cut down external borrowing. This initiative would allow the government to raise funds from domestic level and maximize the benefits of such funds for domestic economic growth. At this stage, the Draft Law only makes institutional entities eligible for the participation of the primary market. We will further elaborate the essential content of the Draft Law below.
The purpose of the Draft Law is to establish a framework to manage the issuance, trading and management of government securities in order to improve the cash-flow management of the government, enhance financial responsiveness to calls for greater economic and social development, strengthen the Cambodian securities and financial markets and support priority and other necessary projects in the public interest. The scope of the Draft Law covers the issuance, trading and management of government securities within and outside of Cambodia.
Under the Draft Law, government securities refer to certificates, bonds and other forms of financial debt instruments that are issued in the name of the Royal Government of Cambodia (“RGC”). However, government securities do not include securities to be issued by public enterprises or other forms of RGC borrowings not covered by the Draft Law.
The issuance of government securities is subject to the financial law and under the authority of the Prime Minister. Only the Minister of the Ministry of Economy and Finance (“Minister”) can issue government securities in accordance with the Law on the Public Financial System or other relevant laws and regulations in force. The Minister can refund, repurchase and settle all government securities that have not reached their date of maturity. All transactions related to the issuance and management of government securities shall be determined by a separate Prakas issued by the Minister. Furthermore, government securities can be issued in local or foreign currency, in Cambodia or overseas as determined by the Minister in a forthcoming Prakas. The offering of government securities shall be the full responsibility of the RGC.
Direct participants in the primary market may be banking and financial institutions duly licensed by the National Bank of Cambodia (“NBC”), securities companies licensed by the Securities and Exchange Commission of Cambodia or other institutions as determined by a relevant Prakas issued by the Minister. Direct participants in the primary market may bid or subscribe government securities for itself or as an agent of another person.
To ensure the efficiency and transparency of the issuance and offering of government securities, the Minister shall determine the issuance/offering methods and mechanisms of the government securities, forms and processes related to management of the to-be-issued government securities. The Minister may determine (1) direct participants and those eligible to participate in the primary market, (2) procedures to record subscribers, (3) deposition of the government securities at any securities depository, (4) listing of government securities for trading on the permitted security exchange, and (5) payment of principal and coupon rate of the government securities and other necessary matters in a separate Prakas.
Furthermore, the right to file a complaint to claim the obligation for the principal and the coupons in respect of the government securities must be enforced within five years from the maturity date. The above-mentioned statutory limitation may be suspended in accordance with the Civil Code and applicable laws. The public asset and state revenue are protected from foreclosure and any other prohibitions.
All government securities trading are subject to the general law of taxation in force and can be entitled to receive the incentives and preferential treatment in accordance with the applicable laws.
It is important to note that the trading, transfer or creation of security interest over the government securities by the NBC or by participants in the interbank or permitted securities market or by other eligible persons and related mechanisms shall be determined by a forthcoming Prakas from the Minister. The rights and responsibilities of the participants above shall also be determined by a Prakas from the Minister.
We will continue to keep you posted when the Draft Law is enacted.
AGRICULTURE
PROCEDURES AND THE SCOPE OF AUTHORITY TO IMPOSE TRANSITIONAL FINES FOR OFFENSES CONCERNING ANIMAL HEALTH AND PRODUCTION, Prakas 343 of the Ministry of Agriculture, Forestry and Fisheries (“MAFF”), dated 10 September 2020
This Prakas outlines procedures and the scope of authority to impose transitional fines for offenses related to animal health and production to enhance the effectiveness of the implementation of the Law on Animal Health and Production dated 28 January 2016 (“LAHP”). This Prakas applies specifically to offenses as determined in Articles 110, 111, 112 and 113 of the LAHP.
General Directorate of Animal Health and Production (“GDAHP”) of the MAFF has the authority to impose transitional fines for all offenses detailed in Articles 110, 111, 112 and 113 of the LAHP whereas the Municipal/Provincial Department of Agriculture, Forestry and Fisheries (“DAFF”) has the authority to impose transitional fines for the relevant offenses enumerated in Points 1 to 5 of Article 110, Points 1, 2 and 8 of Article 111, and Points 1, 4, 5, 6, 9 and 10 of Article 112 of the LAHP.
Transitional fines can only be levied when the offenders admit their offense in writing and agree to pay the fines. However, in the event that the relevant offender did not admit to the offense, the inspector of animal health and production who has been vested with legal powers to act as a judicial police officer must file the case to a competent court in accordance with applicable procedures.
The GDAHP or the DAFF must issue its decision to impose the transitional fines within 10 days at latest from the date on which the offenders admit their offense and agree to pay the transitional fines. The offenders must pay the transitional fines in the amount as stated in the decision of the GDAHP or DAFF within a period not exceeding 10 days from the date of issuance of such decision.
Please note that the specific levels of the fines for offenses detailed in Articles 110, 111, 112 and 113 of the LAHP and the relevant procedures to levy such fines are laid out in this Prakas.
PROCEDURES ON MANAGEMENT OF COMMERCIAL AND FORMULATED VETERINARY MEDICINES AND BIOLOGICAL VETERINARY MATERIALS, Prakas 384 of the MAFF, dated 02 October 2020
This Prakas aims to determine the procedures on the management of veterinary medicines, biological veterinary materials, active substances and all types of components used for commercial purposes, production and formulation. This is to ensure their quality, effectiveness and safety to protect animal welfare, human health, consumers’ benefits and the environment. This Prakas applies to all activities relating to management of veterinary medicines, biological veterinary materials, active substance and all types of components used for commercial purposes, production and formulation in Cambodia.
The procedures for management of veterinary medicines, biological veterinary materials, active substances and all types of components include the following:
- the import, export, transit, production, formulation, re-packaging, storage, distribution, wholesale and retail and transport of veterinary medicines, biological veterinary materials, active substances and all types of components must be implemented in compliance with the provisions of Prakas 414 dated 1 October 2019 on the Procedures for Issuance of Permits and Technical Standards of Import, Export, Transit, Production, Formulation, Re-Packaging, Storage, Distribution, Wholesale and Retail and Transport of Veterinary Medicines;
- any publication, dissemination and advertisement of veterinary medicines, biological veterinary materials, active substances and all types of components are subject to securing prior approval from the GDAHP. An application for such approval must be filed with the GDAHP at least 30 days’ prior to the associated publication, dissemination and advertisement. Following receipt of such approval, dissemination and advertisement of the veterinary medicines, biological veterinary materials, active substances and all types of components can be undertaken in the respective municipality and/or provinces, provided that a notification be given to the respective DAFF for the purposes of cooperation;
- distributors, retailers and wholesalers of veterinary medicines, biological veterinary materials, active substances and all types of components must hold a professional qualification training course completion certificate as a prerequisite to filing an application for a wholesale or retail or distribution permit. For the distributors, such an application must be filed with the GDAHP. For wholesalers and retailers, such applications must be filed with the Office of Animal Health and Production of the respective DAFF; and
- technical persons of enterprises undertaking the import, export, production, formulation and re-packaging of veterinary medicines, biological veterinary materials, active substances and all types of components must fulfill the necessary requirements in order to be duly recognized as qualified technical persons of such enterprises by the GDAHP. This includes holding a medical animal certificate (or an equivalent bachelor degree or higher) as recognized by the MAFF and a professional qualification training course completion certificate as issued by the GDAHP.
In addition to the above, a holder of any permits or certificates in operations relating to veterinary medicines, biological veterinary materials, active substances and all types of components are also subject to other rules and obligations, including, among others: (1) displaying any permit or certificates relating to their respective operations to the public at their enterprise; (2) holding a recording book to record all relevant operations in relation to veterinary medicines, biological veterinary materials, active substances and all types of components in accordance with applicable rules and guidance as determined by the GDAHP; (3) reporting about the danger or impacts of the veterinary medicines, biological veterinary materials, active substances and all types of components; (4) maintaining hygiene within the premises (or surrounding areas) of production and business operations; (5) providing training on safety rules for all relevant operations and safety equipment to relevant operation staff; (6) monitoring and implementing healthcare for relevant staff who undertake direct operations with the veterinary medicines, biological veterinary materials, active substances and all types of components; and (7) determining and implementing the technical standards for the use and maintenance of equipment used with the veterinary medicines, biological veterinary materials, active substances and all types of components.
Should you have any concerns on the impacts of the above new regulations on your business, please contact us at: cambodia@dfdl.com.
The information provided here is for information purposes only and is not intended to constitute legal advice. Legal advice should be obtained from qualified legal counsel for all specific situation.
