The Phnom Penh Post has reported on a new law that could allow foreign ownership of casinos. At present foreign property ownership is banned and in consequence has led to foreign investment often having been made under the name of Cambodian citizens, which in turn has led to legal problems when foreigners claim their assets have been stolen.

The new law, passed by 85 to 11 votes in the National Assembly, now needs approval in the Senate and from King Norodom Sihamoni, both considered to be a formality. However, foreign ownership of land – including the ground floor of property – will remain prohibited. Also foreign ownership of property within 30 kilometres of Cambodia’s borders is not permitted. A restriction to limit foreign ownership of a building to 49% has been removed under the new law.

Opposition politicians are widely in support of the new law although a spokesman for the Sam Rainsy Party said that the Article allowing foreign ownership of property in the special economic zones could result in casinos being run by foreigners. In 1999 the first border casino was built in Poipet on the border with Thailand. This was quickly followed by others and then the opening of casinos in Bavet on the border with Vietnam. Most of the money to build these casinos came from investors in Thailand, but also from Malaysia, Indonesia, Taiwan and China.

Frequently ownership of the casinos remains obscure. In 2003 the Far Eastern Economic Review reported that the casinos were run by ‘the usual triumvirate of politicians, military officers and businessmen’, with Cambodian army officers apparently acquiring title deeds and moving inhabitants off the land. Since then Cambodia has increased control over casinos and in 2008 ordered the removal of all slot machine businesses except those in hotels certified by the Ministry of Tourism.

In January this year the 32nd gambling facility licensed by the government opened – the Top Diamond Casino in Bavet - followed by the Titan King casino in February. The government has licensed 19 areas as special economic zones but so far only six are in operation. Cambodia is hoping to court international investment by relaxing laws on property ownership by foreigners in a bid to counter property prices that have fallen as much as 40% in the wake of the global recession. (E-04.06.10)

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