Property ownership update – Khan Daun Penh


This week has been an interesting one for real estate in Phnom Penh, especially if you are a foreigner who owns or was planning to own a soft title property in your own name in the central area of Khan Daun Penh. Khan Daun Penh encompasses the area from the Riverside district West through to Norodom Boulevard.

Khan Daun Penh officials announced that as of June 13th 2016, the Sangkats will no longer transfer soft titled property into a foreigner’s name – essentially they are now enforcing a law that has always been in existence but previously allowed individual Sangkat’s to enforce it at their discretion. This follows on from a similar change made in Khan 7 Makara late last year which saw a flurry of activity as foreigners who held property in their own name sought advice and solutions to ensure that their property was secure.


The Khan’s enforcement follows a notification letter on 25th May issued by the Director of the Phnom Penh Department of Land Management, Urban Planning and Construction instructing the Chiefs of all twelve Khans in Phnom Penh City to not process any titles in a foreign buyers name unless the specific conditions for a co-owned building are met. This of course is referring to strata title condominiums and does not apply to soft title properties built before 2010.Soft Title Nominee

We haveSoft-Title always strongly recommended our foreign clients follow the law governing property ownership and to use Nominee or Land Holding Company services when purchasing a Soft or Hard title. Despite the restrictive law on foreign property ownership there are a number of tried and tested mechanisms, the most effective for soft titled property being the nominee structure.

At IPS Cambodia 95% of all our soft titled property purchased by foreign clients are conducted through this system.

Under the Nominee structure, the foreign buyer engages a Khmer national (usually a friend or colleague or professional third party) to hold their property in the nominee’s name, thus ensuring the title transfer is fully legal and Cambodian law is followed. This relationship is then secured through the use of nominee security contracts (contracts between the foreign buyer and nominee) which places a number of restrictions on the nominee including the ability to sell, transfer or move the property to any other third party without permission of the Foreign Buyer.

The nominee structure is economical, effective and fast. If you would like more information on the process please come into IPS Cambodia and we will explain the process in detail.

Grant Fitzgerald is the Country Director for IPS Cambodia

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