What are Economic Land Concessions in Cambodia?

Updated Jan. 12, 2022

Amid the growing economy of Cambodia, economic land concessions (ELCs) have been promoted by the government to further develop the economy. This is because an ELC is only granted if the investor will use the land to promote agriculture. If you’re an investor who is interested in ELCs, then continue reading below.

According to the Land Law enforced in 2001 in Cambodia, ELC allows the lessee, formally known as the “concessionaire", to lease a private state land. This is a long-term lease up to 99 years according to the sub-decree no. 46 of the law. Additionally, this is allowed and granted so the land can be used for the growth of the industrial agriculture of the country. Not only that but granting ELCs to investors helps contribute to increasing local jobs and generating revenues for the state.

Some of what the lessee can do with an approved ELC are the following:

• Establish a facility that will process raw agricultural materials produced locally
• Raise different types of local animals
• Plant different food crops or trees
• An ELC can be used for all of the above as well at the same time.

Investing in an ELC in Cambodia allows you to generate profits that help your business and, at the same time, contribute to the country’s development. However, not all state private lands can be approved for an ELC since they need to meet the following criteria:

1. If the land is classified as a state private land by:
   1. State Land Management
   2. Procedures for Establishing Cadastral Maps
   3. Land Register or Sporadic Registration
2. If the plan to use the land is the same as what has been approved by the Provincial-Municipal State Land Management Committee
3. If social impact and environmental assessments for land use and ELC have been conducted
4. If the land offers solutions for issues with resettlement
5. If the land has had public consultations with the land’s residents and authorities about ELCs or similar projects.

Furthermore, to start an economic land concession project you need to look into two types of proposals:

• Solicited proposal → A solicited proposal is where Cambodian authorities offer a proposal to start an ECL project and they look for investors who want to take up the project. This is easier since a notice and a terms of reference will be sent out that they’re looking for investors.

The terms of reference will include all necessary information about the ELC project, non negotiable terms in the contract, and the criteria they’ll use to evaluate the proposal. Since you have this, you can then fill out an application form to be an investor and if you have the highest proposal, then you will be invited for negotiations.

• Unsolicited proposal → An unsolicited proposal for an ELC project is approved if it’s made on state private land and if it will provide the following:
  • New technology to be used in the project
  • Social land and economic land concessions will be exceptionally tied
  • Exceptional access to export or processing markets will be provided.

Whether you want to get your research done first on investing in Economic Land Concessions in Cambodia or you have a proposal ready, we can help. Make sure to contact us so that we can help you move forward with your investment in Cambodian property !