1. AUSTRALIA | CAMBODIA | INDONESIA | LAOS | MALAYSIA | MYANMAR | SINGAPORE | THAILAND | VIETNAM

2. AUSTRALIA | CAMBODIA | INDONESIA | MALAYSIA | MYANMAR | SINGAPORE | THAILAND | VIETNAM Managing Risk (Cambodia) Structuring and Disputes Matthew Rendall SokSiphana&associates (a member of ZICOlaw) 19 February 2014

3. © ZICOlaw. All Rights Reserved. 3 Acquisition structuring to lessen risk  Establishing a Co.  100% foreign ownership is permitted  Target Co  DD very important but somewhat difficult due to current practices of government institutions  So, wherever possible establish a New Co  QIP Co.  Projects registered with CDC for investment privileges.  Incoming buyer is made liable for all past and present obligations of the outgoing owners  Transfer project rather than buy the company.

4. ..continued  JV Partner Co.  Not required by law (except with regard to land ownership)  if land is required either  Long term lease  Land holding company (with different class shares and forward lease to separate 100% owned operating company)  Use of nominees  No advantage at law  Where local knowledge is required then hire rather than JV © ZICOlaw. All Rights Reserved. 4

5. Dispute Resolution Three venues  Courts  Poor capacity of judges  Lack of training/understanding of complex issues  Corruption issues  Political  Financial  National Arbitration Center  Not yet established  Lack of foreign arbitrators  Arbitrators all inexperienced.  Labor Arbitration council  Only labor disputes © ZICOlaw. All Rights Reserved. 5

6. Foreign Arbitration  Permitted under Cambodian law  Signatory to the New York Convention  Recognized under Cambodian Civil Code  Preferred choice of foreign investors  Although Government tends not to allow foreign dispute resolution clauses in its contracts / licenses  Enforcement  Requires Cambodian court  Largely untested  Limited experience indicates that courts may revisit issues  not unconditionally issue enforcement orders  refuse to recognize foreign arbitration clause in contracts  Caltex case © ZICOlaw. All Rights Reserved. 6

7. Most importantly… don‘t avoid the rules..  Despite conventional wisdom Cambodia is a country of laws  Laws will be enforced against foreign investors  Avoid following advice of local agents/consultants who suggest to 'cut corners’ or ignore certain requirements (on the basis that local investors do so or certain laws are not implemented)  This is the PRIMARY reason for investments failing or running into problems © ZICOlaw. All Rights Reserved. 7

8. © ZICOlaw. All Rights Reserved. 8 Contact Details Matthew Rendall Partner Tel: +855 23 999 878 Email : matthew.rendall@zicolaw.com SokSiphana&associates a member of ZICOlaw No 45 Street 355z First Floor Sangkat Boeung Kak 1 Khan Tuol Kork Phnom Penh 12151 Kingdom of Cambodia.

9. www.zicolaw.com AUSTRALIA | CAMBODIA | INDONEIA | LAOS | MALAYSIA | MYANMAR | SINGAPORE | THAILAND | VIETNAM