VLP Legal Press # 22
Establishing a Trust in Cambodia
Trusts are frequently used worldwide for modern asset management and financial planning. In Cambodia, the Law on Trusts (2019) introduced a regulated framework that allows individual/businesses to structure ownership, protect assets and manage investments with transparency and legal certainty. As we close the year, we will explore the basics pertaining to this area.
👤Who Are the Parties in a Trust?
Settlor
The individual or entity who creates the trust and transfers property into it.Trustee
The licensed or approved party (either a trustee company or individual) responsible for holding and administering the trust property under Cambodian Trust Law.Beneficiary
Those entitled to benefit from the trust. The settlor may also be a beneficiary, as designated in the trust deed.
✍🏻How Is a Trust Established?
By Settlor: The settlor establishes the trust via a written trust deed, transferring property to the trustee and defining the trust’s purpose and beneficiaries.
By Law: Certain circumstances under Cambodian statutes may require automatic trust creation.
🔎Types of Trusts Under Cambodian Law
As outlined in the Law on Trusts (2019):
Commercial Trust: Profit-driven, for investments or asset management.
Public Trust: Established for public benefit (e.g. banking, microfinance sector).
Social Trust: Charitable, non-profit, benefiting society at large.
Private/Individual Trust: Created by a natural person for personal or family benefit.
Commercial and private trusts are most relevant for landholding purposes.
⏳Term of a Trust
The trust deed sets the duration, up to a maximum of 100 years from its establishment.
🥣How to Set Up a Trust
Choose the parties: Identify settlor, trustee, and beneficiaries.
Define trust property: Land, investments, business interests, etc. Not only land.
Establish purpose and term: Clearly articulated in the deed.
Specify rights and duties: Trustee responsibilities and beneficiary entitlements.
Execute the trust deed.
Transfer assets: Settlor transfers property to trustee via the deed.
Register the trust: With the Trust Regulator within three months of creation.
🏠Additional points to note for land/real estate trust:
Pre‑transaction advice: Engage with a trustee before entering land purchase agreements—they should be party to such agreements or advise on terms.
Land title registration: Legal title must be registered in the trustee’s name, representing legal ownership. Beneficiaries hold beneficial rights.
This is for general reference only and does not constitute legal advice. For further guidance, contact us at: