Partner Perspectives: Sovicheany Pheng

Could you please tell us a bit about yourself?
My name is Sovicheany, I am the managing partner at Davies SM. I’m a dual licence lawyer admitted in Cambodia and Australia. I specialise in foreign investment and commercial law. I had my education in Australia at the University of Sydney where I did a Bachelor’s of Economics and a Bachelor’s of Law and Masters of Law, specialising in commercial law. Then I went for a lawyer training at the NSW College of Law, and then got admitted as a lawyer in Australia in 2014.

So after my admission as a lawyer in 2014, I worked in Australia at Commercial Law Firm and Private Institution until 2017. I moved back to Cambodia and worked at two reputable commercial law firms in Cambodia until 2023 where I started this law firm. So since I moved to Cambodia, I mainly advise foreign clients on foreign investment in Cambodia, mainly on market entry, complex business licencing, mergers and acquisition and cross-border transactions.

Can you tell us about the founding of your firm and the vision behind it?
So this law firm was established in 2023 when we had the new Manet government. After working in Cambodia for several years and providing legal services to foreign investors, I saw a growing demand in quality legal services. And I think it’s the right time because the new government, Manet government, is really focusing on attracting investment and making Cambodia a more attractive investment destination for investors.

What are the services offered by your firm and what is it’s unique selling proposition?
We are a full service commercial law firm. We provide commercial and tax services to clients such as market entry, merger, acquisition, legal and tax advice, labour, real estate, construction and we provide services in certain specific industries for example, energy and other emerging sectors which are attractive for foreign investors in Cambodia.

So with respect to our unique selling point is that we are committed to provide high quality legal and tax services to our clients at cost effective rate. So we as a newly established law firm, would like to build more of our client portfolio and we are very happy to provide very good quality services at cost effective rates to new investors that come to Cambodia. So if you look at other international firms, if you compare we can provide at the same quality but at better rates. Our team comprised of young and dynamic professionals who have experience at all these commercial firms and some at multinational companies. Some of them have advanced degree and have studied abroad in Australia like myself. And we are very committed to provide excellent services to our clients and help our clients navigate Cambodia’s regulatory framework.

Can you describe the current foreign investment landscape in Cambodia?
Yes. So over the past two decades, the Cambodian government is really encouraging foreign investment because they believe that that is the main source of growth for Cambodia. Especially with our new Manet government, the emphasis on attracting more foreign investment is even more extreme. We have seen that the PM has put into place many really good business friendly initiatives and he has also gone to foreign countries to speak to foreign investors and try to understand their needs and explore ways to do business with foreign countries.

Are there any recent changes in Cambodian law that could significantly impact foreign investors?
Over the past few years we have seen so many changes in the legal framework which could bring positive impacts on foreign investment. To just name a few, we have the new investment laws and regulations which provide more incentives, non-tax and tax incentives to investors, both local and foreign investors. And most of the incentives are mainly provided in sectors that encourage that promotes green businesses and which is high teach, but there’s a lot more.

Currently there is about 19 sectors that is being promoted under this new investment law. And the other area is consumer and competition law, which now there are a series of regulations which are newly enacted aiming to promote fairer businesses in Cambodia. We now have unfair contract clauses, and we have a few other new regulations pursuant to Consumer and Competition law. It was enacted in 2021 with many supporting regulations in place and one of the main ones is merger control, sub decree on merger control, so this will have an impact on mergers and acquisition in Cambodia.

What are the primary dispute-resolution mechanisms available for investors?
There is also the idea of promoting more dispute venues for investors to solve their commercial disputes, which one of the main ones is the commercial court. Commercial Court initiative is intended to create more dispute venues for investments to take to resolve their commercial disputes. And in addition to this commercial court initiative, we also have other alternative dispute resolution which includes mediation and conciliation. So, the whole idea behind this is to enable foreign investors to better resolve their commercial disputes in Cambodia.

Previously, when there are commercial disputes and if foreign investors choose to go to Cambodian court, it will be very, very lengthy. And so, foreign investors are mainly left with arbitration which can either be done in national commercial arbitration in Cambodia or resolve at arbitration outside Cambodia.

What are the other initiatives being implemented to facilitate investors’ entry into the Cambodian market?
Other initiatives that are being put in place is the move to E-government. So the government has been putting lots of public services through electronic platforms, which now businesses can apply for licences or registration online. So this will be very beneficial for businesses because it cuts down their the time spent the cost. Government is also trying to promote international trade. So far, they have been negotiating many trade treaties with other countries and the government has also been negotiating double tax treaty. So the whole purpose of these international trade treaties and double tax treaty are to The implication is to enable business to have reduced tax and custom rates.

Based on your observations, what is the government’s overall targets?
The government’s target is to reach middle income within the next 5 years and high income in 2050. So, what the government is trying to do now is to promote investment in Cambodia. This can be done by bringing investors to Cambodia because we are a small open economy and to catch up fast with the world, we need foreign investors coming into the country to bring technology and knowledge so that our local people can learn and work with these foreigners to expand our economy and work towards that goal.

What do you seek to achieve as a law firm?
So our goal is to become one of the top commercial law firms in Cambodia and to reach that stage it will require certain phases. So what we do now, when we look for talents, we look for someone who has at least English knowledge and legal skills. And we also look for someone with experience at commercial law firms or experience abroad because this will help to build the skills of our team.

Could you describe a preferred working environment for your law firm?
So the atmosphere that we want to create in this law firm is work hard, play hard. And we while we work really, really hard and we try to provide quality services to our client, we also emphasise on work life balance. So we always manage to ensure that our team go to the gym and do exercise as if you see in our job description, you will notice that we provide our team members gym and other facilities so that they can do outside their working hours. We know that working in the legal field is very, very stressful and they will need to find ways to release all these and the best would be through exercise.