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Chapter 9. Legal and Judicial Reform: Recent Developments and Prospects

Sumio Ishikawa, Sibel Beadle, Damien Eastman, Srobona Mitra, Alejandro Lopez Mejia, Wafa Abdelati, Koji Nakamura, Il Lee, Sònia Muñoz, Robert Hagemann, David Coe, and Nadia Rendak
Published Date:
February 2006
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Information about Asia and the Pacific Asia y el Pacífico
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Nadia Rendak and Damien Eastman 

While legal and judicial reform has been on the government’s agenda for the past 10 years, only in recent years has this work accelerated. So far, some progress has been made in drafting new legislation necessary to support a market economy, while results are considerably more modest in judicial reform. Section A provides a general background, Section B describes the current legal and judicial system, and Section C summarizes ongoing reform efforts. After discussing recent anti-corruption initiatives in Section D, the last section outlines challenges faced by Cambodia in implementing legal and judicial reform and considers actions that can be taken in the short term to accelerate reforms.

A. Background

Several decades of conflict undermined Cambodia’s economy and dealt a serious blow to its legal and judicial system. In 1993, Cambodia reemerged as the Kingdom of Cambodia in the form of a constitutional monarchy and started on the path of democratic reform. A new constitution was adopted in September 1993 based on the principles of liberal democracy and separation of powers. The RGC formed pursuant to the constitution, started reforms to transform Cambodia into a market economy.

However, after more than 10 years of effort, Cambodia is still confronted with serious legal and judicial reform challenges. Cambodia faces an urgent task of improving governance and creating a predictable business environment, both of which are crucial for achieving sustainable economic growth. Implementing broad-ranging legal and judicial reforms would be key for improving governance. Legal and regulatory frameworks should be established to assure effective public sector management and help promote private sector development. An effective and independent judiciary should be created to resolve disputes between individuals and businesses and to safeguard the rule of law.

To date, progress in legal and judicial reform in Cambodia has been slow and uneven, and governance remains weak. In a recent World Bank report on the investment climate in Cambodia (World Bank, 2004), corruption was identified as the most important obstacle to private sector development. Weak and unpredictable enforcement of the existing laws, contracts, and court decisions; inconsistent interpretation of laws and regulations; deficiencies in the public procurement regime; and the lack of accountability of the government all contribute to a poor image of Cambodia in the eyes of the international business and official communities.

B. The Current Legal and Judicial System

Cambodia’s legal and judicial system has undergone a substantial transformation since it achieved independence in 1956. Initially modeled after the French legal system based on a civil code and a French-style judiciary, then almost completely destroyed under the Khmer Rouge regime from 1975 to 1979, Cambodia’s legal and judicial system now represents a complex web of old and new laws, policies, and judicial institutions.

As in other countries with a continental legal system, legislation is the primary source of law in Cambodia. Other sources of law include the constitution, international treaties ratified by Cambodia, government decrees and regulations, and regulations adopted under the United Nations Transitional Authority, as well as customary laws. According to the 1993 constitution, previously passed legislation remains in effect to the extent that it does not contradict the new constitution. Therefore, Cambodia’s legal system currently comprises French-style laws adopted prior to 1956 as well as legislation subsequently adopted under various governments.52 Since 1993, many new laws have been adopted to support the emerging market-based system, and more legislation is being developed in connection with Cambodia’s accession to the WTO. Since there is no uniform interpretation of the above-mentioned constitutional provision, there is often confusion as to the extent to which different old laws apply. As new legislation is adopted, ensuring consistency between the old and new laws will represent a major challenge for Cambodia.

Despite many changes over the years, Cambodia’s court system remains modeled after the French-style judiciary. The 1993 constitution established a judiciary separate and independent from the legislative and executive branches. Under the constitution and the 1993 Law on the Organization of Courts, Cambodia’s judicial system now comprises provincial and municipal courts, a Military Court, a Court of Appeals, and a Supreme Court. Provincial and municipal courts are located throughout the country and are composed of a judge and a prosecutor. These are lower-level courts that adjudicate the majority of disputes. A municipal court decision can be appealed to the Court of Appeals on issues of both law and fact. The Supreme Court, located in Phnom Penh, is the highest court, with jurisdiction over the whole territory of Cambodia. With a few exceptions, the Supreme Court hears only questions of law.

Two other institutions, while not a part of the judiciary, play an important role in Cambodia’s legal system. First, the Constitutional Council was established in 1993 to decide the constitutionality of laws and regulations. Second, the Supreme Council of Magistracy (SCM) was established pursuant to the constitution to assist the king in guaranteeing the independence of the judiciary. The SCM is in charge of disciplining judges and prosecutors and ensuring the proper functioning of the courts. The SCM is chaired by the king, to whom it submits recommendations on the appointment, suspension, and removal of judges.

At present, there are no specialized courts or law to facilitate independent arbitration in Cambodia. However, the establishment of a commercial court and commercial arbitration is envisaged under WTO accession, and a nonbinding arbitration process was recently established under the Ministry of Labor to resolve labor disputes. In rural areas, many disputes go through an informal conciliation process before they reach the court. In the absence of specialized commercial courts, there is usually no distinction in the lower trial courts among civil, criminal, and commercial matters, or between different aspects of a single dispute.

Cambodia’s judicial system is plagued with problems and is regularly identified as one of the country’s most corrupt institutions.53 There is a perception shared by both individuals and businesses that fair and impartial resolution of their grievances through the formal court system cannot consistently be attained. The SCM is politicized and has thus far proven ineffective. There is no legal framework ensuring that only qualified individuals are appointed as judges. There are currently around 195 judges and prosecutors in Cambodia, most of whom were appointed under the previous regime, and many lack the necessary training and experience, especially to resolve commercial disputes. Political interests intervene heavily in the discharge of justice—judges who act against powerful political interests risk dismissal. Cambodia’s courts are generally understaffed and lack resources to effectively adjudicate cases. Enforcement of court judgments is very expensive and unpredictable. All this creates a general distrust of the judiciary and makes it, in its present form, an obstacle to the establishment of the rule of law.

C. Recent Developments

While some progress in legal and judicial reform has been achieved, reforms have proved slow and difficult. During 1994–2000, several attempts were made by the government to formulate a strategy for reforming the legal and judicial system. In February 1994, the “National Programme to Rehabilitate and Develop Cambodia” set out an overall vision for legal and judicial reform, and an action plan to implement the program was published by the government in February 1995. Several laws identified as requiring attention—including a law on the status of judges and prosecutors, a law on the organization and functioning of courts, the civil and criminal codes, and the law on status of clerks and bailiffs—were to be adopted within three years of the publication of the action plan. However, as of January 2005, none have been adopted. Strengthening of the judiciary and law enforcement was also identified as a cross-cutting issue under the government’s 2001 Governance Action Plan and in the National Poverty Reduction Strategy adopted in 2002. Again, no concrete action followed.

Various institutional arrangements were made over the years to facilitate reforms but they have been mostly ineffective. In March 1994, a Council of Jurists was created under the Council of Ministers to assist the government in formulating reforms. Later, in April 2000, a separate Judicial Reform Council was established to formulate and implement reforms under the Supreme Council of State Reform, which in turn was created in 1999 and chaired by the prime minister. Despite these institutional changes, reform measures envisaged in 1994–1995 failed to produce any concrete results. In June 2002, a new body, the Council for Legal and Judicial Reform, was established, and a Permanent Coordination Body (PCB) for the Council was formed in August 2002.

In June 2003, the government approved a comprehensive Strategy for Legal and Judicial Reform (“Strategy”) and circulated an action plan for its implementation. The action plan, however, did not prioritize reform measures and lacked details on the responsibilities and financing and implementation arrangements. In December 2003, a national workshop on the implementation of the Strategy was held. At the workshop, five working groups were formed to develop reform recommendations in the following areas: (1) anchoring the legal framework; (2) empowering the market economy; (3) improving the quality of access to legal and judicial services; (4) strengthening legal and justice sector institutions; and (5) introducing and reinforcing alternative dispute resolution mechanisms and legal awareness.

In June 2004, the Project Management Unit (PMU) created under the PCB refined the draft action plan into a list of short- and medium-term priorities54

Box 9.1.Short- and Medium-Term Priorities for Legal and Judicial Reforms Under the June 2004 Action Plan

Since the national workshop on legal and judicial reform in December 2003, the Project Management Unit (PMU) has hosted various group meetings and bilateral meetings with representatives from the justice sector institutions, civil society, and the international community. The proceedings of these meetings have served as input to establishing priorities for the PMU’s action plan. The action plan is centered around seven strategic objectives: improving and protecting fundamental rights and freedoms, modernizing the legislative framework, improving access to legal and judicial information, enhancing the quality of the legal process, strengthening judicial services, introducing alternative dispute resolution mechanisms, and strengthening legal and judicial institutions.

Key short-term priorities are focused on a range of new laws and setting the foundation for restructuring the justice sector, and include drafting a Civil Code, Civil Procedures Code, Criminal Code, and Criminal Procedures Code; preparing the Statute of Magistrates; enacting the anti-corruption law; drafting laws to establish a commercial court; adopting a law on commercial arbitration; and measures to institutionalize the publication of statutory laws and court decisions (including a collection of past court decisions).

Key medium-term priorities include completing the legislative framework pertaining to the justice sector, which will involve adopting an Administrative Procedures Code, educating the legal profession with respect to new laws and providing specialist training programs, and completing the restructuring of the courts; providing training and awareness programs on human rights and fundamental rights; introducing a law and policy for legal aid; and developing codes of ethics for judges, prosecutors, and legal practitioners.

(Box 9.1). Listed among short-term priorities are some of the measures that have been pending since the mid- and late 1990s, including the restructuring of the SCM, adoption of the law on the organization and functioning of courts, and enactment of the anti-corruption law. The action plan envisions, however, that implementing these measures may extend beyond 2006, making their quick passage unlikely. The government has circulated the action plan to all interested stakeholders to generate assistance from the international community for various projects.

Apart from the above-mentioned efforts to formulate a reform strategy, there has been little real progress in judicial reform. Among the few positive developments in the last several years are a modest increase of judges’ salaries in January 2003 (the salaries were increased on average from $25–30 a month to $200–400 a month), and the establishment of the Royal School of Judges and Prosecutors in 2002. The school was established to train new and existing judges and prosecutors and to provide continuing legal education.55 In November 2003, the school enrolled its first 55 students who will graduate in two years to become judges. The school is financed by the government and supported by several donors, including the French government, the United Nations Development Programme, and the German Development Agency. While the establishment of the school is a positive development, it cannot be expected to have an immediate effect on the quality of the judiciary. With the first class to graduate only in late 2005, it will take time for the school to become fully operational, and its contribution to the training of judges and prosecutors will start bearing fruit over a period of several years, at best.

More has been done to modernize Cambodia’s legal system when compared with the slow progress of the judiciary. Progress has been made since 1993 in reforming many areas of legislation, including tax legislation and laws governing the banking and financial sectors. The 1996 Central Bank Law and the 1999 Financial Institutions Law, and their implementing regulations, established a sound legal framework for operations of commercial banks and for the central bank’s supervision. In 1994–1995, a basic legal framework for public procurement was put in place.56 A new Land Law, adopted in 2001, established a modern legal framework for land use and transactions in land. A centralized land registry (Cadastre) was created to record title to, and all transactions (such as transfers and mortgages) in, land. Work on land titling is currently under way and is supported by several donors.

Additional laws are needed to strengthen protection of property rights, promote financial intermediation, and strengthen enforcement of creditor rights. Laws on negotiable instruments and payments transactions, insolvency, secured transactions, government and corporate securities, commercial contracts, and commercial arbitration should be adopted or, if already adopted, enacted by the National Assembly. Without these laws, the legal framework for safeguarding financial transactions and resolving commercial disputes—both essential for economic growth—remains incomplete.

Reforms on the legal side further accelerated in 2002 in conjunction with Cambodia’s preparation to join the WTO. WTO accession is an important factor in accelerating reforms in general and legal and judicial reform in particular, since WTO membership imposes on Cambodia certain obligations with respect to improving the legal framework for business transactions and enforcement of contracts. To fulfill its WTO commitments, within the next several years Cambodia will have to pass 46 new laws ranging from customs to intellectual property. While 14 laws have already been adopted, many others are at a drafting stage.

Box 9.2:Establishment of a Commercial Court

A draft law to establish Cambodia’s commercial court is currently being revised. The law is aimed at establishing a court by end-2004 (now more likely in 2005) to more efficiently and effectively resolve disputes of a commercial nature. The commercial court would be composed of three judges and two associate judges, each holding office for a renewable five-year term, and appointed by royal decree upon recommendation from the Supreme Council of Magistracy. Only persons who have completed a specialized education program for commercial court judges would be eligible for appointment.

The court would be vested with jurisdiction to hear disputes in a broad range of commercial areas, including business, banking and finance, insolvency, intellectual property, trade, and competition, of both a civil and criminal nature. It would also have exclusive jurisdiction over the recognition and enforcement of foreign court orders and foreign arbitral awards. The operations of the commercial court would be governed by the Commercial Court Rules of Procedure, supplemented by the Civil Procedure and Criminal Procedure codes. The current proposal would seat the commercial court in Phnom Penh, but allow the court to temporarily sit in places throughout Cambodia as necessary.

The current draft law has drawn comments from a number of participants, including donors, who are divided on whether the court should be based on a civil or common law system, and the extent to which the court should be separate from, and consequently outside the potential influence of, the executive branch. Additionally, issues such as the broad nature of the court’s jurisdiction (which could lead to the court hearing noncommercial disputes) and whether there should be a threshold or minimum amount in dispute, are areas of the draft law that have drawn comments and proposals for revision.

Accession to the WTO is giving a new momentum to judicial reform. One of the commitments under the WTO is that Cambodia should establish a specialized court to adjudicate commercial disputes. A draft law on a commercial court was prepared under the auspices of the Ministry of Commerce and is now being discussed among government agencies and legal experts. No consensus has yet been reached on many key aspects of the new court (Box 9.2). As a WTO member, Cambodia should also establish procedures for appealing administrative decisions and for enforcing foreign arbitral awards.57

Donors and other representatives of the international community have repeatedly expressed their disappointment with Cambodia’s lack of progress in judicial reform, most recently at the 2004 meetings of the Consultative Group of Donors.58 The authorities have acknowledged that reforms have lagged and have expressed their intention to make progress on legal and judicial reform.

D. Anti-Corruption Initiatives

The Cambodian authorities have long acknowledged governance problems as a cross-cutting issue, but little has been done so far to address them. While the existing criminal laws allow for prosecution for corruption, not a single case has yet been brought to court, and no government official has been charged. Eliminating corruption will require a comprehensive strategy that should include broad-ranging reforms of the civil service, increasing transparency of government operations, and improving the legal and institutional frameworks for government and private business operations (including changes to the public procurement regime).

Some positive recent initiatives aimed at addressing governance issues include Cambodia’s endorsement of the Asian Development Bank’s and the Organization for Economic Cooperation and Development’s Anti-Corruption Initiative for Asia and the Pacific; enactment in 2000 of the Law on Audit and establishment of the National Audit Authority; enactment of a law on accounting; and adoption of a comprehensive anti-corruption law, which was submitted to the National Assembly in early 2004.

The draft anti-corruption law provides for the establishment of an independent anti-corruption agency—the Supreme Council Against Corruption—that would investigate but not prosecute corruption (Box 9.3). The law also requires government officials to declare their assets and liabilities. While the adoption of an anti-corruption law is welcome, its implementation will be key. Successful prosecution of corruption cases will require a strong judiciary and law enforcement.

Curbing corruption in the judiciary will require a comprehensive approach. As a priority, the SCM should be reformed to make it less politicized, more independent, and more effective, and a law on the status of judges and prosecutors should be adopted. The latter is essential to ensure the independence and effective functioning of the judiciary, as it will establish a judicial service tenure system, an appointment process and requirements, service conditions and benefits, codes of conduct, and a defined salary structure. While several drafts of this law and of amendments to the law on the SCM were circulated in the past, none has thus far been adopted. Among other important measures that would help to improve governance in the judiciary is ensuring that all legislation is published on a timely basis and made available to general public. Publicizing court decisions will also increase transparency and effectiveness of the courts.

Box 9.3.Anti-Corruption Law

A draft of Cambodia’s anti-corruption law has been submitted to Parliament. The proposed law is intended to tackle corruption throughout Cambodia and defines corruption to include acts of bribery, the giving or accepting of unlawful gratuities or services, using unlawful authority or power on duty, embezzling or exploiting national assets, tampering with documents, and performing tasks conflicting with designated duties. It mandates that officers of national institutions (officers are defined to include a broad range of publicly elected and appointed officials) declare their assets and debts in writing upon entry or exit from office, and at least once every other year.

The proposed anti-corruption law establishes a Supreme Council Against Corruption (SCAC) with an independent budget and the ability to request additional resources from external donors. The SCAC would comprise six members, each member appointed by a different arm of government and having duties that include the broad authority to present the government with measures to eliminate corruption, examination of reports and instigating investigations where there are allegations of corruption, summoning necessary persons to appear before it, and preparing files and records of its investigations. The law creates a general Secretariat, vested with the power to investigate allegations of corrupt activity. Its organization and functioning is to be clarified in a sub-decree, which has also yet to be enacted. Under the proposed law, neither the SCAC nor the Secretariat is vested with power to prosecute corruptions. The draft law also provides for the rules of evidence, allows the SCAC to order administrative leave for those accused of corruption, and prescribes the penalties for persons involved in corruption, which, depending on the benefit obtained from the corruption, range from imprisonment for one month to 15 years and a fine of twice the amount obtained from the corruption.

Although the proposed law introduces an appointment process allowing the different arms of government to appoint members to the SCAC, and seeks to strengthen that independence by allowing the members of the SCAC to elect the chairman and vice-chairman, the law does not require a potential appointee to meet any minimum professional standards, thus possibly opening the way for appointments that may undermine the true independence of the SCAC.

E. A Way Forward

Despite some progress in legal and judicial reform, reforms have thus far been hampered by limited human and financial resources and the apparent lack of focus and commitment at the top level. It remains to be seen whether the government formed in 2004 will be able to deliver on past promises.

Even with renewed commitments of the new government, Cambodia will continue to face significant challenges in implementing legal and judicial reform. These challenges—limited human and financial resources, weak institutions, and widespread governance problems, including in the judiciary and in law enforcement—are common to many less-developed countries. In Cambodia, they have been exacerbated by several decades of conflict and a very limited pool of capable individuals currently in the public service. While Cambodia has benefited significantly from international assistance in the legal and judicial reform area, that assistance creates additional challenges by the conflicting influence of different schools of thought (civil vs. common law systems) sometimes pursued by different donors. In the absence of a clearly formulated reform strategy, it has been difficult for donors to effectively coordinate their assistance.

The action plan prepared by the PMU in June 2004 sets out an ambitious plan for short- and medium-term reforms. Many of the measures included in the plan are long overdue. The necessary reforms can be implemented only with full commitment at the top level and with the mobilization of Cambodia’s internal resources supplemented by international assistance.

While many reform measures may require significant donor assistance, some measures that require little or no such assistance can, and should, be implemented. Those include

  • Adopting the law on the status of judges and prosecutors that would establish an appointment process and the terms and conditions of service, including a code of conduct.
  • Taking concrete steps to ensure the independence and the transparency of the operation of the Supreme Council of the Magistry, to enable it to fulfill its functions set forth in the constitution.
  • Establishing a commercial court that will specialize in commercial dispute resolution.
  • Enacting an anti-corruption law that establishes an effective framework for investigation and prosecution of corruption offenses and provides for declaration of income and assets by government officials; and preparing the implementing regulations.
  • Publishing all court decisions and creating a repository of all laws in both Khmer and English.

Most of these measures were identified as short-term priorities in the action plan prepared by the Council for Legal and Judicial Reform. Implementing these measures will signal to investors and donors the authorities’ commitment to legal and judicial reform and will hopefully help to unlock new investment and additional international assistance.

All this having been said, it has to be recognized that any progress in legal and judicial reform in Cambodia will be gradual. While the adoption of new legislation is important, it will be equally important to ensure that the new laws are effectively implemented. This will require strengthening the existing institutions and creating new institutions necessary to enforce new laws, training new officials, fighting corruption in the government and in the judiciary, and gradually changing the culture in the society toward the rule of law. For the reforms to succeed, it will be necessary for the authorities, the private sector, and the international community to work closely together.


For a more detailed discussion of Cambodia’s legal and judicial system see Sok and Denora (1998, pp. 4–15).


In World Bank (2004), the judiciary was rated lowest in Cambodia among a number of public institutions and agencies rated for their integrity.


Short-term is defined as 2004–06, while medium-term covers 2004–08.


However, the law on the status of judges and prosecutors, which will make completing a training course at the school a mandatory requirement for appointment of all new judges, is yet to be adopted.


This basic legal framework for public procurement is in need of revision, especially with regard to transparency of procedures.


In 2001, Cambodia ratified the United Nations Convention on the Enforcement of Foreign Arbitral Awards (“New York Convention”) and the Convention on the International Center for Settlement of Investment Disputes between States and Nationals of Other States (“ICSID Convention”), although it has not yet adopted implementing regulations for either of the conventions.


Lack of progress in legal and judicial reform was well summarized in the Note on Legal and Judicial Reform prepared by the Cambodian Office of the High Commissioner for Human Rights for January 2003.

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