The Decision on Requirements and Procedures of Exemptions under the Law on Competition was released by the Ministry of Commerce ("MOC") on April 02, 2024. In this decision, the procedures and requirements for submitting petitions for exemption are expounded upon in Article 12 of the Law on Competition ("LOC").

Scope of Application

This Decision is applicable to any contracts or actions that would hinder, limit, or stifle competition in the Cambodian market. If the agreements or activities fulfill the particular requirements allowed by Article 12 of the LOC, these exclusions are available whether they take place inside or outside of Cambodia.

Authority

The Consumer Protection Competition and Fraud Repression Directorate Generate ("CCF") is the implementing organization and secretariat for conducting prior consultation, receiving, and reviewing the exemption application. The Cambodia Competition Commission ("CCC") will review the exemption application.

Eligibility for Exemption Request

Anyone wishing to engage in any activity or enter into a contract that might violate Articles 7, 8, 9, and 11 of the LOC ("Proposed Activity") prohibiting dominant market positions, agreements between horizontal and vertical parties, and business combinations may submit an exemption application to the CCC for approval in advance ("Exemption Application").

Requirement for Exemption

The conditions of Article 12 of the CCC are further explained in Article 5 of this Decision. The CCC may grant an exemption if the applicant can show, by adequate supporting documents, that the Proposed Activity satisfies the following four requirements:

1. If there are notable technological, social, or financial advantages to the proposed activity. These advantages include both qualitative and cost-related efficiencies (e.g., enhancements in quality, range, and service, technical breakthroughs, or advantages for the environment and sustainability) and economic and cost-related efficiencies (e.g., economies of scale) ("Benefits").
2. If the proposed activity is not carried out, the benefits will not materialize. In order to meet this requirement, the applicant must show that: i) the proposed activity's prevention, restriction, or distortion of competition is reasonable and necessary to realize the benefits; and ii) there are no other ways to achieve the benefits without enforcing restrictions on competition.
3. The positive effects outweigh the drawbacks brought on by limitation, prevention, or distortion, which can last for up to a year. Additionally, the application must guarantee that customers will profit and be made whole for any adverse effects.
4. Competition remains in place in key areas related to products and services.