Data released to the public by the International Consortium of Investigative Journalists (ICIJ) reveals the offshore holdings of a number of individuals with links to Cambodia. But analysts say Cambodia’s lax regulatory environment and loopholes in the tax system mean the scale of offshoring and its impacts for Cambodia remain unknown.
The ICIJ on May 9 added names garnered from the leak of more than 11.5 million documents from Panama-based law firm Mossack Fonseca to a database already listing individuals and companies using offshore firms. Such companies can help the wealthy to avoid higher tax rates or scrutiny. Including information from an earlier leak, the data includes the names of 25 individuals related to Cambodia, holding shares in 26 different offshore companies.
Among the individuals named is Cambodian Justice Minister Ang Vong Vathana. The minister is alleged in the documents to have bought $5,000 worth of shares in a company called RCD International. The now-defunct company, the purpose of which remains unknown, was based in Hong Kong and involved other Cambodians and people with Chinese names. Ang Vong Vathana has outright denied he was involved in the company.
There are also other familiar Cambodian names in the documents.
Lim Bunsour, president and CEO of AZ Group of Companies and also a board member of the Cambodia Chamber of Commerce, is named in the leak known as the Panama Papers.
Also named are Nang Sothy, president of Thy Holding Group Co. Ltd, who is a secretary of the executive board of the Cambodia Chamber of Commerce, and Sreang Tito, the owner of internet service provider Mekong Net.
There are also unknown individuals who appear to have significant offshore activities. Someone named Long Virak is named as shareholder in five different companies, namely Easy Flow Media Ltd, Solid Media Solutions Ltd., Ultra Media Entertainment Ltd., Speedquick Media Ltd. and Big Aim Ltd.
There are also individuals with foreign names using addresses in Cambodia in their offshore dealings, the papers reveal. These include Wong Swie Hwa, who partnered with Lim Sophany to invest in King Fortress Investments.
The list also names OKUBO Alejandro Marcelo of Triumph Business Development Ltd., Kwok Stanley Kar Kuen of Clever Leader Holdings, Chong Mei Sing of the De’ Cove Investments Ltd., Dmitry S Stepanov of the PMT Air Corp and Skaret Sindre of the Golden Luck Winner Limited.
Chan Sophal, president of the Phnom Penh-based Centre for Policy Studies, said it was impossible to say exactly how much tax revenue Cambodia’s government might have missed out on due to business people keeping assets offshore.
“But I don’t think it is in a big scale that can hinder our economy yet,” said Chan Sophal. “I don’t think such a scheme can stop our economy prospering even further, either. It is probably still at a small scale.”
Adding another layer of complication, Cambodia does not have a law requiring local investors to declare their income made inside or outside of the country.
“We still have a loophole on this point,” said lawyer Sok Samoeun. “We only have tax on salary of employees and there is no provision on taxing employers’ income.”
