Organic Law on Administrative Management of Capital, Provinces, Municipalities, Districts and Khans (2008)

Section 1. Capital, Provincial, Municipal, District, and Khan Councils Council elections occur indirectly in line with the Law on the Election of Commune/Sangkat Councils. Elections cover 5-year terms of councils, which can undertake only caretaker duties once their term has expired. The council is chaired by the person who gets the most votes. The capital has a maximum of 21 councillors, provinces have 9–21, municipalities 7–15, and districts and khans 7–19. The actual number in each location is based on demography and geography and is set out in a sub decree. Councils operate democratically and represent all citizens. Councillors can be male or female and must be at least 25 years old and meet other criteria of the election law. Based on decisions of the Ministry of Interior (MOI), councillors can lose their positions if they cease to meet eligibility requirements, on resignation, death, non-attendance at meetings, dismissal in line with the law, if convicted of crime, or if they lose membership of the political party whose platform they were elected on. In case of a vacancy, the next highest number on the candidate’s list provides the replacement (in line with a Prakas [regulations] of the MOI). Councils must follow the constitution, laws, sub decrees, and instructions of the MOI, and failure to do so can lead to dissolution of the council by issue of a sub decree. In cases of dissolution or establishment of a new council, there shall be an election, but there shall be no by-elections within 6 months of the next council elections. The MOI may manage a dissolved council. Councillors are paid from an annual budget of the council based on levels set out in a sub decree.

Section 2. Roles, Duties, and Authorities of Councils Councils operate democratically and pursue functions and duties as delegated and assigned in line with this law. Councils can make legislative and executive decisions. They pursue functions and duties through decisions of council and are accountable directly to citizens. Councils can acquire information including by surveys and through the governor and board of governors. They are accountable to the government for following the Constitution, laws, royal decrees, sub decrees, and other legal instruments. Councils shall make legislative decisions on matters relating to new functions, obligatory functions, permissive functions, 3-year investment programs, 5-year area development plans including activities of central agencies and ministries, annual budget and medium-term expenditure plans, financial management matters, structures and committees of council, asset management, citizen consultation, and other duties as stipulated by law. Councils shall formulate and adopt a 5-year development plan which is updated annually, and also a rolling 3-year investment plan. The development plan must be prepared after consultation with citizens, other councils, ministries, stakeholders, etc. as set out in a sub decree of the ministries of Interior and Planning. The development plan shall include (i) vision, goals, objectives, (ii) a status report; (iii) a needs assessment as to functions, services, poverty reduction, etc.; (iv) a development framework for land and natural resources; (v) a disaster management plan; (vi) a financial plan, investment plan, and annual and 3-year budgets; (vii) a strategy for plan implementation based on transparency and accountability; and (viii) key targets and performance indicators. The plan and budget must distinguish between permissive and obligatory functions. Procedures for preparing, adopting, and implementing plans are to be set out by sub decree. There shall be annual monitoring and evaluation of performance in relation to the plan involving all stakeholders. The plan is to be made available to the public at the council office and to be distributed without charge. Public financial management is to be transparent and accountable stressing democracy and priority development needs and focusing on newly assigned and delegated functions, essential services and infrastructure, poverty reduction, and other priority needs. The capital, provinces, municipalities, and districts shall have their own budgets (this does not apply to khans and Sangkat in the capital city which have budgets within the capital city budget or to Sangkat in municipalities which have budgets within the municipality budget). Councils shall approve sound and balanced budgets in line with the central government budget calendar. Councils are to prepare a medium-term expenditure plan and update it annually. Budget preparation, execution, and monitoring should follow a proposed law on subnational administration financial management that is to be enacted in line with this law and the Law on Public Finance Systems. Councils are to follow sound public financial management (PFM) standards, rules, systems, etc. as defined in the aforementioned laws. This applies to (i) budget preparation, approval, and implementation; (ii) accounting; (iii) reporting; (iv) assets and liabilities; (v) transparency and accountability; (vi) own-revenue policies; (vii) shared revenues; (viii) ministry and agency fees; (ix) other revenues; (x) public procurement; (xi) internal audit; and (xii) external audit. A law shall set out the approach to ownership and management of subnational administration assets. All abuses of powers in relation to finance, assets, persons, etc. are to be reported to the MOI. Abuses relate to legal rights, human rights, assets and resources, the environment, state funds and assets, payments and gifts, adoption of irregular legislation, and provision of benefits to families. Councils shall prepare and approve annual reports on decisions and legislation, activities implemented, financial management, evaluations by boards of governors and officials, results of monitoring and evaluation, and other important improvements. All councils are to have a prominent information board.

Section 3. Council By-Laws (Deika) By-laws or rules can cover the scope of functions (assigned and delegated), roles, duties, authorities, resources, and other areas of council. Generally, by-laws cover the entire council area but may exclude certain parts. By-laws cannot be retroactive and must be consistent with higher national laws and legal instruments. They cannot discriminate by race, religion, sex, age, colour, nationality, or disability. They can provide for fines for noncompliance. Procedures for preparing, approving, amending, and repealing by-laws are to be set out in a sub decree. Council is responsible for implementing and enforcing by-laws, if necessary following written request with support of the police.

Section 4. Meetings and Internal Rules The MOI chairs the first meeting of the council, to be held within 14 days of election results. Subsequent meetings are chaired by the council chair in line with internal rules. When the chair is absent, the next highest in voting precedence chairs the meeting. A voting quorum for by-laws is at least 50%, with the chair having a casting vote in the event of a tie. Councils are to meet in public but may have confidential meetings in line with guidelines issued by the MOI. Internal rules of the council are to be confirmed by a by-law at the second meeting of the council. Decisions not following internal rules are invalid. Councillors are allowed full freedom of expression. At least 12 ordinary meetings of council per year are to be held, based on an annual schedule which is publicized. Extraordinary meetings can be convened by council as required.

Section 5. Illegal Conduct of Council and Council Officials Councillors, committees, boards of governors, governors, and officials are all liable for any illegal actions; illegal expenditures may be declared invalid. The MOI shall advise the council and governor in writing of any illegal actions and they must respond within 1 month, following which the MOI will decide on the illegality within 1 month. The council and board of governors can consult with the MOI on sensitive matters, who can advise on how to resolve illegal decisions. Where illegal decisions cannot be resolved, they are to be cancelled with the cancellation decision publicized. Persons affected by cancelled decisions (e.g., tax or service charge payers) may claim reimbursement and, in case of disputes, may apply to the MOI and, if not satisfied, to the courts. Councillors and boards of governors are responsible for recovery of any illegal expenditures and, where individuals are found responsible, they can be made personally liable for reimbursement. The MOI may delegate authority to districts to check on the legality of commune and Sangkat matters based on this law and the 2001 commune and Sangkat law.

Section 6. Solving Local Conflicts Councils should facilitate local conflicts on written request of one or more parties. Where mediation fails or is outside of their jurisdiction, council will advise the parties on other legal alternatives. Councils shall not mediate on divorce, violence, crimes, matters before courts, and where laws provide other solutions. Procedures for resolving local conflicts will be based on laws or a sub decree.

Section 7. Special Provisions for Districts and their Communes and Sangkat District councils are to support all their commune and Sangkat councils to develop democratically. The district council is responsible and accountable to its commune and Sangkat councils and all citizens in the district for its actions and performance. Districts are to regularly communicate with communes and sangkats and build capacity, resources, and awareness of councillors and staff in conjunction with the MOI, which has overall responsibility for capacity building at all levels, so they can address functional requirements. The district, communes, and sangkats are to integrate 5-year development plans and 3- year investment plans and annual and medium-term budgets. Two or more councils may share resources. Where districts are not able to build capacity in the communes and sangkats, they must report to the MOI, who should support the districts.

Section 8. Phnom Penh Capital Khan and Sangkat councils within Phnom Penh are supervised and managed by the capital council, which shall delegate functions and roles to the khan and Sangkat councils. Working arrangements between the capital, khans, and sangkats shall be set out in a sub decree.

Section 9. Municipalities Other Than Phnom Penh Sangkat councils within a municipality come under the supervision and management of the municipality, which delegates functions and duties to the Sangkat councils. Working relations of the provincial council, the municipal council, and Sangkat councils are to be set out in a sub decree. Chapter 3. Committees of Councils and Boards of Governors

Section 1. Formation of Committees Councils are obliged to have the following committees: technical facilitation, women’s and children’s affairs, and procurement. Additional committees may be set up providing they do not overlap. Council is to ensure secretarial and other support for committees. Councillors, the governor, members of boards of governors, and officials can be committee members, which may have external advisers. The council determines structures and compositions of committees. Women are to be represented on all committees and may chair them. The council is responsible for the work of committees and may dismiss them and its members.

Section 2. Technical Facilitation Committee This committee is composed of governor as chair, all unit chiefs of council, chief of finance, local chief of all central government ministries and agencies present in the region, and others as needed. The role of the committee is to coordinate national and local efforts through the 5-year development plan, the 3-year investment plan, the medium-term expenditure framework, and the annual budget. The MOI may allow two or more councils to share a single technical facilitation committee. Procedures for forming and operating this committee are set out in a sub decree.

Section 3. Women’s and Children’s Affairs Committee This committee is to be composed of women councillors and other women. Two members of this committee can participate in any council, committee, or board of governors meetings though they cannot vote and must receive agendas, papers, etc. as per other members. An annual report of this committee should go in the council annual report. The MOI may issue guidelines on the roles and operations of this committee.

Section 4. Procurement Committee The aim of the committee is to ensure proper procurement practices (integrity, openness, transparency, and fairness) in line with a proposed Law on Procurement. The ministries of Economy and Finance and Interior are to issue a joint Prakas (regulations) on the roles and operations of this committee.

Section 5. Board of Governors A board of governors is to be established in all subnational administrations. The board of governors is chaired by the governor and contains a prescribed number of deputy governors as set out in a sub decree. The capital has a maximum of 7 members; provinces have 3–7 members; and municipalities, districts, and khans have 3–5 members. The governor of the capital and provinces is appointed by royal decree on a request by the prime minister which, in turn, is based on proposals of the MOI. Deputy Governors of the capital and provinces and governors of municipalities, districts, and khans are appointed by sub decree based on a request of the MOI. Deputy Governors of municipalities, districts, and khans are appointed by Prakas of the MOI. Governors of the capital and provinces are selected from eligible senior civil servants in the MOI. They must be at least 35 years of age, hold first rank, have 7 years of public administration experience and a bachelor’s degree, be a registered voter, and have no criminal record. Deputy Governors of the capital and provinces are selected from eligible senior civil servants in the MOI. They must be at least 35 years of age, hold second rank, have 5 years of public administration experience and a bachelor’s degree, be a registered voter, and have no criminal record. Governors of municipalities, districts, and khans are selected from eligible senior civil servants in the MOI. They must be at least 30 years of age, hold third rank, have 5 years of public administration experience and a bachelor’s degree, be a registered voter, and have no criminal record. Deputy Governors of municipalities, districts, and khans are selected from eligible middle-ranking civil servants of MOI. They must be at least 25 years of age, hold first rank of middle level, have 3 years of public administration experience and an associate degree, be a registered voter, and have no criminal record. Governors and deputy governors have maximum terms of 4 years and can be given another term. They are not councillors and cannot vote in council meetings though they can participate in them. They can resign or be terminated for loss of qualifications, incapability, poor performance, poor health or incapacity, abandonment of duty, and abuse of professional ethics. The council may request the MOI to terminate on these grounds, following which they shall investigate and report to the prime minister regarding governors and deputy governors of the capital and provinces and governors of municipalities, districts, and khans. The MOI may directly decide on deputy governors of municipalities, districts, and khans. Governors and deputy governors receive remuneration in line with a sub decree requested by the MOI after first consulting the Ministry of Finance and Economy (MEF). Governors represent, supervise, and coordinate the central ministries and agencies operating in the area (particularly issues of security, social and public order, law, and human rights). The governor is accountable to the central government, the MOI, and central ministries and agencies. The roles and authorities of the governor may be set out in a sub decree requested by the MOI. The board of governors (i) provides advice on strategies, structure, systems, resources, and monitoring and evaluation of performance; (ii) implements council decisions; and (iii) supports council so they can meet their goals. In addition, the board of governors provides reports (including reports of committees) to council. The council monitors the performance of the board of governors and may seek clarifications at council meetings. Boards of governors cannot make decisions in the jurisdiction of the council and, if they do, these are invalid. The board of governors shall ensure that officials and units of the council perform satisfactorily. The board of governors advises council on organizational units, roles and terms of reference of staff; appointment, promotion, termination, etc. of staff; salaries of staff; administrative and financial procedures; and capacity building strategies. The board of governors prepares and submits to council for approval a 3-year investment plan, a 5-year development plan and medium-term expenditure framework, and an annual report on performance for distribution to public. The board of governors also submits to council strategies, procedures, consultative mechanisms, etc. to include citizens, other parts of council, central ministries and agencies, and other stakeholders. The board of governors also reports to all ordinary meetings of council on obligatory functions, permissive functions, 3- and 5-year investment plans, annual budgets and medium-term expenditure frameworks, financial status, and by-laws. The board of governors consults closely with the technical facilitation committee to ensure activities of all levels of government are well coordinated. Additional roles of the board of governors include advice to council and the MOI on complaints and abuses of power, the work of committees, transparent information dissemination, and ensuring citizens have access to information. The MOI may propose a sub decree setting out roles, duties, procedures, etc. of the board of governors. Chapter 4. Personnel and Units of the Council

Section 1. Personnel of the Council All councils can employ and deploy personnel who come under the direct management and supervision of the board of governors. Council personnel do not include regional staff of central ministries and agencies or those provided by the central government for security and public and social order, laws, and human rights. Personnel are to be appointed, in line with legal provisions for personnel of subnational administrations, by transparent competition keeping geographic balance in mind. The council decides on appointment conditions but in line with standardized personnel provisions for subnational administrations. Personnel are responsible to their immediate superior for carrying out decisions of the council and the board of governors, and are indirectly responsible to the administration director, the governor, board of governors, and the council. All councils must have a chief of finance appointed by the council with approval of the MEF and on advice of the MOI. The chief of finance is responsible for financial management and procurement and ensuring proper audit occurs. All district councils have a commune support unit headed by a chief in line with organizational and funding arrangements set by Prakas of the MOI.

Section 2. Administration Director All councils have an administration director appointed by the MOI with responsibility for managing administrative work of the council and the board of governors. This post reports directly to the council and the board of governors. The board of governors may delegate work to the administration director and take his or her advice and recommendations. The administration director ensures work performance of all work units including the finance unit, implements by-laws, participates in council meetings, and advises the council and board of governors. Procedures for appointment, roles, duties, etc. for this post shall be set out in a Prakas of the MOI.

Section 3. Units of the Council The council determines its own units but in line with a sub decree providing guidelines on functions, positions, etc. for units. Units come under the overall responsibility, supervision, and management of the board of governors on behalf of council, but are the direct responsibility of the unit chief who is directly responsible and accountable to the administration director. Chapter 5. Implementation Process

Section 1. National Committee for Democratic Development The National Committee for Democratic Development (NCDD) shall be established by royal decree on request of the prime minister following proposal of the MOI. The NCDD shall establish subcommittees on functions and resources, fiscal and financial affairs, and personnel of subnational administrations. Roles, duties, membership, etc. of the subcommittees are to be set by sub decree. The subcommittees shall consult widely before making recommendations to the NCDD. They may establish working groups. The NCDD shall have a secretariat located within the MOI in line with procedures in a sub decree. At a minimum, the NCDD must meet twice a month and can set its own internal rules. The NCDD shall review responsibilities and functions of ministries and agencies at all levels to identify functions to be transferred to subnational administrations. Identification and transfer is to be followed by transfer of resources (revenue powers, finance, personnel, assets, and capacity building), empowerment to get access to resources needed to manage assigned functions, and powers and duties to manage in line with local autonomy and accountability. Prior to transfer of functions, the NCDD should ensure central government ministries integrate their subnational plans and budgets into the relevant council plans and budgets. The NCDD is responsible for ensuring the law is implemented and that central ministries, agencies, and subnational administrations are aligned with policies and strategies. The NCDD should ensure other laws and legal instruments are amended to make them consistent with the Organic Law. The NCDD is to advise the government on inconsistencies in implementing the Organic Law, and resolve those issues. Subcommittees of the NCDD, councils, ministries, etc. must implement decisions of the NCDD and, where they fail to cooperate, the NCDD can report to the prime minister in the case of ministries and the MOI in the case of councils. The NCDD shall provide a progress report to the government every 6 months. The NCDD shall have its own budget as part of the budget of the MOI. It shall have medium- and long- term programs which will be updated annually. There shall be an annual work plan and budget to implement the National Program. There shall be an annual report on implementation progress. The NCDD can receive funding and support from development partners and other sources.

Section 2. Council Functions In the context of democratic development, councils at all levels shall effectively manage functions transferred to them. In reviewing functions for transfer from ministries, the NCDD shall give priority to issues relating to the following sectors: (i) agriculture; (ii) education; (iii) forestry, natural resources, and environment; (iv) health, nutrition, and services, including the needs of men, women, children, youth, vulnerable groups, and indigenous people; (v) industry and support to economic development; (vi) land use; (vii) electricity production and distribution; (viii) water management; (ix) infrastructure and facilities; and (x) special needs of particular subnational administrations including on tourism, historical sites, and cultural heritage. The review of functions to be transferred should take into consideration essential functions that impact poverty reduction and livelihood, and should identify responsibilities to be transferred to specific tiers of government and those that can reside with the central government. Reviews should ensure that transfer of functions is matched with resource transfers and that they are well planned, phased, and coordinated, and are transparent. Reviews of functions for transfer are to be based on the following principles: relevance to the jurisdiction of the council, manageability and practicality for councils, benefit and usefulness for residents, and provision of major impact within the council’s jurisdiction.

Section 3. Obligatory Functions Obligatory functions shall be defined by law, royal decree, sub decree, or other legal instrument based on requests of the NCDD, ministries, and agencies with clear definition of obligatory requirements (standards) and time frames for implementation. Where an obligatory function is fully transferred with resources, it is permanently assigned to the relevant tier of subnational administration. Where an ongoing permanent contribution of a central ministry is required, that function shall be delegated with the council accountable to the delegating ministry.

Section 4. Permissive Functions Permissive functions may be transferred to councils, who shall manage them based on capacity and resources transferred but may ask the NCDD to change or terminate the arrangement. All resources transferred for permissive functions shall be at the council’s discretion to manage in line with standards and procedures set out in laws, royal decrees, and sub decrees.

Section 5. Assignment and Delegation of Functions Both assignments and resources transferred shall be permanent, not temporary. Before the transfer of functions, the NCDD shall decide on resources required and capacity development needs of the recipient subnational administrations. The NCDD and ministries may assign or delegate functions to two or more councils with transferred resources to be shared among them. The NCDD, in consultation with ministries, can change the mix of assigned and delegated functions and also the mix of obligatory and permissive functions. Assignments and delegations shall be set out in laws, royal decrees, sub decrees, and other legal instruments. All existing laws, decrees, etc. shall be reviewed by the NCDD in relation to assignments and delegations and shall be made consistent with the Organic Law. The NCDD, in deciding on assignments and delegations, shall coordinate with ministries and agencies and ensure clarity as to the nature of the legal instrument, timing of changes, and whether changes are assigned or delegated. The NCDD shall broadly publicize to all tiers of government decisions on assignments and delegations.

Section 6. Financial Regime of Subnational Administrations Councils shall have budgets as set out in Section 2 of Chapter 2. Councils shall have sufficient financial resources to undertake agreed obligatory and permissive functions to cover administrative costs and legal requirements and to perform its duties towards democratic development. All finances are to be managed with accountability to the citizens and the central government. Councils have rights to receive revenues from local and national sources in line with the proposed subnational administration finance law and the existing Law on Public Finance Systems. Khan and Sangkat council budgets shall be included within the budgets of the capital and municipalities. The governor is the officially delegated signatory on behalf of the council. The board of governors is responsible for preparing the 5-year development plan, the 3-year investment plan, the annual budget, and the medium-term expenditure framework for approval. Procedures for preparing and implementing budgets shall be set out in the proposed subnational administration finance law and in the Law on Public Finance Systems. Local sources of revenues shall include (i) local taxes; (ii) fees, charges, and other nontax revenues; (iii) revenues of district councils to be shared between districts, communes, and sangkats; (iv) donations; and (v) others as per laws and legal instruments. Subnational administration revenues shall be established in a law within the framework of the proposed subnational administration finance law. National sources of revenues shall include shared revenues, national transfers, and agency fees from ministries, etc. Shares of revenues received from license issues, service fees and charges, and nontax revenues will be set out in the subnational administration finance law. Councils may receive national revenues on a conditional or nonconditional basis. Conditional funds shall be used for obligatory and permissive functions previously undertaken by a central ministry, and other obligatory functions. Unconditional transfers shall be used for performing legal duties, promoting deconcentration and decentralization, administrative costs, and permissive functions of the council’s own choice. Councils cannot borrow or issue bonds or guarantees or otherwise generate liabilities. In preparing the financial regime, the NCDD shall consult and coordinate with the MEF and other ministries to ensure effective planning.

Section 7. Asset Management of Subnational Administrations Assets include transferred state assets and own acquired assets. Transferred assets can be used and generate revenues but cannot be sold or transferred without agreement of the MOI and approval of the MEF. Procedures for managing all forms of assets shall be set out in the proposed law on subnational administration financial management. The NCDD shall consult and coordinate a phased and orderly transfer of state assets as part of the review and transfer of functions, and may decide that certain assets are shared by two or more councils. Where councils are assigned functions but have inadequate assets, they shall be provided with finance to acquire adequate assets. Legal documents or a formal NCDD decision shall clearly document assets transferred. Failure of a ministry to hand over assets or to document the handover shall be reported to the NCDD by the council. All councils shall prepare asset maintenance plans and fund maintenance through the annual budget and prepare and update an inventory of assets.

Section 8. Personnel The NCDD and ministries shall review and concurrently redeploy personnel in line with functional transfer decisions and consistent with a redeployment strategy. The NCDD shall determine categories of employees to be transferred, but within the constraint of hiring no new civil servants. Management of civil servants in subnational administrations will be in line with a new law to be developed. Redeployment principles should be consistent with the transfer of functions; be consultative, rational, and transparent; and take into account interests of councils and personnel affected. Where an existing function is transferred, personnel currently doing the work should also be transferred. Redeployments may involve individuals or categories of employees. Those redeployed should be no worse off in terms of duties, salaries, and conditions. Where resources are transferred without adequate employee numbers, financing should be provided. Where redeployment involves a change in location, personnel can object in writing within 1 month and may remain with their central ministry but must be provided with new duties. Redeployment comes into effect on formal notification of the NCDD and relevant ministries. The MEF shall transfer salary and other benefits from the outset. Councils shall inform the NCDD of any transferees who do not show up for work. Procedures to apply to redeployment are to be set out in a sub decree. Chapter 6. Punishment Councillors, boards of governors, staff, and others contravening this law are subject to administrative, civil, and criminal punishments as appropriate. Councillors are subject to punishments set out in Chapter 2,

Section 1 of this law. Others are subject to punishments set out in Chapter 3, Section 5 of this law and as per the Law on Civil Service and the proposed law on personnel of subnational administrations. Chapter 7. Transitional Provisions

Section 1. Transfer of Rights and Responsibilities Existing administrations will be replaced by councils at levels of capital, province, municipality, district, and khan. Governors at these levels will remain in place until new councils take over and new boards of governors are established. Appointments of new boards of governors shall occur within 14 days of results declaration of the first council elections. Existing by-laws, regulations, contracts, agreements, works, assets, revenues, and funds shall continue to be implemented by the new regime. Unit officers and personnel shall continue to work under the new regime until redeployment arrangements are finalized. The MOI shall determine and maintain records on all transfers and receipts of rights, obligations, assets, revenues, funds, and personnel.

Section 2. Commune and Sangkat Councils These councils shall continue to implement provisions under the 2001 law, except for Article 88 (Sections 6, 7, 8, and 9 of Chapter 2 providing some supervision powers to district governments) and the principles of Chapter 5 outlining implementation processes of this law. The NCDD shall prepare legal instruments to support communes and Sangkat to implement these provisions. Also, the NCDD will review the 2001 law and other legal instruments and prepare any consequential amendments arising from the deconcentration and decentralization principles set out in this law. Chapter 8. Final Provisions Any other legal provisions contradicted by this law shall be abrogated. The law is declared urgent.