Strata Governance in Cambodia: Management Fees, Sinking Funds, and Who Runs Your Building

Every analysis on this site ends at the same cliff: the purchase completes, the title registers, and then you own a slice of a building for ten or twenty years — governed by documents most buyers never read, funded by fees most buyers never question, and run by a manager most buyers never chose. This is the guide to that long second act: what Cambodian law actually says about running a co-owned building, where it goes silent, and how to buy into the silence with your eyes open. Citations are marked [S-NNN]; the source list is at the end.

The legal skeleton: Sub-Decree 126

Cambodia’s strata governance framework is Sub-Decree No. 126 on the Management and Use of Co-Owned Buildings (August 2009) — the same instrument that makes foreign strata ownership administratively real. Its load-bearing provisions [S-165]:

• Common areas are the undivided property of all co-owners (Art. 14): the ground, courtyards and access ways, the structure and walls, roofs, and the water, electrical and sewer systems even where they cross private units (Art. 12). You own a share of the pipes in your neighbour’s wall.
• Everyone pays, by value: all owners are jointly responsible for common-area maintenance, with each owner’s share proportional to the value of their lot unless the internal regulations set another formula (Art. 14) — the legal anchor under every fee schedule.
• Use, not control: each co-owner holds only a use right over common areas — with a pointed example: the top-floor owner may not build on the roof or sell the right to (Art. 12). Encroaching on or privatising common areas obliges restoration and triggers Land Law penalties (Art. 25).
• Your unit is yours — to sell, rent, mortgage, or bequeath (Arts. 10–11), provided you don’t damage the building’s solidity or appearance; transfers must be processed by the cadastre within 20 working days (Art. 20).

The document you already own and never read

Here is the detail that should change buyer behaviour: the internal regulations — the building’s constitution, covering owners’ rights and obligations, common-area use, management organisation, and how expenses are shared — must be issued before the developer may even announce units for sale, and they are required by the Land Office to register the building and issue the strata titles [S-166] [S-165]. Older buildings had to prepare them (to a minimum content in the sub-decree’s annex) before registration too (Art. 23) [S-165].

Translation: if your unit has a real strata title, the internal regulations exist, on file, as part of the paperwork that produced your certificate. Ask for them at the same moment you verify the title — a seller or manager who cannot produce the building’s founding document is a due-diligence finding, not an inconvenience.

Who runs the building — law versus lobby

The sub-decree requires a management board or executive committee for the building, but — as the law firms reviewing it have noted — it specifies neither when the body must be formed nor how it may delegate, leaving co-owners free to organise management as their internal regulations provide [S-166]. That flexibility has a predictable equilibrium in an investor-heavy market:

• The developer’s affiliated manager runs the building from handover — legitimately, since someone must — and continues indefinitely, because forming a co-owners’ board requires the one thing absentee investors don’t supply: presence.
• The 70% foreign quota compounds it. A building sold largely to offshore investors is a building whose electorate lives in other time zones. No quorum, no board; no board, no counterweight to the manager’s budget, contracts, or fee increases — the dynamic our property-management guide approaches from the unit level.

None of this makes developer-affiliated management bad — continuity has value, and a good operator protects the asset. It makes it unaccountable by default, and the difference between those words is a functioning co-owners’ assembly.

The money: fees

Phnom Penh management fees in 2025 run $1.00–2.00 per square metre per month, typically collected quarterly or annually, covering security, cleaning, and common-area maintenance [S-167]. Two diligence points beat any headline rate:

1. Net or gross? Buildings bill on interior area or on your share of common space included — a difference worth 20% or more on the same unit [S-167]. Know which yours uses before comparing fees between buildings — or underwriting a yield.
2. Against what budget? A fee is a price; the question is what it buys. The legal default apportionment is by lot value (Art. 14) [S-165], but the internal regulations can vary it — another reason to read them.

The money: sinking funds, or the decade problem

Here the law goes quiet and the market improvises. Sub-Decree 126 mandates joint responsibility for maintenance but no reserve fund, no contribution rate, no audit, no trustee. Market practice is a one-time sinking-fund contribution at handover of roughly $1 per square metre [S-167] — call it $70 on a typical one-bedroom.

Do the arithmetic that most buildings haven’t: repainting a tower, replacing lift motors, re-waterproofing a roof — the year-10 capital works — cost orders of magnitude more than a one-time $1/sqm pot. A building with no ongoing reserve contributions meets that decade one of three ways: a special levy on owners (legal under the joint-responsibility rule, ugly in practice), deferral and decay (visible all over the region’s older stock), or a rebuild negotiation the sub-decree only sketches (repair costs shared by lot value, Art. 15) [S-165]. When you tour a resale building, the lobby’s condition is the sinking fund’s financial statement.

The governance file: what to collect before you buy

Add a governance layer to the standard checklist — at handover for a new build, before the deposit on a resale:

• The internal regulations — they exist if the titles do [S-165] [S-166]; read the fee formula, the use rules (including any short-term-rental position), and the management provisions.
• The fee schedule — rate, billing area (net/gross), payment cycle [S-167].
• The sinking-fund position — balance, contribution history, any levy history.
• The master insurance policy — the building’s, not yours; our insurance guide covers the two-policy split and why Article 79 liability makes it matter.
• Evidence of a co-owners’ body — minutes, an elected board, anything. Its absence after years of occupancy tells you who really runs the building.

The takeaway

Cambodian strata law is better than its reputation and thinner than its job. Sub-Decree 126 genuinely delivers the foundations — undivided common ownership, value-proportional cost sharing, internal regulations welded to the title-registration process, a required management body — and then declines to police the part where buildings live or die: reserves, audits, and the transfer of power from developer to owners. The result is a market where governance quality is set building by building, which for a buyer is actually good news in one narrow sense: it is checkable. The internal regulations are on file, the fee basis is in writing, the sinking fund has a number, and the lobby tells the truth. Collect that file before the money moves — because after handover, you are not just an owner; you are a citizen of a very small country whose constitution you should have read. None of this is legal advice; internal regulations differ materially by building, so have a qualified Cambodian lawyer review the specific documents before you rely on them.

Sources

• [S-165] Sub-Decree No. 126 on the Management and Use of Co-Owned Buildings (12 August 2009) — official English translation — Arts. 10–12 (private-unit rights; common areas incl. systems crossing private units; use-only rights; top-floor rule), Art. 14 (undivided ownership; joint maintenance responsibility, cost shares proportional to lot value unless internal regulations vary), Art. 15 (repair/rebuild cost sharing), Arts. 16–20 (MLMUPC registration requiring internal regulations; 20-working-day transfers), Art. 23 (pre-existing buildings), Art. 25 (common-area infringement penalties).
• [S-166] Realestate.com.kh — Condominium Law in Cambodia: Two Things Investors Must Review — internal regulations required before announcing sales and by the Land Office for registration/title issuance; scope (rights/obligations, common-area use, management organisation, expense sharing); management board/committee required with timing and delegation unspecified; the case for professional management.
• [S-167] IPS Cambodia — The True Cost of Ownership: What You Actually Pay for a Condo in Cambodia — 2025 Phnom Penh management fees $1.00–2.00/sqm/month, quarterly/annual billing; net-vs-gross billing impact of 20%+; one-time sinking-fund contribution ≈$1/sqm at completion; utilities and the 6–10% ownership-cost budget rule.