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KINGDOM OF CAMBODIA Nation - Religion - King

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ROYAL GOVERNMENT OF CAMBODIA

SUB-DECREE ON Establishment of the Cambodian Reinsurance Company Cambodia Re


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The Royal Government


Having seen the Constitution of the Kingdom of Cambodia; Having seen the Royal Decree No. NS/RKT 1198/72 dated November 30t h, 1998, regarding the Formation of the Royal Government of Cambodia; Having seen the Royal Kram No. 02/NS/94 dated July 20 th, 1994, promulgating the Law On the Organization and Functioning of the Council of Ministers; Having seen the Royal Kram No. NS/RKM/0196/18 dated January 24th, 1996, promulgating the Law on the Creation of the Ministry of Economy and Finance; Having seen the Royal Kram CS/RKM/0696/03, dated June 17 th, 1996 on general provisions of public enterprise; Having seen the Royal Kram No. NS/RKM/0700/02 dated July 25th, 2000, promulgating the Law on Insurance; Having seen the Sub-Decree No. 41 ANKrBK, dated August 06 th, 1997 on implementing the Royal Kram of general provisions of the public enterprise; Having seen the Sub-Decree No. 42 ANKrBk, dated August 06th, 1997 on Accounting Commissioner Of General Enterprise; Having been approved by the Council of Ministers at the Plenary Meeting held on October 26 th, 2001.

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DECIDES
CHAPTER I General Provisions
Article 1: Having been established, as a state-run company named Cambodian Reinsurance Company, in short Cambodia Re, which was under the technical and financial tutel of Ministry of Economy and Finance. Cambodia Re is situated in Phnom Penh at Building N 28, corner street of 13 and 106, Sangkat Wat Phnom, Khan Daun Penh. Cambodia Re is an autonomous legal entity in terms of technical, administrative, and financial management. Cambodia Re is under the regulatory influence of this Sub -Decree, and has to comply with the law provisions on general provisions of public enterprise. Article 2: Cambodia Re has objectives and duties as follows: 1. To carry out reinsurance business operation of all class of risks, including general insurance and life insurance. 2. To act directly or indirectly related to Reinsurance business. 3. To fully cooperate with the existing or prospective enterprises or companies by way of sharing participation, signing commercial contracts, buying shares, which are beneficial to the company. 4. To directly or indirectly participate all industrial, commercial, financial, movable and immovable transactions related to companys objectives or facilitating the achievement and progress of the above -transactions. 5. To be responsible for job safety and security. 6. To adhere to the working principles and manner as the businesspeople do.. 7. To effectively manage all activities. 8. To have rights and duties provided by the state to achieve its planned objectives.

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Article 3: Cambodia Re has to follow the tax regulation set by the law and existing regulation. Article 4: The initial of Cambodia Res capital was defined by the initial balance with the consent from the Ministry of Economy and Finance. When this Sub -Decree was taken into effect, Cambodia Re is considered as a legal owner on behalf of the state on all assets given and recorded by the state in their inventory. Article 5: Cambodia Re employees were recruited from the civil servants of public work of the Ministry of Economy and Finance, and from outside if necessary. Cambodia Re staff was under the supervision of separate statute approved by the Boards of Director members.

CHAPTER II
THE MANAGEMENT
Article 6: Cambodia Re shall be supervised by the Board of Directors which have the full power to fulfill their duties in the regulatory frameworks of these Sub-Decree and its own statute. Board of Directors Members Consist of: - A representative from the Ministry of Economy and Finance - Chairman - A representative from the Cabinet of the Council Ministers Member - A representative from the Ministry of Justice-Member - Cambodia Re General Director Member - A representative of Cambodia Re employees-Member - A representative from Asian Insurance International-Member It is further agreed that Asian Insurance International shall have their own two members to be appointed on the Board of Cambodia Re. Article 7: Boards of Director Members from Cambodia Re were selected among the active officials who have working experience at least 5 years or dignitaries who is below 65 years old and must be a Khmer citizen who have sufficient working experience, with high level of economic, legislative or commercial skills, and have never been Khmer committed any offences.

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Board Members were appointed by a Sub-Decree, mandated for 3 years. This mandate can be terminated and renewed upon request of the Minister of Ministry or authority for which he/she represents. Board members were appointed by a Sub-Decree mandated for 3 years. This mandate can be terminated and renewed upon request of the Ministry or the authority for which he/she represents. Asian Insurance International shall elect their own representative to sit on the Board of Directors, and formally submit a letter to their own Insurance commissioner for information. If needed, the chairman of the Board of Directors may require a copy of the letter with an endorsement from their commissioner. Asian Insurance International shall serve the right to keep or change their own representative. Employee representative was elected by the votes of Cambodia Re employees. Article 8: Board members have a full legal rights for decision-making, issuing all letters and documents related to companys objectives in the name of Cambodia Re.` Duties of the Boards of Director Members are as follows: 1. To approve the business plan as stated in article 17 of this SubDecree. 2. To evaluate plans from time to time, to project outcomes and to take measure in order to readjust the issues accordingly. 3. To approve Annual Financial Statement and Balance Sheet and Economic Statement of Cambodia Re. 4. To approve the General Directors proposals, the management structure, company's internal regulation, the statute, salary scale, reward and bonus for employees in accordance with existing law regulations. 5. To approve contrac ts and treaties for which Cambodia Re is a signatory according to the terms and conditions stipulated in the existing rules. 6. To approve the companys proposal on investment of surplus capital.

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7. To approve the purchase, the changing or selling company's asse ts and borrowing proposal with or without mortgage or guaranties on company's assets. Article 9: Boards of Director may, through the invitation letter from the chairperson, convene a meeting at any time depending on the interest of the Company, or by a proposal signed by at least 4 of the members of the Board, One of which is a representative from Asian Insurance International Meeting of the Board must, however, take place at least once per 3 months. In the absence of the chairman, a senior of the members present shall be elected to manage to vote for the meeting chairperson. The Board shall discuss all issues relevant to its responsibilities. The meeting agenda and related documents shall be provided to all members and State Control Official at least 10 d ays prior to the meeting. The meeting shall be conducted so long as four voting members are present. If there is a lack of quorum, the meeting will be postponed until 15 days later, and the meeting to be convened to discuss the same agenda. This last meeting does not need a full quorum. All Board decisions are officially recognized only if approved by a simple majority of the meeting participants. In case of a tied voted, then the voice of the chairman or the meeting chairman's shall predominate. Article 10: The Board Meeting decision shall be recorded in the minutes of the meeting which will be submitted to the Ministries Concerned for which each member present, and a state control official, The other institutions mentioned in article 23 of this Sub-Decree no later than 15 days after the meeting. One copy of the minute must be sent to Asian Insurance International as well. The minutes of the meeting shall be approved by the Board of Directors in the next meeting, and recorded to the book with chronological page number and with proper code number. The original minute of the meeting must be signed by the meeting chairperson together with any Board Members present and a secretary appointed by the Director General.

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Article 11: The Director General shall perform the necessary duties for the management of the regular works of Cambodia Re, be responsible to activate and implement the business plan approved by the Board. This post shall be mandated for 3 years term by the Board in joint venture set up. Article 12: The Board shall delegate the necessary power to the Director General for day-to-day operation, and in order to have sufficient authority to manage the Company, in accordance with the law, representing the Cambodia Re before the court. In this framework, the Director General shall: 1. Prepare and submit documents to the Board, and implement all Board decisions and periodically report to the Board on Cambodia Re activities. 2. 3. Manage Cambodia Re in terms of its administration, technical, production, services and finance. Have the rights to recruit, nominate, revoke functions, dismiss and control all employees of Cambodia Re in compliance with the Statute of the Personnel or the existing law, and the Board decisions. 4. Have the rights to delegate partial or full power, including authority for signature to subordinated officials in accordance with the terms defined by the Boards. 5. Be the Cambodia Re representative in courts of law and all levels of tribunal in the case of Cambodia Re defense against any actions and contests. Article 13: Remuneration of the Board and allowances for the Director General shall be defined by the Ministry of Economy and Finance on proposal from the Board. Article 14: Entering into and implementing the contract by Cambodia Re shall be in accordance with the procedures defined by the Company's statute and the existing law.

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CHAPTER 3
FINANCIAL CONTROL
Article 15: Cambodia Re shall manage its own accounting in accordance with the International Standards being a reinsurance outfit Accounting period commences from the 1st January and ends on 31st December of the same year. The Financial Statement and managerial account shall be defined by the Board before 30th March of the following accounting period. The Financial Statement and the Managerial Account shall be submitted for approval from the Board of Director. Article 16: On 1st October of every year, the Board of Directors shall give an approval and adoption of the Business Plan of Cambodia Re proposed by the Director General. Article 17: The capitals of Cambodia Re are as follows: - Capital funded by the State (initial deposit), - Additional capital provided by the State, - Additional Capital funded by Asian Insurance International - Other revenues from Cambodia Re business transactions, - Revenues from selling or leasing Cambodia Re's fixed and movable assets, - Revenues from loan or donations. Article 18: Cambodia Re expenses are: - Current expenses for operations, - Expenses on investments, - Expenses on debt payments, - Miscellaneous expenses. Article 19: Cambodia Re opens its accounts in any commercial banks and uses it for the needs. Article 20: The Board of Directors can pay only debts which are approved in advance. Article 21: Within 15 days at the latest after approval of the Board of Directors, Cambodia Re shall have to submit to the Board of Directors the following documents: - Minutes of the Board Meeting, - Cambodia Re Business Plan, - Report on activities, finance and management account of Cambodia Re. Article 22: One State Control Official shall be nominated to be assigned to the Cambodia Re by the Sub -Decree on the Minister of Economy and Finance's proposal. The State Control Official has the rights to participate in all meeting of the Board and to share ideas on every agenda items, but has no voting power. The State Control Official shall perform duty accordingly to the provisions of article 20 to 25 of the Royal Kram No. CHS/RKM/0696/03 dated 17 th June 1996, regarding to the general provisions of the public enterprises.

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CHAPTER IV
FINANCIAL PROVISION
Article 23: Any provisions contrary to this Sub -Decree shall be null and void. Article 24: The Minister in charge of the Council of Ministers, the Minister of Economy and Finance, and the Ministers of Ministries, Secretary of State, and concerned institutions shall comply with this Sub -Decree from the date of signature onwards. Phnom Penh, January 24th, 2002 Prime Minister (Signed and Sealed) Hun Sen
Copied to - Ministry of Royal Palace - General Secretariat of Senate - General Secretariat of National Assembly - Cabinet of Samdech Prime Minister - Per Article 25 - Achieve-Chronology

Submitted to Samdech Prime Minister for Signature State Minister Minister of Economy and Finance (Signature) Keat Chhon

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