SPA contract in Cambodia: what to check before signing

Prepared by the NovAsia Editorial Team

A Sale and Purchase Agreement, usually shortened to SPA, is the main contract between a property buyer and seller in Cambodia. It should identify the unit being purchased, state how much and when the buyer must pay, set out the handover process, describe the title the buyer is expected to receive, and explain what happens if either party fails to perform.

An SPA is not the same as registered ownership. Cambodian land law links the transfer of an enforceable property right to the required legal form and cadastral registration. In an off-plan purchase, the SPA first gives the buyer a contractual claim against the developer. The strata title is normally issued later.

The central risk is an agreement that imposes detailed penalties on the buyer for late payment while giving the developer little or no meaningful liability for delay, area changes, defects or failure to deliver the promised title.

What an SPA does—and does not do automatically

For an off-plan property, the buyer’s protection depends on the wording of the SPA, the project documents and the developer’s ability to perform.

Before the SPA: the booking form

Buyers often sign a booking or reservation form and pay a deposit before receiving the full SPA. This document may already have financial consequences.

Before paying, check:

• the unit number;
• the agreed price;
• how long the reservation remains valid;
• when the SPA will be provided;
• whether the booking fee is credited toward the purchase price;
• whether it is refundable if due diligence is unsatisfactory;
• what happens if the parties cannot agree the SPA;
• the refund deadline;
• the legal entity receiving the money.

A non-refundable reservation paid before the buyer has seen the SPA and core project documents creates unnecessary leverage for the seller.

Parties and authority

The SPA must identify the seller and buyer precisely.

For the seller, verify:

• full legal name;
• company registration number;
• registered address;
• connection to the project;
• authority of the signatory;
• legal right to sell the selected unit;
• relationship with the landowner.

If the project is marketed under one brand, the SPA is signed by a second company and payments go to a third, the structure should be explained and supported by documents.

The buyer’s name should match the passport exactly. Transliteration errors and incorrect passport details are easier to correct before signing than during title registration.

Precise description of the property

The SPA should identify the apartment without relying on a brochure or sales presentation.

It should include:

• project name;
• tower or building;
• unit number;
• floor;
• permitted use;
• layout;
• stated area;
• balcony, if included;
• parking, if included;
• furniture and appliances;
• an attached floor plan.

For a foreign buyer, the legal floor numbering should confirm that the unit is above the ground floor and eligible for foreign ownership.

A clause allowing the seller to substitute a “similar unit at its discretion” should not permit replacement without the buyer’s written consent.

Net area, gross area and price adjustment

The SPA should explain which area is used to calculate the price and how the final area will be measured after construction.

Net area usually refers to the internal usable floor area.

Gross area may include walls, balconies and a share of common areas.

Check:

1. Which area is stated in the contract.
2. Who performs the final measurement.
3. What tolerance is permitted.
4. Whether the price is adjusted up and down.
5. Whether the buyer may terminate if the difference is material.

Example

The agreed price is $1,700 per square metre and the contractual area is 60 square metres.

If the contract allows the developer to reduce the area without refunding part of the price, the effective price per square metre rises. A balanced clause should provide a symmetrical adjustment and a right to withdraw if the difference exceeds an agreed threshold.

Price and additional costs

The SPA should state one total purchase price and identify everything excluded from it.

Clarify separately:

• stamp duty;
• cadastral and registration fees;
• strata-title issuance costs;
• banking charges;
• furniture;
• parking;
• sinking fund;
• service charge;
• utility connection fees;
• management costs.

The phrase “all-inclusive” should be defined line by line. Any discount should appear in the SPA or in a signed appendix, not only in an email or sales chat.

Payment schedule

The schedule should state the amount, currency, due date, bank details and legal basis for every payment.

A schedule under which almost the entire price is paid long before completion and inspection transfers substantial project risk to the buyer.

If instalments are linked to construction milestones, the contract should state who certifies that each milestone has been reached.

Buyer default

SPAs often describe buyer default in considerable detail, including:

• late-payment interest or penalties;
• notice requirements;
• cure period;
• termination;
• forfeiture of payments;
• resale of the unit.

The sequence matters. The buyer should know exactly when a breach occurs, when notice must be given, how long the cure period lasts and how much money is returned after termination.

A clause allowing the seller to keep all payments and resell the property after a short delay should be amended or reviewed independently by a Cambodian lawyer.

Completion and handover dates

The SPA should define:

• target completion date;
• contractual grace period;
• long-stop date;
• notice of readiness;
• technical inspection;
• key handover;
• the date service charges begin;
• the timetable for strata-title application.

A grace period can be a normal part of a construction contract. It should not become an unlimited extension. Once it expires, meaningful remedies should apply.

Developer liability for delay

The parties’ obligations should be reasonably balanced.

If the buyer pays a substantial penalty for late instalments while the developer can delay completion without financial consequence, the contract is asymmetrical.

Possible buyer protections include:

• delay compensation;
• interest on paid amounts;
• a right to suspend further instalments;
• termination after the long-stop date;
• repayment of all money paid;
• a fixed refund deadline.

Example

The buyer has paid $50,000 and the project is delayed by one year beyond the grace period.

A termination right is weak if the contract does not specify when the refund must be made and what happens if that deadline is missed.

Force majeure

Force majeure should cover events genuinely outside a party’s reasonable control.

Review:

• the list of qualifying events;
• notice deadline;
• evidence required;
• duty to mitigate the impact;
• maximum extension;
• termination right if the event continues for too long.

A lack of finance, weak sales, rising material costs or internal contractor problems should not automatically be treated as force majeure.

Changes to the project

A developer needs reasonable flexibility to make technical adjustments. It should not have an unrestricted right to redesign the project.

A clause stating that the seller may change the project “at its sole discretion” should be narrowed.

Finishes, furniture and appliances

A rendering or show unit is not a contractual specification unless it is incorporated into the SPA.

The contract or appendix should identify:

• flooring;
• windows and doors;
• sanitary fittings;
• kitchen units;
• air-conditioning;
• built-in furniture;
• appliances;
• quantities;
• permitted alternatives.

The wording “or equivalent” should mean comparable quality, not a materially cheaper replacement.

Inspection and defect list

The SPA should state:

1. How notice of inspection is delivered.
2. How many days the buyer has to inspect.
3. Whether the buyer may appoint a representative or engineer.
4. How defects are recorded.
5. The deadline for rectification.
6. Whether a second inspection is available.
7. How disagreements are resolved.

Do not assume that a familiar international defect-liability period applies automatically. The duration and procedure should be written into the SPA or a separate warranty document.

The buyer should not sign a defect-free handover acknowledgement before checking water supply, electricity, air-conditioning, windows, doors, finishes, furniture and appliances.

Final payment

The buyer is better protected when the final payment is linked to objective conditions, such as:

• completion of the project;
• readiness of the unit;
• an inspection opportunity;
• preparation of the defect list;
• the seller’s readiness to transfer possession;
• delivery of required documents.

A clause requiring the final balance solely because the seller issued a unilateral “ready for handover” notice creates additional risk.

Strata title

The SPA should promise a specific ownership structure and define what the seller must do to register it.

Confirm:

• eligibility of the unit as a private unit;
• availability of foreign quota;
• obligation to obtain and transfer title;
• filing deadline;
• allocation of costs;
• treatment of encumbrances;
• remedy if registration is impossible;
• delivery of the original title document.

The SPA itself does not replace cadastral registration. A clause saying “ownership transfers upon full payment” should reflect the actual title-registration process rather than creating a misleading impression.

Assignment before title registration

If the buyer may want to sell before the final title is issued, the SPA needs an assignment clause.

Check:

• whether the developer’s consent is required;
• whether consent may be withheld without reason;
• the assignment fee;
• whether discounts, GRR and buyback rights transfer;
• who remains liable for earlier payments;
• when the new buyer becomes a party to the SPA.

A complete prohibition on assignment can lock the buyer into the payment schedule until the project is finished.

Termination and refunds

The SPA should deal separately with:

• voluntary withdrawal by the buyer;
• buyer breach;
• seller breach;
• notice procedure;
• amount forfeited;
• refund of the balance;
• refund deadline;
• interest or penalties.

Material seller breaches may include prolonged delay, inability to deliver the unit, substantial reduction in area or failure to provide the promised title.

A clause making refund without interest the buyer’s sole remedy may be inadequate where the seller held the buyer’s capital for several years.

GRR and buyback clauses

If the project offers guaranteed rental return or a repurchase programme, the complete terms should appear in the signed SPA or an enforceable appendix.

Verify:

• the obligated legal entity;
• percentage and calculation base;
• commencement date;
• payment schedule;
• meaning of “net”;
• tax treatment;
• notice deadline;
• repurchase price;
• title-transfer mechanics;
• remedies for default.

A brochure does not create a contractual obligation.

Governing law and disputes

The SPA should state:

• governing law;
• court or arbitration forum;
• seat or location of proceedings;
• contract language;
• notice procedure;
• allocation of legal costs.

Foreign arbitration is not automatically stronger protection. The buyer must consider the cost of the proceeding and whether an award can be enforced against the seller’s assets.

Contract language

For a bilingual SPA, confirm:

• which version prevails;
• whether clause numbering matches;
• whether both versions are signed;
• who prepared the translation.

A buyer should not sign a Khmer version without receiving an independent explanation of its effect.

Signing and originals

For a remote purchase, establish in advance:

• whether a scan is sufficient initially;
• whether original signatures are required;
• whether notarisation or legalisation is needed;
• how many originals will be signed;
• when the countersigned copy will be returned;
• whether a representative may sign under power of attorney.

Only the final version should be signed, with every appendix attached. Blank pages and promises to provide specifications later are unacceptable.

Stress-test the SPA

If the contract does not produce a clear result in each scenario, the economic risk remains with the buyer.

Red flags

Pause or renegotiate the transaction when:

• the unit is described without a number or plan;
• area can change without a price adjustment;
• the seller may alter the project freely;
• there is no long-stop date;
• buyer and seller liability are seriously unbalanced;
• force majeure includes financing problems;
• final payment is due before inspection;
• no defect-liability procedure exists;
• strata title is promised without a deadline;
• refunds have no payment deadline;
• assignment is completely prohibited;
• appendices will only be supplied after signature.

Pre-signing checklist

1. Parties and authority.
2. Unit number and attached plan.
3. Area definition and measurement method.
4. Total purchase price.
5. Additional charges.
6. Payment schedule.
7. Buyer grace period.
8. Completion and long-stop dates.
9. Developer liability for delay.
10. Limits on project changes.
11. Finish and furniture specification.
12. Inspection procedure.
13. Defect liability.
14. Conditions for final payment.
15. Strata-title timetable.
16. Assignment rights.
17. Termination and refund procedure.
18. GRR or buyback terms.
19. Language, governing law and disputes.
20. All schedules and appendices.

Conclusion

An SPA is not a routine formality completed after choosing an apartment. It is the primary document allocating risk between the buyer and developer.

A well-drafted agreement precisely identifies the unit, explains area and total cost, sets an enforceable outer completion date, balances the parties’ liability, establishes inspection and defect procedures, and provides a clear path to strata title.

The clauses requiring the closest attention are the developer’s right to change the project, consequences of delay, timing of final payment, refund mechanics and assignment rights.

Until title is registered, the buyer relies heavily on the developer’s contractual performance. The SPA should therefore be reviewed together with the company, land and project documents.

This article is for general information only and does not replace advice from an independent Cambodian lawyer. The final SPA, every appendix and the Khmer-language version should be reviewed for the specific project before any non-refundable payment is made.

For a preliminary review of an SPA for a Phnom Penh property, provide NovAsia Estate with the agreement and its appendices so the commercial terms and key risks can be identified before signature.

Sources

1. Land Law of Cambodia 2001, Articles 64–69.
2. Civil Code of Cambodia and Law on Implementation of the Civil Code.
3. Law on Consumer Protection 2019.
4. Ministry of Commerce Prakas No. 0067 on Unfair Contract Clauses, 1 March 2022.
5. Law on Construction 2019.

Frequently asked

What is an SPA when buying property in Cambodia?

The SPA (Sale and Purchase Agreement) is the contract between the buyer and the developer. It sets out the price, payment schedule, handover dates, the obligations of each side and the terms for transferring ownership. It is the main document of the deal, and its terms define your rights.

What must I check in an SPA before signing?

The exact description of the unit and its area, the price and payment schedule, the handover deadline and the developer's liability for delay, the terms and timing of strata title issuance, the conditions of guaranteed rent and buy-back (if any), and the cancellation terms. Any verbal promises must be reflected in the contract.

Do I need a lawyer to review the SPA?

The contract involves a large sum and long-term obligations, so an independent legal review before signing reduces risk. This is especially important for a remote purchase and a first deal abroad.