F IVE casino companies and a consortium have expressed interest in the Royal Goverment's $500 million project to build a casino on Naga Island off Sihanoukville, a Tourism Ministry source said.

Two of the potential bidders are from Malaysia, one is from Australia's Gold Coast, one from Hong Kong, while the fifth is an international syndicate, the source said. He added that he was unable to name the companies and spoke after the Ministry officially announced Nov 21 as the closing date for bids to be submitted.

In a further development in the wake of the passage of the Investment Law through the National Assembly, the Ministry has announced a package of investment incentives and low tax measures to attract more interest in the project.

They include a 70-year licence and a 10-year exclusivity on casino operations in Cambodia including an interim right to operate a floating casino in Phnom Penh.

Tourism Minister Veng Sereyvuth said that the gaming tax has been set at 7 percent, the lowest in the region.

"The casino will have a tax free holiday of eight years and then, under the new Investment Law, a concessional tax rate of only 9 percent of corporate profits," he said.

There will be no tax on the distribution of dividends overseas or in Cambodia, and 100 percent import duty exemption on capital goods and construction materials.

The project is being offered for international tender through the Australian company Lewis and Partners.

Not only will the winning bidder be required to build a luxury resort conforming to the Royal Government's specifications but will also be required to spend up to $100 million on upgrading Sihanoukville airport to international standards.

The casino would be the first in Indochina, and would exclude Cambodians and target "foreigners only".

Cambodia is ideally positioned, claims Veng, to capture the high- roller gambler market, many of whom will come from Thailand, where gambling is illegal.

Currently Thai gamblers are flown free of charge to Burswood Casino in Perth, where they receive free accommodation. Some of the highest rollers are rumored to spend $1 million in a night.

In a glossy brochure inviting bids on the project Naga Island is described as "located in the centre of booming southeast Asia," and as having white sandy beaches and virgin jungle.

The Ministry of Tourism had invited journalists to visit the 100-hectare tropical paradise island on Sept 20. However the trip by private plane to Sihanoukville was later cancelled due to technical problems. It was not clear at press time if the trip was going to be rescheduled.