mm procedure for incorporating a company

7/25/2019 MM Procedure for Incorporating a Company

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Registering a Company in MyanmarAVAILABLE BUSINESS STRUCTURES

The following common entities are recognised and available for foreign investment/trade inMyanmar:

100% Foreign Equity:A foreign investor may:

Incorporate in Myanmar a 100 foreign!owned company

"stablish and operate as a registered branch of a company incorporated o#tside ofMyanmar

If an individ#al$ establish and operate as a sole proprietor

"stablish and operate as a 100 foreign owned partnership

In all of these cases$ 100 of the foreign capital for the enterprise m#st be provided by the

foreign investor%

Joint Venture:A foreign investor may:

Incorporate in Myanmar a &oint vent#re company

"stablish and operate #nder a contract#al/#nincorporated &oint vent#re 'ie a

partnership(%

All proposed &oint vent#res involving a )tate owned enterprise/the *overnment m#st be

s#bmitted to the Myanmar Investment Commission '+MIC+( and approved #nder the ,oreign

Investment -aw '+,I-+(% In all &oint vent#res approved #nder the ,I-$ the greater of . of the

e#ity capital or )2 00$000 m#st be contrib#ted by the foreign investor%

100% Loca Equity:A foreign entity may:

Appoint a b#siness representative/enter into an agency arrangement with a Myanmarciti3en or 100 Myanmar owned company

)ell to or b#y from a Myanmar citi3en/company

,or large scale pro&ects$ serio#s tho#ght sho#ld be given to investing #nder the ,I- which

provides significant ta4 and other incentives% 5owever$ s#ch investments m#st comply with a

rigoro#s set of criteria and may be s#b&ect to significant conditions% ,or smaller investments or

the foreign investor who does not wish to go thro#gh the ,I- proced#res there is an alternative


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way of doing b#siness in Myanmar$ #nder the Myanmar Companies Act and Reg#lations '+the

Companies Act+(%

INVESTIN! UN"ER #$AN#ARS F&REI!N INVEST#ENT LA'

Altho#gh not always possible or advisable to obtain a permit '+,I- 6ermit+( #nder the ,I-$ thebenefits attaching to investments #nder an ,I- 6ermit can be s#bstantial%

In addition$ for those foreign investors who do invest #nder the ,I-$ an ,I- 6ermit application

and relevant doc#ments addressing all areas appropriate to the proposed operations in

Myanmar 'incl#ding all other necessary approvals( can effectively provide a +one stop+ approval

process only dreamt abo#t in many other co#ntries in the region%

T(E FIL )ER#IT

A foreign investor wishing to invest in Myanmar #nder the ,I- m#st apply to the MIC in the

prescribed form and obtain an ,I- 6ermit$ being its permission to #nderta7e the proposedinvestment% The *overnment8s main foreign investment policy ob&ectives$ which will be

considered when appraising an ,I- 6ermit application$ are:

Adoption of a mar7et oriented system for the allocation of reso#rces

"nco#ragement of private investment and entreprene#rial activity

9pening #p Myanmar8s economy to foreign trade and investment which incl#des:

o promotion and e4pansion of e4ports

o e4ploitation of nat#ral reso#rces which re#ire heavy investment

o ac#isition of high technology

o developing prod#ction and services ind#stries involving large capital

o creating local employment opport#nities

o developing of wor7s which wo#ld save energy cons#mption

o and regional development%

In order to provide more specific g#idance to potential foreign investors$ some ; types of

activities have been specified as open to foreign investors% The foreign investor may still apply

for and obtain an ,I- 6ermit for an economic activity not specified$ provided the foreign investor

can e4plain how the activity wo#ld be m#t#ally beneficial to Myanmar and the foreign investor%


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The ,I- 6ermit application and doc#mentation s#bmitted to and negotiations with the MIC

sho#ld cover all of the foreign investor8s needs 'in terms of incentives to be so#ght($ str#ct#ral

constraints to be addressed 'land +holding+ and foreign e4change iss#es$ for e4ample( and all

additional approvals and permits relevant to/re#ired by the foreign investor for the f#ll

implementation of the investment% An ,I- 6ermit will not alleviate the need to disc#ss the

proposed investment with the appropriate Ministries or other approval a#thorities$ b#t the iss#eof an ,I- 6ermit which addresses the other permits/approvals necessary sho#ld 'given that the

grant of the ,I- 6ermit m#st be approved by Cabinet( ens#re that the iss#e of s#ch other

permits/approvals is a mere formality%

FIL INCENTIVES

C#rrently$ a foreign investor 'whether investing thro#gh a &oint vent#re or a 100 owned entity(

man#fact#ring goods or providing services in Myanmar #nder an ,I- 6ermit will be granted an

e4emption from income ta4 for three consec#tive years$ incl#sive of the year of commencement$

and the investment is +g#aranteed+ against nationali3ation% The ,I- also g#arantees the right to

repatriate +the rightf#l entitlement of the foreign investor+ in foreign c#rrency after thetermination of the b#siness and entitles foreign employees of the company resident in Myanmar

to repatriate their savings%

In addition$ any one or more of the following incentives may be granted by the MIC to the

foreign investor which invests and operates #nder an ,I- 6ermit:

"4emption or relief from income ta4 on the profits of the b#siness 7ept in a reserve f#ndand reinvested in the b#siness within one '1( year after the reserve is made

Accelerated depreciation in respect of machinery$ e#ipment$ b#ilding or other capitalassets #sed in the b#siness$ at the rate approved by the MIC

Relief from ta4 on #p to 0 of the profits accr#ed from the e4port of goods prod#ced inMyanmar

The right to pay foreign employees8 income ta4 and ded#ct s#ch payments fromassessable income

The right to ded#ct from assessable income e4penses inc#rred in respect of necessaryresearch and development carried o#t within Myanmar

The ability to carry forward and set off losses #p to three '.( consec#tive years after theyear in which the loss is s#stained

"4emption or relief from c#stoms d#ty$ licensing re#irements and internal ta4es on theimport of machinery$ and components$ e#ipment$ instr#ments$ spare parts andmaterials #sed in the b#siness and deemed re#ired by the MIC d#ring the initialperiod/period of constr#ction


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"4emption or relief from c#stoms d#ty$ licensing re#irements and internal ta4es on theimport of raw materials imported within the first three years8 of commercial prod#ctionfollowing start #p/the completion of constr#ction%

The incentives act#ally granted by the MIC to the foreign investor are specified in the ,I- 6ermit

when iss#ed%

In addition to ta4 incentives$ foreign investors holding an ,I- 6ermit are entitled to +lease+ land

for #p to .0 years from the *overnment at reasonable rates 'see disc#ssion below #nder

+Investor Concerns+( and are e4empted from obtaining an import licence from the Ministry of

Trade for certain capital investment items and raw materials%

FIL RE*UIRE#ENTS

The foreign investor operating #nder an ,I- 6ermit m#st effect the appropriate prescribed

classes of ins#rance with Myanma Ins#rance at the level which Myanma Ins#rance determines%

C#rrently$ the +prescribed+ ins#rances are:

Machinery Ins#rance

,ire Ins#rance

Marine Ins#rance

6ersonal Accident 'ie 6#blic -iability( Ins#rance

In addition$ the MIC may iss#e the ,I- 6ermit s#b&ect to specific conditions as to the carrying on

of the b#siness%

CARR$IN! &N BUSINESS UN"ER T(E #$AN#AR C)ANIES ACT

The Companies Act governs the activities of both locally and foreign incorporated companies

wishing to carry on b#siness in Myanmar and is in a form similar to early A#stralian and "nglish

company law codes which were the fo#ndation of the c#rrent company law in those co#ntries%

T(E )ER#IT T& TRA"E

Any +,oreign Company+ see7ing to do b#siness in Myanmar 'even if approved #nder the ,I-(

m#st obtain a 86ermit to Trade8 '+CA 6ermit+( from the Ministry of


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C#rrently$ the application for a CA 6ermit is s#bmitted$ along with the application for

incorporation of the ,oreign Company$ to the Registrar of the Companies Registration 9ffice%

>here an ,I- 6ermit is being applied for$ the CA 6ermit application and company incorporation

steps are to be followed only after iss#ance of the ,I- 6ermit%

A CA 6ermit is valid for two years from the date of iss#e and is renewable%

Ca+ita Require,ent-

"very ,oreign Company granted a CA 6ermit is re#ired to bring into Myanmar in foreign

c#rrency e4changeable at the official rate 8Iss#ed and 6aid p Capital8 '+Capital+( in the amo#nt

specified by the Capital )tr#ct#re Committee of the Ministry of


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A foreign investor wishing to carry on b#siness in Myanmar thro#gh a locally incorporated

limited liability company m#st incorporate:

#nder the Myanmar Companies Act or

if the company involves a )tate!owned enterprise or the *overnment$ #nder the )pecialCompanies Act and be approved #nder the ,oreign Investment -aw%

Incorporations #nder the Companies Act are now divided into five categories:

Trading Companies

Constr#ction Companies

)ervices Companies

Ban7ing and ,inance Companies

5otel and To#rism Companies

It is no longer acceptable to incl#de a wide range of ob&ects in the Memorand#m of Association

of the proposed company% The ob&ects of the company m#st be limited to specific activities in

one of the categories referred to above% This leads to the e4traordinary conse#ence that a

separate company m#st be incorporated sho#ld a +man#fact#ring+ company wish to also

engage in the retail sale of its prod#cts%

Incorporation fees range from a minim#m of ?s E00 #p to a ma4im#m fee of ?s 1$000 'payable

at the official e4change rate(%

C)AN$ RE*UIRE#ENTS

,oreign Companies in Myanmar are +re#ired+ to remain solvent$ the domestic debts and other

liabilities of the locally incorporated ,oreign Company are not to e4ceed the amo#nt of Capital

and the domestic debt/e#ity ratio is not to e4ceed 1:F%

A ,oreign Company incorporated in Myanmar m#st:

'a( appoint an a#ditor soon after incorporation

'b( hold its first ann#al general meeting within 1; months of incorporation

'c( file with the 9ffice of the Registrar of Companies Registration an ann#al ret#rn within F1

days of the company8s ann#al general meeting$ which ret#rn is to incl#de:

'i( a list of members and directors


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'ii( details of the capital str#ct#re of the company

'iii( mortgages and

'iv( a certificate to the effect that the company has not iss#ed any invitation to the p#blic to

s#bscribe for shares

'd( 7eep proper boo7s of acco#nt and stat#tory records 's#ch as Registers of members$

shareholders$ share transfers$ directors$ mortgages$ charges and etc( and

'e( present the company8s a#dited financial statements 'in the prescribed form( for each

acco#nting period to the members at the company8s ann#al general meeting%

"EALIN! 'IT( STATE&'NE" EC&NIC ENTER)RISES

Myanmar8s private sector is still developing and foreign investors wishing to enter into a &oint

vent#re may be #nable to find s#itable local private b#siness partners% ,oreign investors mayenter into a &oint vent#re 'or contract( with a )tate!owned economic enterprise '+)""+(%

)""s are formed as corporate bodies #nder +Acts+ or +-aws+ of the )tate or here appropriate$ the following additional approvals/permits will be re#ired by the ,oreign

Company%

J&INT VENTURES

Goint vent#re ,oreign Companies formed with local private citi3ens/entities which have obtainedapproval/concessions #nder the Myanmar Citi3ens Investment -aw 1DD '+CI-+( m#st obtain$

prior to formation$ an ,I- 6ermit% ,ail#re to obtain an ,I- 6ermit in these circ#mstances will

breach the provisions of the CI- and will e4pose the company 'and each of the shareholders( to

the possibility of fines and$ more importantly$ of being blac7listed from any *overnment approval

for any f#t#re b#siness vent#re in Myanmar% The activities for which approval/concessions may

be so#ght by a local private citi3en/entity #nder the CI- are:


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Agricuture

C#ltivating$ prod#cing and processing of agric#lt#ral and farm prod#ce%

"stablishing plantations for perennial crops$ prod#cing and processing their prod#ce%

Li2e-toc3 an4 Fi-/erie-

Breeding and farming of livestoc7 and processing of livestoc7 prod#cts%

Breeding$ fishing and processing of fish$ prawns and other a#atic organisms%

6rod#ction of animal feeds and veterinary medicines%

Fore-try

9perating plantations and prod#ction of timber$ bamboo$ cane/rattan and other forestprod#ce which are permitted by the )tate%

#ining

,easibility st#dies$ e4ploration$ e4ploitation$ prod#ction$ enrichment and processing ofmetallic minerals$ non!metallic ind#strial minerals$ #arry prod#cts$ gems$ pearls and

&ewellery which are permitted by the )tate%

In4u-try

6rod#ction$ processing and preserving of agric#lt#ral crops$ meat$ fish$ fr#its$vegetables$ salt and salt prod#cts$ stationery and s#pplies and goods prod#ced fromrecycled waste and scrap%

Man#fact#ring of dairy prod#cts$ tobacco$ cigarettes$ alcohol$ soft drin7s$ fabrics$ made#p garments$ te and similar fibers$ leather$ artificial leather$ p#lp$ paper$ paperboards$chemicals$ r#bber$ synthetic r#bber$ plastic prod#cts$ basic metals$ non!metallicminerals$ electrical and electronic prod#cts$ wireless and telecomm#nication e#ipmentpermitted by the )tate$ pharmace#ticals$ medical e#ipment$ personal and ho#seholdgoods$ pac7ing and pac7aging goods$ constr#ction materials and all associated/similarprod#cts%

6rocessing and man#fact#re of raw materials for weaving$ spinning and vario#s 7inds ofyarn%

)awmilling and woodbased ind#stries 'tea7 not incl#ded(%

6rinting and p#blishing wor7s%

B#ilding and repairing of boats and ships and doc7yard services%


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Con-truction

Constr#ction and maintenance of b#ildings$ sale and leasing of same%

Repairing$ maintaining and managing the constr#ction wor7s%

Ser2ice-

5otels and to#rism%

5ospitals and health services%

Transportation wor7s permitted by the )tate%

9ther types of services%

Econo,ic Acti2itie- )ertaining to t/e State &5ne4 Econo,ic Enter+ri-e- La5

+Reserved+ economic activities which have been approved by the *overnment to be#nderta7en by the ,oreign Company 'see below #nder +"conomic Activities Reserved,or The *overnment+(%

EC&NIC ACTIVITIES 6RESERVE"6 F&R T(E !&VERN#ENT

A certificate will need to be obtained from the appropriate Ministry where the ,oreign Company

wishes to carry on any of the following +reserved+ activities:

"4traction and sale of tea7

"4ploration$ e4traction and sale of petrole#m$ nat#ral gas and prod#ction of by!prod#cts

"4ploration$ e4traction and e4port of pearls$ &ade and precio#s stones

Breeding and prod#ction of fish and prawns in fisheries

6ostal and telecomm#nication services

Air and railway transport services

Ban7ing and ins#rance services

Broadcasting and television services

"4ploration and e4traction of metals and e4port of same

"lectricity generating services


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Man#fact#re of prod#cts relating to sec#rity and defence which the *overnment hasprescribed by notification

>here the Ministry concerned considers that the proposed investment is covered by the ,I- 'ie

is a &oint vent#re with a )tate owned economic enterprise or falls #nder the Myanmar Citi3ens

Investment -aw($ the application will be forwarded to the MIC and the foreign investor will bere#ired to ma7e an application for an ,I- 6ermit in the prescribed form%

#ANUFACTURIN! ENTER)RISES

All private individ#als and entities 'whether 100 foreign owned or a &oint vent#re( cond#cting

an enterprise which prod#ces finished goods from raw materials #sing any form of power in any

b#ilding '+6I"s+( m#st apply for registration with the Ministry of Ind#stry


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The ta4/acco#nting year begins on April 1 and ends on March .1 and cannot be varied% All

acco#nts m#st be made #p to March .1 and ta4 ret#rns m#st be filed before G#ne .0 each year%

Myanmar has signed only one do#ble ta4ation treaty$ with the nited ?ingdom in 1D0$ granting

relief in relation to income and corporate ta4es only% Treaties with )ingapore$ Malaysia$ Thailand

and other regional A)"A< neighbo#rs are c#rrently being negotiated%

C&R)&RATI&N TA7

Resident companies 'incl#ding ,oreign Companies incorporated in Myanmar and companies

operating #nder an ,I- 6ermit( are ta4ed at the rate of .0 on world wide income% The

Myanmar income of


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IN"IVI"UAL INCE TA7

)alary income 'incl#ding the val#e of any benefits given to an employee( is ta4ed on a pay!as!

yo#!earn basis 'ded#cted and paid by the employer(% Residents 'incl#ding employees of

companies operating #nder an ,I- 6ermit and foreign employees resident in the co#ntry for

more than 1;0 days in a financial year( paid in ?yats are ta4ed at progressive ta4 rates from .to .0 and are entitled to the allowances / ded#ctions allowed to Myanmar citi3ens #nder the

ta4 laws% All citi3ens and foreign employees of companies operating #nder an ,I- 6ermit paid in

a foreign c#rrency or ,"C are ta4ed at the rate of 10 of their salary and the ta4 is payable in

the c#rrency in which the salary is earned% 9ther foreign employee residents paid in foreign

c#rrency or ,"C are ta4ed at the rate of 1 of their salary% Again$ ta4 is payable in the

c#rrency in which the salary is earned%

C#ERCIAL TA7

+Commercial ta4+ is an ad valorem +t#rnover ta4+ levied on a wide range of goods and services

s#pplied in Myanmar and on the importation of goods 'in addition to any c#stoms d#tiespayable(%

Ta4 rates on most imported and domestic goods range from 0 to F% with special goods

's#ch as cigarettes$ li#or$ oil and gems( s#b&ect to ta4 of between . and F0% Commercial

ta4 is payable on trading$ transport$ entertainment$ hotel and resta#rant services at rates of

between and .0%

Any b#siness may apply for relief from commercial ta4 for the initial period of operations and$ in

partic#lar relation to e4ports%

LAB&UR AN" E#)L&$#ENT

Altho#gh a ,oreign Company may employ foreign +e4perts and technicians+$ the *overnment

re#ires that preference be given to Myanmar citi3ens with e#ivalent #alifications%

Re#ired s7illed local labo#r is generally available thro#gh the Township -abo#r 9ffices% The

Township -abo#r 9ffice m#st be notified in the prescribed form where a private enterprise see7s

to employ more than fo#r wor7ers% The -abo#r 9ffice will then arrange interviews with a n#mber

of candidates who meet the employer8s criteria%

)alary levels in Myanmar are c#rrently among the lowest in Asia% )alaries of wor7ers employedby ,oreign Companies are fi4ed by m#t#al agreement between the employer and employee and

reflect the s7ill of the employee% )et o#t below is an indicative monthly salary range:

)o-ition Saary equi2aent to US8


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,resh niversity *rad#ate @ ! 10

)ecretary '"nglish spea7ing( 10 ! .00

=river 100 ! 10

Maid/Coo7/*ardener 0 ! 100

Acco#ntant 10 ! F00

Chief Acco#ntant F00 ! 00

"mployees of private enterprises are entitled to the following paid ann#al leave:

E days cas#al leave

.0 days medical leave

10 days earned leave and

F1 p#blic holidays%

,emale wor7ers are eligible for paid maternity leave in addition to the leave entitlements

o#tlined above%

The stip#lated wor7ing ho#rs in Myanmar are:

>or7 6lace 5o#rs per day/wee7

)hops$ offices$ trading centres service

enterprises$ entertainment ho#ses

;/;

,actories$ oil fields and mines ;/

ndergro#nd mines ;/0

6rivate enterprises employing more than five wor7ers are re#ired to contrib#te an amo#nt

e#al to . '#p to a ma4im#m contrib#tion cap( of the wages of their employees 'to be paid in


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the c#rrency in which the employees are paid( to ma7e provision for the social sec#rity of their

employees%

"IS)UTE RES&LUTI&N

Arbitration is the preferred and often re#ired method of disp#te resol#tion in Myanmar% Apartfrom foreign trade contracts$ there is no legal re#irement that a contract be governed by the

laws of the nion of Myanmar or that the parties s#bmit to the risdiction of the Co#rts of

Myanmar% As a matter of policy and practice$ however$ there can be no do#bt that the MIC 'as a

condition of iss#ing either the ,I- 6ermit or the CA 6ermit($ other *overnment approval

a#thorities and )tate!owned economic enterprises will:

'i( re#ire that the governing law of the contract be e4pressly stated to be that of the nion of

Myanmar

'ii( insist that any disp#te arising sho#ld be resolved by arbitration #nder the provisions of the

Myanmar Arbitration Act of 1D and

'iii( re#ire that Myanmar be the place of arbitration%

5owever$ large investments in one partic#lar ind#stry sector have been able to sec#re

arbitration in )ingapore #nder


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International Chamber of Commerce$ for e4ample( in the contract is perhaps the most practical

meas#re presently available to lessen those concerns%

The *overnment is aware of foreigner investors8 concerns regarding disp#te resol#tion and has

anno#nced that it is giving +serio#s consideration+ to permitting +international arbitration+% It is

e4pected that$ if allowed$ s#ch international arbitration will only be permitted if it is cond#cted byone/#nder the arbitration r#les of a few specialist international organisations% The following s#ch

organisations and arbitration r#les are c#rrently being +closely st#died+ by the *overnment:

The nited


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)a--ing &..

Apart from that given by stat#te$ there is no property in a name or mar7 as s#ch% 5owever$ the

general law provides that no trader has any right to represent his/her goods as the goods of

somebody else% An action based on this principle$ namely$ an action based on passing off$ lies

only where there is a tangible possibility of damages to some b#siness or trading activity% It isnot necessary to prove a fra#d#lent motive or representation and the plaintiff is entitled to

nominal damages if no act#al damage is proved%

The conse#ence of the application of the right to prevent passing off is that a trader who #ses

a name or mar7 or get!#p that has become distinctive of his/her goods can prevent others #sing

the same or a similar name or mar7 where that #se will deceive or is calc#lated to deceive a

s#bstantial n#mber of members of the trade or p#blic into thin7ing that the goods offered for

sale or s#pplied to them are his/hers%

The remedies which may be granted in actions for passing off are innctions$ award of

damages or an acco#nt of profits% In appropriate cases$ orders may be made for the delivery #pof infringing articles or labels or the eras#re of an offending mar7%

The e4tent of the #se which is necessary for the plaintiff to prove depends on the nat#re of the

mar7 or name and the other circ#mstances of the case b#t$ in general$ it is s#fficient to prove

#se within a limited area or even #se abroad$ provided that the area and #se are s#ch that

conf#sion is li7ely to arise between the plaintiffHs goods and those of the defendant%

It is not necessary for the plaintiff to show that conf#sion has act#ally occ#rred between the

goods of the plaintiff and defendant in order to obtain an innction$ if the co#rt is of the opinion

that there is a strong probability of conf#sion occ#rring in the normal co#rse of trade% 9f co#rse$the fact of s#ch conf#sion having act#ally occ#rred is strong evidence of the probability of its

rec#rrence in the f#t#re%

In considering whether there is any li7elihood of deception of the p#blic by a name or mar7

applied to goods$ the persons to be considered are ordinary sensible members of the p#blic$

e4cl#ding on the one side those who are partic#larly 7nowledgeable in the partic#lar trade and$

on the other hand$ those who are so ignorant that they o#ght not to be ta7en as representative%

&'NERS(I) &F AN" TITLE T& LAN" IN #$AN#AR

In Myanmar the ownership of and all registrable interests in land are recorded in a registermaintained at the -and Records =epartment of the district or administrative region in which the

land is sit#ate '+Register+(% The Register is$ in essence$ a register of entitlement of named

proprietors to the landholdings with which those proprietors are identified% The entitlement is

s#b&ect to s#ch mortgages and other b#rdens$ if any$ as are set o#t on the Register and to

overriding interests 's#ch as title gained by adverse possession$ rights of way$ easements and

leases of less than one year($


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which may s#bsist over the land tho#gh not mentioned in the Register and therefore

#ndisclosed by a search of the Register%

In Myanmar$ both freehold and leasehold title to land are recognised and all doc#ments which

create$ declare$ assign$ limit or e4ting#ish 'whether in the present or f#t#re( any right$ title$

interest in immoveable property m#st be registered in order to be effective and enforceable%,#rther$ the transfer of ownership in immoveable property and all leases of immoveable property

from year to year or for any term e4ceeding a year can only be effected by a registered

instr#ment% All registered transactions are noted #p in the Register%

The Register may be searched and s#ch search forms the fo#ndation of proving oneHs title

to/interest in the relevant land% 5owever$ a search of the Register does not relieve a p#rchaser

of land$ for e4ample$ from the d#ty to inspect the property or to ma7e appropriate en#iries as to

the e4istence of any overriding interests b#t$ s#b&ect to the provisions relating to fra#d and s#ch

overriding interests$ a p#rchaser ta7ing #nder a registered doc#ment for val#e witho#t notice of

other #nregistered registrable interests will obtain good title to the land$ free from s#ch interests%

+>itho#t notice+ re#ires that the p#rchaser$ to contin#e with the e4ample$ ma7es reasonableen#iries to ascertain that the transferor had the power to ma7e the transfer% As a general r#le$

the p#rchaser/lessee sho#ld 'i( search the Register 'ii( obtain and review the deed of title and

'iii( en#ire as to who is/was in act#al possession of the land within$ at least$ the 1F years 'the

time in which title #nder adverse possession may arise( prior to the p#rchase/lease of the land%

)#b&ect only to specific stat#tory restrictions$ immoveable property may be freely transferred

and leases over it may be freely granted% Two of the main stat#tory restrictions affecting the

transfer of and grant of leases over immoveable property are for 'i( agric#lt#ral land and 'ii(

transfers/leases to foreigners:

Agricutura an4:+Agric#lt#ral land+$ being land ordinarily #tilised for p#rposes of farming$ may

only be transferred or leased to other farmers or persons who intend to contin#e the farming

activities on the land% The Register will #s#ally mention if land is +agric#lt#ral land+%

Tran-.erea-e- to .oreigner-:The Transfer of Immoveable 6roperty 'Restrictions( -aw 1D;@

prohibits the transfer of or grant of a lease of more than one year over immoveable property to a

+foreigner+ or +company owned by a foreigner+%

-i7e most governments$ the Myanmar *overnment has the right to comp#lsorily ac#ire land

and interests in land #pon the payment of compensation to the land/interest holder%

Compensation paid by the *overnment is calc#lated in accordance with established regionalform#lae and has incl#ded money$ grants of land and ho#sing% -and so ac#ired by the

*overnment is d#ly noted #p in the Register

Investors interested in registering a company in Myanmar will first need to decide what

7ind of str#ct#re they want to set #p% Available options are a sole proprietorship$ a


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partnership$ a limited liability company '--C($ a registered branch of a foreign company$

or a &oint vent#re%

After deciding on the type of b#siness yo# want to set #p yo#Hll need to apply for a

permit to trade at the Company Registration 9ffice$ which is #nder the =irectorate of

Investment and Company Administration% The main CR9 office is in


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The above process is for a normal company #nder the Myanmar Companies Act%

Investors wishing to apply for a Myanmar Investment Commission 'MIC(6ermit will need

to s#bmit a detailed b#siness plan and financial model to the MIC$ as well as fill o#t

additional forms% If yo# want to apply for an MIC permit$ itHs a good idea to have a local

company help yo# with the process%

Myanmar Company Registration, Step-by-StepWritten byInteractive Myanmaron June 28, 2012. Posted inUncategorized

Regi-tering a co,+any in #yan,ar

A -te+9y-te+ gui4e .or -tarting a .oreigno5ne4 9u-ine-- in #yan,ar

Myanmar offers two options to foreign investors who want to register a b#siness entity in a nation

blessed with rich nat#ral reso#rces and famed for its ine4pensive s7illed labo#r% B#sinesses that

re#ire s#bstantial investment$ s#ch as man#fact#ring$ constr#ction$ mining$ hotels L resorts$

agric#lt#re and transportation$ need to be registered #nder the Myanmar ,oreign Investment -aw

'M,I-(% 5owever$ foreign trading companies and service providers can register #nder the Myanmar

Companies Act 'MCA(% "4isting laws restrict trading activities by foreign companies%

Regi-tration un4er t/e #yan,ar Foreign In2e-t,ent La5 #FIL;

9ne h#ndred percent foreign!owned companies and &oint vent#res with the Myanmar government

or Myanmar nationals can be registered #nder the M,I-% ,or &oint vent#res$ the minim#m

foreign sta7e is . percent of the companyHs share capital% =espite the minim#m specified capital

re#irement of )2 00$000$ in practice b#siness entities #s#ally invest between )2 1$000$000

to )2 F$000$000$ depending on the si3e and nat#re of the investment pro&ect% In the case of &oint

vent#res with the Myanmar government$ companies can opt for local company stat#s #nder the

)pecial Company Act '1D0(%

The main stages for registering a company #nder M,I- are:

Ste+1: A++ying .or #yan,ar In2e-t,ent Co,,i--ion


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"ssential doc#ments re#ired for this process are:

'A( 6roposal to the ,oreign Investment Commission in the prescribed form ,orm I

'B( =raft contract or contracts$ as the case may be 'eg% GN Agreement(

'C( =raft Memorand#m of Association and Articles of Association

'=( ,easibility )t#dy and 6rofitability 6ro&ection )tatement for the pro&ect period or first ten years$

incl#ding a OCash ,low )tatementP

'"( Ban7 reference regarding financial standing

',( -ease of -and or 6roperties with maps etc%

'*( ,or a company$ 'i( last two yearsH Ann#al Reports and 'ii( 6erformance g#arantee

Ste+=: A++ying .or >)er,it to Tra4eard Chief

angon is divided into districts$ and .. townships% "ach

township is then divided into a certain n#mber of wards$ which is

the smallest administrative #nit gro#ping several ho#seholds or

Qeach bloc7H% The Qward chiefH provides a letter confirming the

address of the new b#siness%

F days$sim#ltaneo#swith previo#sproced#re no charge

. &9tain cri,ina /i-tory .ro, t/e to5n-/i+ +oice -tation

Agency:Township police station

1 day no charge


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No@ )roce4ureTi,e toCo,+ete

A--ociate4Co-t-

After obtaining the reference letter from the ward$ the relevant

township police station signs a letter containing yo#r criminal

history%

Reque-t 9u-ine-- incor+oration certi.icate

Agency:=irectorate of Investment and Company Administration

'=ICA(

9nce the name chec7 is complete$ the following doc#ments are

a#tomatically generated by CR9 based on the information

provided on the application form 'to cond#ct name chec7( and are

chec7ed for acc#racy by the applicant:

o Application form 'company name$ list of directors with I=S and

addresses$ a#thori3ed capital$ initial paid #p capital$ address(

o Memorand#m and Articles of Association 'for local company$

only B#rmese version is re#ired$ tho#gh for "nglish there is also

a standardi3ed format available(

o -ist of proposed b#siness activities 'to be incl#ded in the

Memorand#m of Association(

o 6hotocopy of the national registration certificate for each

director 'incl#des dates of birth$ relationship$ occ#pation$ I=S$

ethnicity$ citi3enship$ religion(% This is a standard form which each

director already has in his/her possession%

o Copy of the township ho#sehold list 'each director to provide(o >ard reference letter 'each director to provide(

o Criminal history letter from the township police station 'each

director to provide(

The applicant chec7s the acc#racy of the generated doc#ments$

and goes bac7 to the directors/shareholders to obtain relevant

signat#res on the application form and memorand#m and articles

of association% 1 day

?yat $100'applicationfee(

&9tain -ignature o. t/e 4irector- 9e.ore a a5yer or certi.ie4

+u9ic accountant

Agency:-aw or Acco#nting firm

The memorand#m and articles of association are signed before a

lawyer or C6A% The cost of witnessing the signat#re of the

memorand#m and articles of association are abo#t 0$000 ?yat% 1 day

?yat 0$000

for witnessingthe signat#reof thememorand#mand articles ofassociation

E )ay,ent o. -ta,+ 4uty an4 regi-tration .ee- 1 day ?yat 1 million'registration


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A--ociate4Co-t-

Agency:=irectorate of Investment and Company Administration

'=ICA(

6ayment of stamp d#ty on the Articles of Association$ can be done

at the one!stop!service for company registration at =ICA%

fees( ?yatE0$000'stamp d#ty(

@

&+en Ban3 Account

Agency:Ban7

After paying registration fees$ =ICA( iss#es a letter to confirm that

the company has been registered% The applicant ta7es this letter

to a ban7 and opens an ban7 acco#nt in the company8s name% 1 day no charge

;

&9tain certi.icate o. incor+orationAgency:angon =irectorate of Investment and Company

Administration '=ICA(

After opening a ban7 acco#nt$ the applicant ret#rns to the CR9

'=ICA( to s#bmit evidence of ban7 acco#nt to =ICA and to obtain

the incorporation certificate% It needs to be reviewed and signed

by the Assistant =irector and the =ep#ty =irector of the CR9% The

applicant is informed by the =ICA when the definitive certificate is

ready to be pic7ed #p% The certificate is valid for years% . days

paid as partof companyincorporationfees

D

Su9,it certi.ication o. regi-tration 4ocu,ent- CR";

Agency:angon =irectorate of Investment and Company

Administration '=ICA(

"ntreprene#rs s#bmit ,orm E ')hareholder list( and ,orm FE

'=irector list( to =ICA% These forms contain information on whom

owns shares in the company$ the list of board of directors$ a

description of the roles$ and other pertinent information% 1 day no charge

10

&9tain a -ea or a ru99er -ta,+

Agency:)ealma7er

According to the law$ a company seal is re#ired for a newly

constit#ted firm to operate% 5owever$ in practice a r#bber stamp is

#sed and accepted% It can be prod#ced in shops in downtown

angon for a cost of F$000 7yat% 1 day ?yat F$000

11 Regi-ter .or co,,ercia ta


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A--ociate4Co-t-

Agency:Township Internal Reven#e =epartment 9ffice

Registration for commercial ta4 'similar to NAT(: companies areobliged to register with the ta4 a#thorities one month before the

start of their b#siness if the b#siness is e4pected to generate

t#rnover s#b&ect to commercial ta4 'a broad array of prod#cts fall

into this category$ incl#ding man#fact#red goods(% ,#rthermore$

within 10 days of starting a b#siness the ta4 a#thorities sho#ld

also be informed%

=ICA compiles a list of newly registered companies each month

and sends this information to the relevant townships where the

b#sinesses are located%

(o5 to regi-ter a co,+any in #yan,ar

BUSINESS &R!ANIATI&N

1@ Regi-tration o. 9u-ine-- &rganiation

9peration in Myanmar can be carried o#t thro#gh one of the following b#siness organi3ations:

! 6artnerships

! Companies limited by shares% i%e% &oint vent#re companies local companies foreign companies

! Branch or Representative offices of a foreign company

! Associations not for profit

=@ )artner-/i+-

A gro#p of individ#als may enter into partnerships in order to carry on a b#siness%

The partnershipHs rights and obligation are based on the agreements between the partners and the

6artnership Act of 1D.F% In accordance with the Act$ the n#mber of partners is limited to twenty% Apartnership firm may be registered$ b#t registration is not comp#lsory% All partnerships formed in Myanmar

are of #nlimited type% >hen no provision is made for the period of time$ the partnership will be dissolved

when all partners are willing to do so%

?@ Co,+anie- Li,ite4 9y S/are-

A company limited by shares is re#ired to register% ,or foreign enterprises$ the most normal method of
http://www.myanmar-business.org/2011/05/registering-business-in-myanmar.htmlhttp://www.myanmar-business.org/2011/05/registering-business-in-myanmar.html


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doing b#siness in Myanmar is thro#gh a limited company% )#ch a company co#ld be a foreign company

registered in Myanmar or by means of a branch office or representative office formed o#tside Myanmar% If

one share is owned by a foreign partner$ the company shall come #nder the definition of a foreign

company$ and shall apply and obtain a 6ermit before registration% There are two main types of company:

a private limited liability company and a p#blic limited liability company%

! In a private limited -iability company$ the transfer of shares is restricted$ the p#blic cannot be called

#pon to s#bscribe for shares$ and the n#mber of members is limited to fifty%

! In a p#blic limited liability company$ the n#mber of shareholders m#st be at least seven% The company$

after registration$ m#st apply for a Certificate of Commencement of B#siness to enable start the b#siness

operation%

! The governing law for the limited companies is the Myanmar Companies Act 1D1% A company with

share contrib#tion of the )tate shall be registered #nder the )pecial Company Act 1D0 and the Myanmar

Companies Act 1D1%

! There are generally no minim#m share capital re#irements% 5owever$ minim#m re#irements do e4ist

for ban7ing and ins#rance companies and foreign companies and branches of all b#siness%

,or foreign companies and branches$ the minim#m capital to be bro#ght in is as follows:

! Ind#strial company ! foreign c#rrency e#ivalent to ?% 1$000$000%

! )ervices company ! foreign c#rrency e#ivalent to ?% .00$000%

D@ "ocu,ent- require4 .or regi-tration

nder section F@A of the Myanmar Companies Act$ a foreign company$ whether a h#ndred percent

owned or a &oint!vent#re and a branch/representative office$ is re#ired to obtain a 6"RMIT before

registration% 5owever$ a &oint!vent#re with the )tate e#ity formed #nder )pecial Company Act 1D0 ise4empted from obtaining a 6"RMIT%

The application for 6"RMIT is to be accompanied by the following doc#ments:

'1( ,orm A of the Myanmar Companies Reg#lation 1D@

'F( =raft Memorand#m and Articles of Association

'.( =#ly completed #estionnaire form

'( Intended activities to be performed

'( "stimated e4pendit#res to be inc#rred in Myanmar for the first year operations

'E( ,inancial credibility of the company/individ#al

'@( Board of =irectorsH resol#tion$ if the s#bscriber is a company%

In the case of a foreign branch/representative office$ the following shall be f#rnished in addition to the

above mentioned doc#ments%

'1( Instead of the companies draft Memorand#m and Articles of Association$ a copy of the 5ead 9fficeHs

Memorand#m and Articles of Association or of the Charter$ )tat#te or other instr#ments constit#ting or

defining the constit#tion of the company$ d#ly notari3ed and cons#lari3ed by the Myanmar "mbassy

concerned in the co#ntry where the company is incorporated%


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'F( The Ann#al Report for the last two financial years '9R( if it is the copies of the 5ead 9ffice Balance

)heet and 6rofit and -oss acco#nts for the last two financial years$ it is to be notarised and cons#lari3ed

by the Myanmar "mbassy concerned in the co#ntry where the company is incorporated%

'.( >here the original Memorand#m and Articles of Association and other relevant doc#ments are not in"nglish lang#age$ a#thentication of the translation into "nglish%

The application for registration is to be accompanied by the following doc#ments%

'1( Two sets of Memorand#m and Articles of Association d#ly stamped and printed both in Myanmar and

"nglish

'F( =eclaration of registration

'.( =eclaration of legal and official version of the doc#ments

'( =eclaration of the sit#ation of registered office

'( Translation certificate by a competent translator

'E( -ist of =irectors

'@( -ist of person's( a#thori3ed to accept services of process and notice in Myanmar on behalf of the

company 'i%e% for a branch office of a foreign company%(

,or a 6#blic company$ the following additional doc#ments shall be s#bmitted before commencing the

b#siness

'1( -ist of person to act as directors

'F( -ist of person who have consented to act as director

'.( Agreement to ta7e #alification shares%

)o#rce: =irectorate of Investment and Company Administration '=ICA($ Minstry of


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foreigner is restricted% & public limited liability company is re/uired to have at least sevenshareholders%

Registration of companiesForeign investors may register their companies under the Myanmar .ompanies &ct (.&) or

in conjunction with the Union of Myanmar Foreign Investment Law (MFIL)% +hedifferences between companies registered under the .& and the MFIL are1" companies registered under the MFIL are eligible for ta' incentives (refer to section fordetails) whereas companies registered under the .& are not" both companies registered under .& and MFIL are allowed to underta2e manufacturingactivities and provide services, however the minimum foreign share capital re/uirementsaresignificantly different (as specified below)" minimum foreign share capital for companies registered under MFIL is U!30, formanufacturing and U!34, for service companies whereas for companies registeredunder .& it is only U!30, for manufacturing and U!30, for service companies%

Registration of foreign investment under the MFIL involves the following steps:" obtaining a permit from the Myanmar Investment .ommission (MI.)" applying for a permit to trade from the 5irectorate of Investment and .ompany

&dministration (5I.&)" applying for registration with the .ompanies 6egistration #ffice (.6#)%

& foreign company formed under the .& does not need to obtain an MI. permit, and is onlyre/uired to apply for a permit to trade and then register with the .6#%Corporate structure

&t least two shareholders and two directors are re/uired% +here is no re/uirement for theshareholders to be natural persons and there is no re/uirement for the directors to be

residents in Myanmar%

Minimum share capital requirements+he level of minimum share capital re/uirements imposed on the companies variesdepending on the types of activities that a company intends to underta2e, as detailed in thefollowing table1

2. Branch of a company incorporated outside Myanmar& foreign company can also set up its branch office in Myanmar% & foreign branch formedunder the .& does not need to obtain an MI. permit, and is only re/uired to apply for apermit to trade and then for registration% +he branch is allowed to be formed as a

manufacturing or a service company (for instance oil companies are set up mostly in theform of branches)% In contrast, a foreign branch formed under the MFIL is re/uired toobtain an MI. permit in addition to a permit to trade and a registration certificate%6egistration fees payable on the registration of a branch are U!3-,0%3. Representative office of a company incorporated outside MyanmarForeign companies with business relations or investment projects in Myanmar may apply toset up representative offices in Myanmar (this being a common practice for ban2s)% In


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contrast with a branch, a representative office of a company incorporated outside Myanmaris not allowed to perform direct commercial or revenue generating activities in Myanmar%7owever, it is permitted to liaise with its head office and collect data useful for the headoffice%

4. Joint ventureForeign investors can set up their business in the form of a joint venture, either aspartnerships or limited companies, with any Myanmar partner (an individual, a privatecompany, a cooperative society or a state owned enterprise)% In all joint ventures, theminimum shareholding of the foreign party is 40* of the total e/uity capital%

mm procedure for incorporating a company

Documents