The Foreign Investment Law (FIL) was enacted on 2nd November 2012 to promote foreign investment in Myanmar. The FIL imposes no foreign ownership limit on investment/economic activities, subject to some limits under regulations issued under the FIL. Section 56 of the FIL empowers the Ministry of National Planning and Economic Development (MNPED) and the Myanmar Investment Commission (MIC) to issue regulations to implement the provisions of the FIL. The MIC Notification No. 1/2013 categorizes investment activities into 3 lists. The MNPED Notification No. 11/2013 sets out detailed requirements and procedures for applications for MIC Permits and approvals, etc.

1. LAWPLUS
INVESTMENT IN MYANMAR
UNDER THE FOREIGN INVESTMENT LAW 2012
AND COMPANY REGISTRATION
UNDER THE MYANMAR COMPANIES ACT 1914
Presented by
KOWIT SOMWAIYA
MANAGING PARTNER
TO
THE FEDERATION OF THAI INDUSTRIES
3rd
MARCH 2014
QUEEN SIRIKIT NATIONAL CONVENTION CENTER

2. LAWPLUS 2
Presentation Topics
1. Overview of FIL
2. Investment Activities under FIL
3. Capital Requirements for MIC Permit
4. Major Incentives
5. Protection Measures
6. Application for MIC Permit
7. Company Registration Procedures
8. Application for Company Registration
9. DICA Permit Procedures
10. Application for DICA Permit (Permit to Trade)

3. LAWPLUS 3
Overview of FIL
• The Foreign Investment Law (FIL) was enacted on 2nd
November 2012 to
promote foreign investment in Myanmar.
• The FIL imposes no foreign ownership limit on investment/economic activities,
subject to some limits under regulations issued under the FIL.
• Section 56 of the FIL empowers the Ministry of National Planning and
Economic Development (MNPED) and the Myanmar Investment Commission
(MIC) to issue regulations to implement the provisions of the FIL.
• The MIC Notification No. 1/2013 categorizes investment activities into 3 lists.
• The MNPED Notification No. 11/2013 sets out detailed requirements and
procedures for applications for MIC Permits and approvals, etc.

4. LAWPLUS 4
Investment Activities under MIC Notification No. 1/2013
• List 1: Activities Prohibited to Foreigners:
 21 activities.
 Eligible to Myanmar citizens only.
• List 2: Activities Permitted to Foreign-Myanmar JVCs Only:
 42 restricted activities.
 Eligible to foreigner-Myanmar JVCs only.
• List 3: Activities Permitted to Foreigners
 115 activities subject to conditions imposed by 13 ministries.
 27 activities subject to other conditions.
 32 activities subject to an environmental impact assessment (EIA).

5. LAWPLUS 5
Capital Requirements for MIC Permit
• Minimum capital: Case-by-case basis to be determined by the MIC.
• Foreign ownership limits:
(1) 80% of the total capital for the permitted activities under List 2.
(2) No limit for the permitted activities under List 3, except for limits for some
activities, e.g.
- 25% for basic timber conversion
- 49% for high technology project requiring large investment
- 70% for manufacturing and marketing of chemical products.
• Capital can be paid in cash or in kind (machinery, intellectual property,
technical know-how, etc).

6. LAWPLUS 6
Major Incentives 1
• Exemption of corporate income tax for 5 consecutive years and for
profit reinvested in Myanmar within 1 year.
• Acceleration of depreciation of assets.
• Reduction up to 50% of income tax on profit from exports.
• Deduction of R&D expenditure from taxable income.

7. LAWPLUS 7
Major Incentives 2
• Set-off of losses carried forward up to 2 consecutive years after the
end of the tax exemption or tax reduction period.
• Exemption or reduction of customs duties and other taxes on
imported machinery and equipment.
• Exemption or reduction of customs duties and other taxes on
imported raw materials for the first 3 years.
• Foreign employees pay tax at the same rates as Myanmar
nationals.

8. LAWPLUS 8
Major Incentives 3
• Land lease up to 50 years plus 2 renewals of 10 years each.
• Land lease for a term longer than 50 years in less developed
regions is possible upon MIC approval.
• Can sub-lease or mortgage the leased land and buildings upon MIC
approval.
• Can export or sell products of the MIC approved project in
Myanmar.

9. LAWPLUS 9
Protection Measures
• No nationalization during the term of the MIC Permit.
• No termination of the MIC Permit without sufficient cause.
• Repatriation of the foreign capital upon expiration of the MIC
Permit or dissolution of the company, subject to MIC approval.

10. LAWPLUS 10
Application for MIC Permit
• Major Requirements
 Application Form 1
 Draft of AOA of the applicant
 Draft of MOA of the applicant
 Draft of JVA (if the applicant is a JVC)
 Financial documents of the applicant
 Bank confirmation letter on financial creditability of the applicant
 Detailed calculation of benefits to be generated by the project for the economy
• Timeframe
 4-5 months

11. LAWPLUS 11
MIC Permit

12. LAWPLUS 12
Company Registration Procedures
Filing Application for
Company Registration
with CRO
under DICA
Temporary Certificate
of Incorporation
Payment of 50% of
Registered Capital
Certificate of
Incorporation

13. LAWPLUS 13
Application for Company Registration
• Major Requirements
 Company Registration Form
 AOA
 MOA
 Declaration of Registration
 Declaration of Registered Office
 List of Directors (at least 2 directors)
 List of Shareholders (at least 2 shareholders)
 Copies of passports of shareholders (if individuals) and directors
 Copies of company registration documents of corporate shareholders (legalized)
 Copy of temporary DICA Permit
• Timeframe
 4-5 months

14. LAWPLUS 14
Temporary Certificate of Incorporation

15. LAWPLUS 15
Certificate of Incorporation

16. LAWPLUS 16
DICA Permit Procedures
Filing Application for
DICA Permit
with DICA
under MNPED
Temporary
DICA Permit
(Valid for 6 Months)
DICA Permit
(Valid for 5 Years,
Renewable)

17. LAWPLUS 17
Application for DICA Permit (Permit to Trade)
• Major Requirements
 Application Form A
 AOA of the applicant
 MOA of the applicant
 BOD Resolution of the applicant
 Bank confirmation letter on financial creditability of the applicant (legalized)
 Proposed business activities of the company
 Estimate of first-year expenses of the company
• Timeframe
 4-5 months

18. LAWPLUS 18
Temporary DICA Permit

19. LAWPLUS 19
DICA Permit

20. LAWPLUS 20
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21. LAWPLUS
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