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DOING BUSINESS IN MYANMAR

Myanmar Legal Services Limited Room no. 117, Inya Lake Hotel 37, Kaba Aye Pagoda Road, Yankin Township Yangon, Myanmar T: 951662866; 951-662-857 Ext. 1117 http://www.myanmarlegalservices.com/

Attn: Daw Khin Cho Kyi <MyanmarLegal@mptmail.net.mm>

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Special Features of the Myanmar Legal System

Early British colonial laws in English language are still in force, unless specifically superseded. Most legislation is published in Myanmar and English languages. The language of the courts is Myanmar. At university, law is taught at the undergraduate level, in English language. Foreigners who invest in local companies or through nominees have no legal standing to enforce their rights. Foreigners may not purchase land or condominiums. No jury system. The pace of court proceedings is slow. Criminal cases are tried under the Code of Criminal Procedure [India Act V, 1898] and Civil Cases are tried under the Code of Civil Procedure [India Act V, 1908]. There are no international accounting firms in Myanmar. Accounts system is governed by Myanmar Accountancy Law. The legal profession is long established. Exchange of foreign currencies is allowed only through government banks, and recently licensed exchange centers. There are three main currencies: Kyat, Foreign Exchange Certificates (FEC), and US Dollars; and Euro, Singapore Dollars, and other currencies since US sanctions on US$ transactions. The laws and practices governing investing in Myanmar are undergoing rapid changes. The Myanmar Government is obtaining technical assistance and training in a number of key areas, including foreign exchange controls, finance and investment law reform and trade facilitation. A new Foreign Investment Law (2012) and the State Budget Law are expected to be passed by the Parliament in its session commencing in February 2012.

Myanmar Legal Services Limited Attn: Daw Khin Cho Kyi MyanmarLegal@mptmail.net.mm

Sources of Law
British colonial law, from India Burma Code (13 volumes, enacted 1841-1954) Various laws and regulations (as amended) Myanmar Companies Act (1914), Rules (1940) and Regulations (1957). Oil and gas laws. Oilfields Act (1918) supplemented by numerous laws and regulations, including The Oilfield Rules 1936; The Petroleum Act 1934, The Petroleum Rules, 1937, The Essential Supplies and Services Act 1947, The Oilfields (Labour and Welfare) Act 1951, The Petroleum Resources (Development Regulation) Act 1957, The Law Amending the Petroleum Resources (Development Regulation) Act 1969, and the Myanmar Petroleum Concession Rules 1962. Production sharing contracts are signed with Myanmar Oil and Gas Enterprise (MOGE). Special Companies Act (1950) (if joint venture with government enterprise). Foreign Investment Law (1988), administered by the Myanmar Investment Commission, and its Procedures: Draft new Foreign Investment Law. Notifications on 30 September 2011: foreign investors under FIL permitted to use land for 30 years, renewable twice 15-years each; and use of foreign currency with the approval of MIC. Notification no. 82/2011 issued 1 September 2011 prescribing powers, duties and composition of MIC. State-owned Economic Enterprises Law. Private Industrial Enterprise Law (1990). Income Tax Law Rules and Regulations (1974) (Flat rate 30% applicable to companies under FIL or MCA; otherwise 35% or graduated rates 35-50%). Notification No. 41/2011 introduced withholding of income tax on specified payments. Commercial Tax Law (1990) (a turnover tax levied on goods and services, rates vary). Double tax agreements: UK, Singapore, Malaysia, Vietnam, Indonesia, South Korea, and Thailand. (Thai DTA came into force on 1 January 2012). Various labour laws. (Trade Unions Act revoked, and superseded by Labour Union Law on 11 October 2011). Immigration law, governing visas for foreigners. (There is no work permit law in Myanmar.) Transfer of Immovable Property Restriction Law of 1987. Myanmar Mines Law of 1994, and Myanmar Mines Rules of 1996. MSEZL: Myanmar Special Economic Zone Law (January 2011). DSEZL: Dawei Special Economic Zone Law (January 2011). Second session of Parliament adopted 15 new laws/amendments during Sept-Nov 2011.
Myanmar Legal Services Limited Attn: Daw Khin Cho Kyi MyanmarLegal@mptmail.net.mm 2

Special Features of the Myanmar Legal System

(Contd)

2008 Constitution of Myanmar Announced on 29 May 2008 that Constitution of the Government of the Republic of the Union of Myanmar was ratified and promulgated by the National Referendum. The Constitution became effective on 31 January 2011 (first convening of the new Parliament). Arbitration: Myanmar Arbitration Act 1944 Party to Geneva Protocol on Arbitration Clauses of 1923 (not a party to NY Convention, ICSID Convention or other convention relating to arbitration). Member of ASEAN, with obligation to ratify Protocol on Dispute Settlement Mechanism.

Exchanging Rate Centers Opening of licensed exchange rate centers, October 2011. Steps towards reform of government exchange rate US$1 to approx. 6 kyats. Government approved/permitted exchange centers (banks) exchange rate US$1 to approx 800 kyats, subject to showing earnings of foreign currency.
Permits to Trade Permits to Trade, in practice, are no longer granted for foreign trading companies but has not been officially announced. IMF Technical Assistance Currently, the Government is taking steps in consultation with IMF on reforming the countrys dual exchange rate system. Several foreign governments are offering technical assistance re environmental and social safeguards, etc.

Myanmar Legal Services Limited Attn: Daw Khin Cho Kyi MyanmarLegal@mptmail.net.mm

Dawei Deepwater Seaport and Industrial Estate Development Project

General Overview
MOU signed between the Governments of Thailand and Myanmar to develop the Dawei Deep Seaport and Road Link to Bangkok on May 19th 2008 Framework Agreement signed between ITD and Myanmar Port Authority, Ministry of Transport on November 2nd 2010 for the development of the Dawei Deep Seaport, Industrial Estate, and Road and Rail Link to Thailand on a BOT basis.

Project established as a Special Economic Zone (SEZ). Concession Periods are for 60 years with the possibility of extension Land Lease Periods are for 75 years Right to import raw materials for processing and export without import duties and with corporate income tax exemption Production for domestic consumption is taxed at a normal rate Right to employ foreign management and skilled labor Allowance for financial transactions required for normal business operation Facilities to attain work permits, company and business registration, permits and licenses.
Myanmar Legal Services Limited Attn: Daw Khin Cho Kyi MyanmarLegal@mptmail.net.mm 4

Project Location

Myanmar Legal Services Limited Attn: Daw Khin Cho Kyi MyanmarLegal@mptmail.net.mm

Union of Myanmar Petroleum Blocks Map

(January 2012)

Myanmar Legal Services Limited Attn: Daw Khin Cho Kyi MyanmarLegal@mptmail.net.mm

Trans ASEAN Gas Pipeline Project (TAGP)

Current Roadmap of Thailand

Thai/Lao Friendship Bridges

Thai/Myanmar Friendship/Freedom Bridge

Chinas Asian Link Railway Project

Features
New Rail lines in Thailand, Laos and Myanmar, with plans to link existing train lines in Cambodia and Vietnam

Completion scheduled for 2015 of lines in Thailand and Cambodia

High speed passenger train routes to be built from Bangkok through Vientiane up to Mainland China

Other ASEAN Energy Networks

Map: from Regional Energy Policy and Planning in ASEAN for Sustainable Development (REPP-ASD) Montien Hotel, 10 11 October 2006 Bangkok, Thailand

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