The new Myanmar Investment Law 2016 (MIL) came into force on October 18, when it was signed by the President, having previously been approved by the Pyithu Hluttaw on September 28 and the Amyotha Hluttaw on October 5. The MIL was drafted by the Myanmar Investment Commission (MIC) in consultation with the International Finance Corporation (IFC) and combined local and foreign investment regulations, by replacing Foreign Investment Law of 2012 (FIL) and the Myanmar Citizens Investment Law of 2013.
It represents further liberalization of the Southeast Asian nation’s foreign investment laws to accommodate rapidly changing economic environment. While the exact regulatory contents of the new law have yet to be finalized, many of its key features have already come to the surface. The Investment Law combines the previous Myanmar Citizen’s Investment Law with the Foreign Investment Law – ending Myanmar’s status as the only ASEAN member with separate investment laws for citizens and foreigners. Changes to Myanmar’s previous investment regulations include a new approval process with the MIC, updates to the distribution and length of various tax incentives, and further easing of foreign access to land leases.
The followings represent salient features of the new law.
The first point of the policy highlights the will of the government to welcome responsible businesses which benefit both the investor and the country. Secondly, MIC and other related governmental organizations will simplify the investment process with faster rate and transparency.
Thirdly, the policy emphasizes the macroeconomic stability of the country, encouraging rule of law, reliable regulations for arbitration, trustworthy financial system to promote economic infrastructure. The fourth point highlights the government promises to take responsibility of improving investment environment, enhancing check and balance and transparency without discrimination between local and foreign enterprises.
Other promises are the assurance of protection of profits after taxation and transactions of businesses in accordance with the law.
The fifth point is notifying both local and foreign investors to follow the rules and regulations for taking responsibility concerning with environment and natural resources.
The sixth point prohibits foreign investors from operating in the areas concerning security, culture and society of the state. The government will announce the prohibited business areas soon.
The seventh point highlights the country’s promoted sectors for investments which cover improving the productivity for global value chain and value-added agricultural products production, the businesses which can be effective for local ones in bringing the technology, the businesses which enhance the small and medium enterprises, the businesses which accelerates the infrastructure development, the ones which create job opportunities and vocational training, the ones which invest in least developed regions, the ones which can operate in industrial towns and special businesses in cooperation. The last point is investments related with travel and tour sector.
Representatives of the Directorate of Investment and Company Administration (DICA) have informally indicated that a complete set of MIL implementing laws is expected to be issued by 1 April 2017.
