Myanmar Company IncorporationWhat you need to knowPresented by Andrew TanDirector, Consult-Myanmar Co Ltd
In the previous videoThe key legal framework in Myanmar• State Owned Economic Enterprises Law (Reserved Sector)• Restricte...
Key Legal FrameworkState OwnedEconomicEnterprises Law(SOEEL)12 reservedindustries thatonly SOEEL canexploitRestrictedIndus...
What is the objective of the FIL?As a foreign investor we want to invest responsiblyWe want to invest in areas that are pr...
Objective of FILeconomic developmentjob creationexport promotionimport substitutiondevelopment of high tech manufacturingr...
Myanmar people want to catch upYears of sanction have the left the Myanmar people isolated and stagnantGovt realizes that ...
• One Stop Shop• Review investment proposal• Issue MIC Permit• Extend benefits should investorsinvest in remote region• Pu...
3 Key Benefits of FILMay 2013 www.consult-myanmar.com1. Tax Exemption & Reliefs2. Right to use Land3. Guarantees3 Pillars ...
Tax Exemption or ReliefIncome tax exemption for 5 yearsExemption from income tax if profit isput into reserve fund and re-...
Right to use landInvestor allow to lease land for up to 50 years MIC mayextend the period by 2 consecutive 10-year periodI...
GuaranteesThe Myanmar Government guarantees that a business formed under thepermit shall not be nationalized within the te...
3 GeneralclassificationsIndustrialManufacturingServicesConsultingDesignTrading*Import/exportNote: *Trading is reserved for...
Comparison TableWith FIL w/o FILLegislation Foreign Investment Law +Myanmar Companies ActOnly Myanmar CompaniesActSector R...
• There are 24 slides in thispresentation• The YouTube video URL is in thedescription box below• Or you can search in YouT...
• is a 100% foreign-owned company that is incorporated in Myanmar.Myanmar Registration No: FC 25/2013-2014.• member of Uni...
Myanmar Company Incorporation - What you should know http://consult-myanmar.com
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Myanmar Company Incorporation - What you should know http://consult-myanmar.com

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This video outlines the business opportunities for foreign investors in the Reserved Sector and the Restricted Industry. Discuss about the size of investment required to be successful in the reserved sector and the restricted industry. Examples given include those in Oil & Gas, Telecommunication, Mobile, Supermarket, Cigarette, Retail, Real Estate, Consumer Food, Franchise,etc. Explained the State Owned Economic Enterprises Law, the Foreign Investment Law and the Myanmar Companies Act.

This video comes with Closed Caption support i.e. you can turned on the subtitle (caption) in Youtube and have Youtube translate it into German, French, Italian, Spanish or any language that Google Translate supports.

To download the MP4 video and PDF transcript of this video go to our webpage at http://consult-myanmar.com/?p=2054

To see the 2nd video entitled "Myanmar Company Incorporation - What you need to know" join our Linkedin Group at http://www.linkedin.com/groups/ConsultMyanmar-5035150? The Youtube link is posted in the discussion forum.

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To contact us send an email to investopp1 (at) consult-myanmar (dot) com

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  • Hello this is Andrew here. I am the Director at Consult-Myanmar Company Limited.This is the 2nd video in a 2 part series on investing in Myanmar. Today we are going to talk about “Myanmar Company Incorporation – What you need to know”
  • In the previous video we discussed about the key legal framework in Myanmar and the industry or sector opportunities that are revealed by the new legal framework. This new framework gives foreigner investors the opportunity to hold controlling interest in their investment in Myanmar via 100% ownership or via a joint-venture. If you have not watch the previous video – please go to Part 1 video now as the investment strategy you adopt will decide on the type of investment vehicle you use. The company incorporation is that vehicle that you decide to use once you have decided on your investment strategy.
  • Let’s start with Part 2 video: Myanmar Company Incorporation – what you should know as an investor.
  • In this video we will focus on:The Foreign Investment LawMyanmar Companies Act
  • As a foreign investor it is important that you understand the objectives of the Foreign Investment Law – as we want to invest responsibly, by focusing our investment into areas that are profitable for us and at the same time is beneficial to the Myanmar people. The foreign investment law outlines what are the long term objectives that the Myanmar people want to achieve in order to take the country forward both economically and intellectually.
  • One of the key objective of the Foreign Investment Law is that of economic development of key industries that the Myanmar government considers to be crucial. Especially important are those sectors that create employment, export promotion and import substitution.
  • Myanmar people want to catch up with its neighbours like Thailand, Malaysia and Singapore. They do not want to be left behind in terms of economic development. The Myanmar people realize that years of sanctions have left the country both isolated and stagnant. The government realizes that in many sectors of the economy Myanmar people do not have the technology, management knowhow or capital necessary to fully exploit those segment or industry and to bring it to an international level quickly. Example would be operating deep sea oil and gas exploration platform or running a 4th Generation mobile network. That is where the Myanmar government feels that foreign capital, technology or management knowhow will do the most good. The Myanmar government is keen to develop the remote region of its country – for example if you can invest in a factory that will create employment in the remote and poor region of the country – the MIC can even look at extending the Exemptions and Reliefs that you received for a longer period.
  • The Foreign Investment Law provides the legal framework for foreign investors to invest in Myanmar. In it the roles and responsibilities of the Myanmar Investment Commission or MIC is defined.The MIC acts like a one stop shop. It is vested with the power to review all investment proposals that foreign investors submit. The MIC will co-ordinate with all government ministries to ensure that all investment proposals are treated in an expeditious manner.The MIC can approve the investor’s proposal and issue MIC Permit. It can also extend the benefits if the investor invest in remote region thereby creating employment and the MIC can also impose punitive measures if investors do not abide by the terms of the investment agreement.
  • Let’s go through the 3 key benefits that foreign investors will enjoy when they invest under the FIL scheme. I call these 3 benefits the 3 pillars to fruitful investment in Myanmar.
  • The first pillar and one of the most important that foreign investors enjoy under the FIL scheme is tax exemption or relief. For capital intensive &/or export-oriented industry – this first pillar is extremely attractive as it reduces the manufacturer’s tax liability significantly.As the investor get income tax exemption for 5 year, exemption from income tax for profit reinvested into the business, accelerated depreciation on capital equipment, 50% relief on export income, exemption from custom duty for import of capital equipment, exemption from duty for import of raw material.For foreign investors that invest in remote region and create employment there - investors can request for extension of the benefits beyond its stipulated period from the MIC.
  • The 2nd pillar is the Right to use Land. Under the 1987 Restriction Act – Foreigners are not allowed to buy or own land in Myanmar.However for foreign investors that are in export-oriented manufacturing under the FIL scheme they can easily lease industrial land from the government for up 50 years ; and if need be they can apply for 2 10-year extension on the lease.Foreign investor can also lease land from private land owner with the approval of the government. This is important for example if you are investing in say building 10 supermarkets in Myanmar over the next 3 years and you need land of at least 5,000 sqft for each site in order to run a successful supermarket and your Myanmar JV partner already own prime land in key cities in Myanmar that can be use for that purpose. The local partner can lease the JV company the prime land as their contribution to the joint-venture. If you are willing to invest in remote region and create employment there – the MIC is willing to look at extending your lease to a longer period.
  • The 3rd and final pillar is the Guarantees that the government gives to foreign investors under the FIL scheme.The government guarantees that your company will not be nationalized during the term of the FIL agreement. They will not suddenly terminate your company’s permit to trade unless you are breaking the law or violating the terms of the investment agreement. On expiry of the term of the contract, you are able to remit your profit out of the country after paying necessary taxes and liabilities.
  • There are currently 3 business classifications used by the Myanmar Companies Act: They are Industrial – which is for business involves in manufacturing;Service – for business such as consulting, design & advertising &Trading - which is import and export business. Take note that trading is reserved only for Myanmar citizen only. Foreigners cannot be involved in trading. Remember that one of the purpose of the FIL is to develop industries that Myanmar people do not have the technology, management knowhow or capital to develop. As trading is a low-tech business this is an area that foreign investors cannot participate in in Myanmar.
  • This table here shows a quick summary of the difference in the benefits that a foreign investor enjoy when they invest under the FIL scheme and when they invest without FIL scheme.As you can see for capital intensive industry that qualifies to invest under the FIL scheme – the benefits are substantial.
  • My last slide.I would like to let you know that Consult-Myanmar Company Limited is a 100% foreign owned company that is incorporated in Myanmar. We are a member of the Union of Myanmar Federation of Chamber of Commerce and Industry.If you have any questions about the market opportunities that I have just covered in my presentation – please do send me an email. Or you can visit our website.Before we part, I would like to wish you a fruitful and profitable investment experience in Myanmar.Good Bye.
  • Myanmar Company Incorporation - What you should know http://consult-myanmar.com

    1. 1. Myanmar Company IncorporationWhat you need to knowPresented by Andrew TanDirector, Consult-Myanmar Co Ltd
    2. 2. In the previous videoThe key legal framework in Myanmar• State Owned Economic Enterprises Law (Reserved Sector)• Restricted IndustryOpportunities created by the legal framework• Market weaknesses or gaps identified by the govt• Foreign investors can own 100% of a Myanmarincorporated company or• up to 80% of a JV subject to certain conditionsMay 2013 www.consult-myanmar.com 2
    3. 3. • This YouTube video is entitled“Myanmar Company Incorporation– What you need to know”• The YouTube video URL is in thedescription box below• Or you can search in YouTube for“Myanmar Company Incorporation– What you should know”This is Part 2of MyanmarInvestmentSerieswww.consult-myanmar.comMay 2013 3
    4. 4. Key Legal FrameworkState OwnedEconomicEnterprises Law(SOEEL)12 reservedindustries thatonly SOEEL canexploitRestrictedIndustry *ProhibitedMust JV with localMust seekpermission fromrelevant ministryMust meet certainother conditionsForeignInvestment Law(FIL)Administered byMyanmarInvestmentCommission( MIC)MyanmarCompanies Act(MCA)Issue of Permitto Trade andCompanyRegistration*Not a legislationCovered in previous videowww.consult-myanmar.comMay 2013 4
    5. 5. What is the objective of the FIL?As a foreign investor we want to invest responsiblyWe want to invest in areas that are profitable for us andat the same time beneficial to the people of MyanmarFIL outlines the long term objectives that the Myanmar people want toachieve both economically and intellectuallyMay 2013 www.consult-myanmar.com 5
    6. 6. Objective of FILeconomic developmentjob creationexport promotionimport substitutiondevelopment of high tech manufacturingregional developmentexploration and extraction of newenergydevelopment of modern industryprotection and conservation ofenvironmentwww.consult-myanmar.comMay 2013 6
    7. 7. Myanmar people want to catch upYears of sanction have the left the Myanmar people isolated and stagnantGovt realizes that Myanmar people do not have the technology, managementknowhow and capital to exploit many of the opportunitiesForeign investors can play a positive role by investing in those segmentswhereby Myanmar people are weak inInvestors that invest in remote and poor region and create jobs there – canget extended Exemptions and Reliefs from the govtMay 2013 www.consult-myanmar.com 7
    8. 8. • One Stop Shop• Review investment proposal• Issue MIC Permit• Extend benefits should investorsinvest in remote region• Punish if investors are breakingthe terms of the investmentagreementThe MyanmarInvestmentCommission isformed underthe FILwww.consult-myanmar.comMay 2013 8
    9. 9. 3 Key Benefits of FILMay 2013 www.consult-myanmar.com1. Tax Exemption & Reliefs2. Right to use Land3. Guarantees3 Pillars to Fruitful Investment9
    10. 10. Tax Exemption or ReliefIncome tax exemption for 5 yearsExemption from income tax if profit isput into reserve fund and re-investedin the business within 1 yearAccelerated depreciation formachinery, equipment, building andother assets.Relief of 50% on profit from exportedgoods manufactured by the companyCarry forward loss for up to 3consecutive yearsExemption from custom duty formachinery, equipment, spare parts andmaterials used in the construction of thebusinessExemption from custom duty on rawmaterials imported for production forthe first 3-year after the completion ofthe construction of business.Exemption or relief from commercial taxon goods produced for exportwww.consult-myanmar.comMay 2013 10
    11. 11. Right to use landInvestor allow to lease land for up to 50 years MIC mayextend the period by 2 consecutive 10-year periodInvestor can leased land from citizen subject to approvalfrom the governmentMIC may stipulate longer period of lease whereinvestment is in remote region of the countrywww.consult-myanmar.comMay 2013 11
    12. 12. GuaranteesThe Myanmar Government guarantees that a business formed under thepermit shall not be nationalized within the term of the contract or theextended term if such term is extended.The Myanmar Government guarantees not to suspend any investmentbusiness carried out under the permit of the Commission before theexpiry of the permitted term without any sufficient cause.On the expiry of the term of the contract, the Myanmar Governmentguarantees the invest or invested in foreign capital to disburse his rightsin the category of foreign currency in which such investment was madewww.consult-myanmar.comMay 2013 12
    13. 13. 3 GeneralclassificationsIndustrialManufacturingServicesConsultingDesignTrading*Import/exportNote: *Trading is reserved for Myanmar nationals. Foreigners are notpermitted to conduct trading business.www.consult-myanmar.comMay 2013 13
    14. 14. Comparison TableWith FIL w/o FILLegislation Foreign Investment Law +Myanmar Companies ActOnly Myanmar CompaniesActSector Reserved Sector, RestrictedIndustry, Manufacturing,ServicesService company, Branch &Rep OfficeLease 50 + 10 + 10 yrs 1 yrImport Licence Yes NoTax Incentive Yes NoGuarantee Yes NoMinimum Capital Industrial – US$500kServices – US$300kIndustrial – US$150kServices – US$ 50kBranch – US$50kwww.consult-myanmar.comMay 2013 14
    15. 15. • There are 24 slides in thispresentation• The YouTube video URL is in thedescription box below• Or you can search in YouTube for“Myanmar CompanyIncorporation – What you shouldknow”Go toYouTube tosee rest ofpresentationMay 2013 www.consult-myanmar.com 15
    16. 16. • is a 100% foreign-owned company that is incorporated in Myanmar.Myanmar Registration No: FC 25/2013-2014.• member of Union of Myanmar Federation of Chambers of Commerceand Industry (UMFCCI)• for more information please contact us at investopp@consult-myanmar.com• or visit our website at http://consult-myanmar.com• our address is at 47 Kaingdan St, 1st Floor, Lanmadaw Township,Yangon. Tel: +95-1-122-1268; Tel: +95-9-42000-1988• subscribe to our newsletter• wishing a you fruitful and profitable investment experience inMyanmarConsult-Myanmar Company Limitedwww.consult-myanmar.comMay 2013 16

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