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1. B. H. Loh Associates 5
Indonesia Myanmar
A Setting Up Company
1 What are the required document,
process, equity ration and
minimum registered capital
stipulated in the law for setting up
foreign enterprises?
Min registration capital of a subsidiary / factory is USD 220,000
which may be wholly held by foreign investment. Min 1
director, 1 commissioner and 2 shareholders should be
provided.
Min registered capital of a factory is USD 500,000 and for
service-oriented companies USD 30,000, which may be
100% held by foreign investors. At least 2 directors and 2
shareholders needed.
2 How to set up a offshore company? (1) Business certificate, articles of association (authenticated by
the Indonesia embassy)
(1) Business certificate, articles of association (1 original
copy authenticated by the Burmese embassy)
(2) Appointment letter of legal representative (2) 1 photocopy of director's passport
(3) 1 copy of passport and ID of director and shareholder
(3) 1 copy of credit certification in English (at least USD
30,000 in bank account)
3 How to set up local company? (1) 3 copies of passport and ID of director and commissioner of
the Indonesia company
(1) 2 photocopy passports of director of the Burmese
company
(2) 2 original copies of lease contract (2) English address of office in Myanmar
(3) 1 copy of business plan (3) 1 copy of business plan
(4) Total investment amount in Indonesia, registered capital,
business scope, the company name, operational years.
(4) 1 copy of credit certificate (In english) of personal
account of one of the directors (deposit amount of USD
1,000 - 2,000)
(5) Compliance statements of director of Indonesia company.
(5) 1 copy of lease contract (for factory application)
(6) 4 passport-size colour photos of each director of the
Indonesia company
4 How to set up process? (1) Prepare and send the application with required
documentation, compiled according to the investment plan. Set
up a joint venture agreement if you are making the investment
with Indonesian partners.
(1) About 1-2 weeks for the approval of Myanmar
Investment Commission (MIC)
(2) Apply for the in-principle business license from BKPM (2) About 1 week for the approval of The Directorate of
Investment and Company Administration (DICA)
(3) Establish Article of Association with a Public Notary detailing
proof of capital investment, and the Ministry of Justice for
approval and issuance of State Gazette.
(3) About 1 month (for company) or 2 - 3 months (for
factory) for the approval of Companies Registration Office
(CRO)
(4) Register with Inland Revenue Department (IRD) for taxpayer
identification number (NPwP) as taxable companies /
entrepreneur.
(5) Registration with the Department of Industry and Trade
(TDP)
(6) Obtain a letter of Domicile from the landlord of the office
premises and the regional government office, which states the
address of the company.
Investment in Indonesia vs Myanmar
Temporary license will be issued during the submission of
application to the DICA. After obtaining the temporary
license, the company should remit 50% of the registered
capital and factory should remit 505 of liquidity before
obtaining the formal license. The application will be
submitted to the CRO for final registration.

2. B. H. Loh Associates 5
Indonesia Myanmar
A Setting Up Company (Con't)
(7) Register for Environmental Impact Assessment Analysis
(AMDAL)
(8) Prepare operational or production planning - production
processes and their descriptions
(9) Submit documents in step 2- 8 to BKPM
(10) Obtain a Permanent Business License (IUT) from BKPM
B Income Tax Law
1 What is the fiscal year and filing
period?
The fiscal year start from 1/1 - 31/12, The companies can
choose to set custom customise its own fiscal years and to pay
tax on a monthly basis. Enterprise Income Tax can be paid by
themselves or through a tax consulting firm.
The fiscal year start from 1/4 - 31/3 of the next year and the
income tax shall be declared to the Office of Internal
Revenue from April - June. The corporation may pay in
advance on monthly / quarterly basis based on the no. of
invoices.
2 What are the tax rate of enterprise
and individual?
a Subsidiary / Factory 25% 25%
b Branch N/A 35%
c Resident
5 - 30% (The foreigner living 183 days deemed as resident) 1 - 30% (The foreigner living 183 days deemed as resident)
d Non-resident 20% 35%
3 What are the preference policies
for foreign investment?
N/A
Exemption of enterprise income tax for 5 years and the
reinvestment within 1 year after the expiration of 5 years.
N/A Commercial tax (at the rate of 5 %) for product exporting
may be reduced.
N/A 50% (Max) of the enterprise income tax on the profit from
product exporting may be exempted.
C Capital Injection
1 When will the registered capital be
remitted? When is the deadline?
According to Company Law UU No. 40/2007, at least 25% of
the investment plan is required to be paid up within a month.
Min investment plan is USD 880,000, thus mim paid up capital
is USD 220,000.
The temporary license of the company is valid for 6 months.
However, 50% of the registered capital should be remitted
within 6 months. If the capital is not remitted before the
deadline, the temporary license hel by the company will be
cancelled wthout refund; documents should be sent again if
the company still wants to continue the operation.
Investment in Indonesia vs Myanmar

3. B. H. Loh Associates 5
Indonesia Myanmar
C Capital Injection (Con't)
2 What is the min register capital of
foreign investment?
a Representative (USD) Not required 1,500,000 (Foreign Bank)
b Branch (USD) N/A 50,000
c Subsidiary (USD) 220,000 300,000
d Factory (USD) 220,000 500,000
D Lease Of The Land and Utilisation
1 How long is the period of land lease
(Special Economic Zone)? N/A
Company may lease a land in the zone for 30 years;
extension can be applied based on company scale. Lease
period can be up to 75 years.
2 How long is the period of land
lease?
According to the New Investment Law, a foreign investor can
acquire a leasehold title to land for 25 years, which may be
extended for 20 years and then be renewed again for 25 years,
total up to 70 years.
Lease contract signed by a foreign enterprise without the
permission of Myanmar Investment Commission (MIC) is 1
year. According to the Foreign investment Law in 2013, if
company with the permission may sign a lease contract of
50 years and the period may be extended twice (10 years
each time). The lease period is 70 years max.
3 Can the land be purchased with
foreign capital?
Foreigners and foreign companies are not permitted to own
property, however foreign investors can use the land with
restriction
According to the Transfer of Immovable Property Restriction
Law in 1987, foreigner may only lease land instead of
owning land. Most of the land in Myanmar is state-owned.
Although a small number of citizens are provided with
perpetuity (Freehold), transaction of land is limited among
the Burmese.
4 Right to use the land? And buiding?
Right to use (Hak Pakai) valid for 25 years. It can be extended
for 20 years, renewed for 25 years, up to a total of 70 years.
Land for Industrial use may only be located in the industrial
zone; location for office building is not limited.
Right to Build (Hak Guna) valid for 30 years. It can be extended
for 20 years, renewed for 30 years, up to a total of 80 years.
Both the seller and buyer of local land and factories should
pay tax to the government
Right to Cultivate (Hak Guna Usaha) valid for 35 years. It can be
extended for 25 years, renewed for 35 years, up to a total of 95
years.
Buyer - 10% and seller 35% - 37% (Including transaction tax
(30%) and stamp tax (5% - 7%) based on regions).
Investment in Indonesia vs Myanmar

4. B. H. Loh Associates 5
Indonesia Myanmar
D Lease Of The Land and Utilisation (Con't)
5 What is the lease price of office
and factory?
a Office (USD) 28 33
b Residential (USD) 18 17
c Factory (USD) 7 10
E Industrial Zones & Economic Zones
1
How many existing industrial zones
and special economic zones?
a Completed industrial zones 16 19
b Industrial Zones under planning 6 7
c Special economic zones 3 3
2 Where is the Special Economic
Zones? Riau Island, Batam Thilawa,
Bintan Island Dawei,
Karimun Island Kyuakphyu,
3 Where is the major ports? Jakarta Port Kyaukphyu Port, Mawlamyine Port
Tanjung Priok Port Yangon Port, Dawei Port, Kawthaung Port
Belawan Port Sittwe Port, Pathien Port
Surabaya Port Thandwe Port, Myeik Port
4 What are the investment incentives
in special economic zone?
(1) New foreign investors are entitled to 2 years exemption
from import duties on materials to be used in manufacturing
and simplified procedure for land acquisition in economic
zones.
(1) 1st - 5th year : exemption of enterprise income tax,
6th - 10th years : 50% exemption of tax from export income
(2) Corporate tax at 25% and 30% taxable income reduction of
the realized investment spread in 6 years (5% per annum)
11th - 15th year : if the profit from export is used for
reinvestment, the gain from investment may be exempted
from 50% of the income tax
(3) Accelerated depreciation and amortization (2) Tariff for machinery and vehicle import in the first 5
years may be exempted and 50% of the tariff may be
exempted in the second 5 years.
(4) A 10% withholding tax on dividends (20% in non-economic
zones)
(3) Tariff for importing raw material, equipment and
machinery for the export=oriented product processing area
may be exempted.
(5) Loss compensation for the period of 5 to 10 years. The
above tax concessions are issued by the Minister Of Finance
with annual assessment.
(4) The foreign capital invested in the guaranteed area is not
affected by the change in political situation of Myanmar
Investment in Indonesia vs Myanmar

5. B. H. Loh Associates 5
Indonesia Myanmar
F Staff cost and regulation
1 What is the minimun wage
a Admin (USD) 260 120
b Worker (USD) 210 70
2 What is the social insurance rate The companies with more than 10 employees are required to
provide social insurance for their employees. Insurance
coverage includes disease, maternty, death and occupational
injuries. Employer 3.7% and employee 2%.
The corporation with over 5 employees should purchase
social insurance for the staff, the insurance shall cover
disease, maternity, death and occupational injury. Employer
2.5% and employee 1.5%.
3 How much recruitment of
employment of local labour?
a First 2 years N/A Burmese labour - min 25% of total staffs
b 3rd year on N/A Burmese labour - min 50% of total staffs
c 5th year on N/A Burmese labour - min 75% of total staffs
G Miscellanous
1 Where should foreign investors
open up bank account when
establishing company?
Maybank, CIMB Niaga, RHB Due to the limitation of foreign exchange control in
Myanmar, investment holding company should set up
account in Taiwan First Bank or Singapore UOB / OCBC / DBS
bank for capital remittance.2 Area (10,000 km2) 192 68
3 Population (10 thousand) 25,000 5,900
4 GDP (Billion USD) 8,600 590
5 GDP - per capital 3,440 1,000
6 Min wage USD 210 70
7 Inflation 6.23% 6.30%
8 Goods And Services Tax 10% - 35% N/A
Investment in Indonesia vs Myanmar