Management, Innovation and Technology Applications ®

DR. MADHAB PAUL

Managing Director

MiTA SERVICES PTE LTD

S

H

W

E

M-9

AREA 678,500 SQKM

Population 59 million

DOING BUSINESS IN MYANMAR:

What you need to know to operate in Myanmar?

INTRODUCTION

MiTA @ Singapore, MYANMAR, Thailand, India, …expanding.

MiTA is Investment Advisory, Management Consulting and

Engineering Services company.

MiTA Myanmar is providing ONE-STOP Services, including:

• Market Research, Business Development, Representation, Agency;

• Investment Advisory, Due Diligence, Market Entry Strategy;

• Myanmar Local Partner : Evaluation, JV, Convert MCIL to FIL Permit;

• Liaison with Govt. Dept. & Ministries, Contract Negotiation,

• MIC - Permit, DICA - Company Registration, Office Management;

• Local Content HRM , Recruitment, Training & Development;

• Engineering Services, Project Management, CSR, EIA and SIA.

MiTA Myanmar @ Investment & Strategic Business Consulting is enlisted

as local company with EPD, Ministry of Energy, Govt. of Myanmar.

MiTA Services Pte Ltd, Singapore

MiTA MYANMAR @ ISBC Co Ltd

www.mitaservices.com.sg

ISBC@mitaservices.com.sg

ACKNOWLEDGEMENT

The information and data contained in this presentation

is derived from many sources, own and third party’s,

public and private, and is provided for information

purposes only.

NOTE:

In spite of reasonable efforts to include accurate and up-to-

date information in the presentation, this presentation makes

no warranties or representations or in no way has any

liabilities or responsibility for any errors or omissions in the

content of this report; neither claims any rights in the data or

information used from various sources.

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The Golden Land of

MYANMAR

Infrastructure & Facilities are

very limited in view of about:

- About 60 million people

- Approx. 678,500 SQ KM

area.

Opportunities are so many

Challenges: just like any other

Frontier / Emerging market, with

a few notable Positive Points:

• Intelligent People;

• Many Unconventional Systems

& Indigenous Ways to solve

most difficult problems;

• Skilled Myanmar people living

abroad Significant in

Number.

In Myanmar, SERVICES SECTOR is very small vis-à-vis

the size of Myanmar’s economy:

Major Services Sector encompasses a variety of segments:

• Engineering, Project Management,

• Inspection, Freight, Logistics,

• Banking, Financial & Insurance Services, etc.

which are directly related to the development of any industry;

Other related Services:

• Training & Development, Education,

• Hotel Industry, Tourism,

• Healthcare, etc.

A developed Services Sector can generate a lot of employment, and

create a better society for sustainable economic growth.

Services Sector in Myanmar

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MAJOR INDUSTRIES where there are lots of Opportunities in

Myanmar:

•Oil & Gas,

•Mining,

•Power & Renewable Energy,

•Telecommunication, IT & IT Enabled Services,

•Real Estate & Infrastructure Construction,

•Agriculture, Fisheries and Aquaculture

•Manufacturing, Garments & SME

•Inspection, Freight, Logistics and Trading,

•Medical & Health Care Services

•Hotel & Tourism Industry

•Environment and Waste Management

•Banking, Financial & Insurance Services, etc.

Services Sector in Myanmar

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OPPORTUNITIES in MYANMAR’s OGS SECTOR

MAIN MARKET IS now in Upstream Segment; but

Downstream Segment also has promises.

The OGS Sector is made up of the many businesses

that support exploration and production activities.

The necessary products and services that are to be

provided by companies are categorized into several

interconnected Sector segments covering both

land-based and offshore activities:

Geophysical / Seismic, Drilling

Pipelines, Offshore Platforms

Service, Supply, Manufacturing

FABRICATION – Practically No Fabrication Yard in Myanmar

Installation & HUC, etc.

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Environmental Regulations & Project Development

• Air emissions

• Wastewater / effluent discharges

• Solid and liquid waste management

• Noise generation

• Terrestrial impacts and project footprint

• Spills

The DAWEI project is being developed drawing experience in

building Map Ta Phut, the massive petrochemical complex in

Thailand.

Local residents at Map Ta Phut, Thailand have pointed to data

indicating higher cancer rates and polluted air & groundwater

and government studies have backed them up.

In Myanmar, Opportunities for Business in:

EIA and Environmental Engineering & Management,

SIA and CSR 7

SEZ: DAWEI DEVELOPMENT PROJECT

“An Industrial Project That Can Change Myanmar”

Construction of a deep-sea port would create a shortcut between Europe and Indochina, bypassing the Strait of Malacca.

This has a tremendous potential to develop Myanmar’s Services sector vis-à-vis its neighbouring countries.

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SEZ: DAWEI DEVELOPMENT PROJECT

“An Industrial Project That Can Change Myanmar”

Construction of a deep-sea port would create a shortcut between Europe & Indochina, bypassing the Strait of Malacca.

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• Myanmar’s full membership in the World Bank Group’s

Multilateral Investment Guarantee Agency (MIGA)

• Membership in MIGA means that foreign direct investment

into Myanmar will be eligible for the Agency’s political risk

insurance.

• This insurance protects investments against the risks of

transfer restriction, expropriation, breach of contract, war

and civil disturbance, and non-honoring of financial

obligations.

• Investors from Myanmar going into other developing

countries may also receive coverage for their investments

from MIGA.

Membership in MIGA will be completed once Myanmar makes

its required capital contribution to the Agency.

World Bank Group’s Multilateral Investment Guarantee Agency

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When do you need a MIC Permit?

Procedures & Times Frame for MIC Permit Application:

• EIA / Environment Management Plan and SIA.

• Prepare Documentation as per “Required Documents”

for Investment Permit Application, stipulated in FIL.

• Submit Application

• Review, Evaluation and Meeting of Investment Proposal

Assessment Team (PAT) … ~ within 15 days from the date

of submitting proposal with completed documents.

• Processing of Application for MIC Approval / Permit - The

process to obtain MIC permit may take about 45 days.

Procedure after the MIC approval.

Guarantee under the Foreign Investment Law (FIL).

Other Incentives including Tax Benefits.

Myanmar Investment Commission (MIC) Permit

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Business Operation in Myanmar can be carried out through one

of the following business organizations:

Partnership

Companies limited by shares:

Joint Venture companies between local Myanmar &

Foreign companies;

Local Myanmar companies;

Foreign companies;

Branch or Representative office of a foreign company;

Associations not for profit (NGO).

Business Organizations – Myanmar Company’s Law

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Some of the KEY POINTS, which any Investor need to know, are

listed below:

Restricted Activities & Eligible Economic Activities for Foreign

Investors

Tax Incentives – All Foreign Investors are not eligible to get Tax

Incentives in Myanmar.

Bank Account Opening & Transfer of Foreign Currency.

Right to use land, Land Lease Tenure, Rental: Under MIC Permit

and for other Investors.

Employment:

Local Contents;

Availability of Skilled & Semi-skilled Workers and Training

Needs

Procedure to apply certificate for work permit & requirements;

Minimum Wages & Termination Benefits.

Doing Business in Myanmar

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The application for registration is to be accompanied by the

following documents:

• Memorandum and Articles of Association duly stamped and printed

both in Myanmar and English;

• Declaration of registration;

• Declaration of legal and official version of the documents;

• Declaration of the situation of registered office;

• Translation certificate by a competent translator;

• List of Directors;

• List of person(s) authorized to accept services of process and notice

in Myanmar on behalf of the company ( i.e., for a branch office of a

foreign company ):

• A copy of Permit & Decision of the Myanmar Investment Commission

for the Manufacturing, Hotel & Construction businesses;

• Passport copy or NRC copy of each shareholder and director;

• Undertaking NOT to do Trading Activities.

Company Registration Application to DICA

In Myanmar, Foreign Investment Law was promulgated in

1988; and in Nov 2012, Myanmar’s New Foreign Investment

Law has been enacted by the democratic government.

Special Economic Zone Law ( SEZ Law) and Dawei Special

Economic Zone Law ( DSEZ Law ) were enacted in 27th

January, 2011.

Myanmar also designated 24 development zones in the

country, carrying out major projects.

In the industrial sector, it has set up 19 industrial zones

across the country to encourage private sector to run

industrial enterprises for the development of the sector. 7

new industrial zones are in planning stage.

On 29 July 2013 a new Myanmar Citizens Investment Law

(MCIL) was enacted, which revokes the previous Myanmar

Citizens Investment Law notified on 31 March 1994.

New Foreign Investment Law, SEZ Laws & MCIL

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LOCAL CONTENT in MYANMAR

The Myanmar SEZ Law – 2011 consists of 12 chapters. Some

points related to Local Content are:

The SEZ law is designed to provide jobs for Burmese citizens.

Section 11 of the law under “Matters Relating to Labour” specifies

that investors “in employing citizens, skilled workers, technicians

and staff for expert work, [employers] shall employ at least 25 per

cent of citizens at the expiry of the first five years, 50 per cent at

the expiry of the second five years and 75 per cent at the expiry

of the third five years from the commencement year of the

business’.

Myanmar’s New Foreign Investment Law also have similar

provisions.

OPPORTUNITIES in Training & Education and Technical

Manpower Development sectors.

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Myanmar Citizens Investment Law (MCIL), July 2013

According to the Myanmar Citizens Investment Law, any

Myanmar Investor can carry out either, form of the following:

• 100 percent local capital contributed by the citizens

• Joint venture between citizen and the government

department and organization;

• Various form of cooperation system between government

and private including BOT system and any other form

according to the Joint Venture Agreement;

Tax Incentive under the Myanmar Citizens Investment Law.

Employment of Foreign Nationals under MCIL vis-à-vis FIL:

Employees Personal Income Tax Rate: 35% , 20%.

Conversion of Investment Permit under Myanmar Citizens

Investment Law to Foreign Investment Law

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Some of Concerns of Foreign Investors: the list is longer than the one presented below

Foreign investors will have a number of concerns including the

following, while doing Commercial Due Diligence:

Governing Law.

Dispute Resolution: UNCITRAL Arbitration Rules. Myanmar has

deposited its instrument of accession without reservations to

become a contracting state of the New York Convention on the

Recognition and Enforcement of Foreign Arbitration Awards.

Restrictions on foreign ownership.

Oil & Gas: Pending New Petroleum Law, it is unclear how the

proposed law would impact the terms of PSCs for oil & gas

explorations in Myanmar.

Mining: How New Mining Law of Myanmar will impact mining

sector in Myanmar?

Power: New Electricity Law, Revised Power Tariffs, IPP & PPA,

Power Trading, Availability of Assured Power Supply, etc. 18

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Importance of Understanding Culture & Religion

This Picture is from “Latitude”

in-flight magazine of

AMERICAN EAGLE.

www.reuters.com: Australian brewery apologizes

for using

Hindu deities on beer bottles.

Poverty, Donations & Respect ...

the Myanmar way.

Thank You &

Welcome to do business in Myanmar;

we are at your service.

MiTA Myanmar & MiTA Services Pte Ltd. (Singapore)

Email: isbc@mitaservices.com.sg

Ph: +95 9420110666, +95 9420110451

MiTA Services Pte Ltd, Singapore

MiTA MYANMAR @ ISBC Co Ltd

www.mitaservices.com.sg

ISBC@mitaservices.com.sg