investment guide ( english)

7/29/2019 Investment Guide ( English)

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Guide For Foreigner(s)

Doing business in MyanmarCONTENTS

(1) INVESTMENT LAW ............................................................................... 2

(2) EQUITY .................................................................................................... 3

(3) MINIMUM INVESTMENT LEVEL ........................................................3

(II) APPLICATION ....................................................................................... 4

(1)AGENCY/IES INVOLVED IN ADMINISTERING INVESTMENT APPLICATIONAND GRANTING OF INCENTIVES ............................................................ 4

(2) CONDITIONS INCLUDING TIMETABLE FOR PROCESSING OFAPPLICATION ............................................................................................... 4

(III) RESTRICTIONS .....................................................................................5(IV) FOREIGN EQUITY POLICIES ............................................................. 5

(1) EQUITY REGULATIONS ........................................................................ 5

(V) INCENTIVES .......................................................................................... 5

(1) CORPORATE INCOME TAXES/INCOME TAX ALLOWANCE ........5

(2) EXEMPTION FROM OR REDUCTION OF TAXES ON IMPORTED CAPITALGOODS ............................................................................................................6

(3) EXEMPTION FROM OR REDUCTION OF TAXES ON IMPORTED RAWMATERIALS ...................................................................................................6

(VI) TAXATION ............................................................................................ 7

(1) CORPORATE TAX .................................................................................. 7

(3) WITHHOLDING TAX ............................................................................. 7

(4) PERSONAL INCOME TAX .................................................................... 7

(VII) FINANCIAL REGULATIONS .............................................................8

(1) BORROWING .......................................................................................... 8

(2) FOREIGN LOAN ..................................................................................... 8

(3) FOREIGN EXCHANGE ...........................................................................8(4) REPATRIATION OF CAPITAL/PROFITS .............................................8

(VIII) EMPLOYMENT FOR APPROVAL OF FOREIGN WORKERS .... ..9

(IX) LAND AND BUILDING OWNERSHIP ............................................... 9

(1) REGULATION ON ACQUISITION OF LAND AND BUILDING ...... . 9


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(2) RESTRICTIONS .......................................................................................9

Appendix ( A ) ............................................................................................... 10

(X) Types of economic activities allowed for foreign investment...............10

Appendix ( B ) ...............................................................................................15

SAMPLE APPLICATION FORM FOR FOREIGN INVESTMENT ...... ....15

Appendix ( C ) ...............................................................................................24

Legislative requirements for Companies .......................................................24

Appendix ( E ) ...............................................................................................30

THE SCHEDULE : FORM - A .................................................................. 30

(I) RELEVANT LEGISLATION

(1) INVESTMENT LAW

The Union of Myanmar Foreign Investment Law (November 1988)

According to the Foreign Investment Law, foreign investment in Myanmar can take oneof the following three forms:

1) Partnerships, limited companies, or wholly foreign-owned subsidiaries.2) Production sharing contracts with one of the State-owned Economic Enterprises(SEEs) for exploration, extraction and sale of petroleum and natural gas and miningoperations.3) Joint ventures, either as partnerships or limited companies with any individual, firm,cooperative, or state-owned enterprise of Myanmar.

Procedures relating to the Union of Myanmar Foreign Investment Law (December

1988)

A foreign investor who intends to invest in Myanmar is required to apply a permitfrom the MIC (Myanmar Investment Commission) if he wishes to be consideredfor incentives and exemptions under the Foreign Investment Law. The applicationprocedure is as follows:

A potential Foreign investor, or promoter, must submit the investment proposal tothe MIC in a prescribed form, which can be obtained at the following address:

Directorate of Investment and Company AdministrationNo.653/691, Merchant Street, Pabedan T/S, Yangon.The Union of Myanmar

The investment proposal has to be supported by the following documents:

business profiles and documents supporting financial credibility such as the latestaudited accounts of the person or the firm intending to make the investment,

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bank reference and recommendation regarding the potential foreign investorsbusiness standing; and

detailed calculation relating to the economic justification of the proposed projectindicating :

- the estimated annual net profit, annual income and expenditure statement;

- annual production/services, annual cash flow statement;- the estimated annual foreign exchange earnings and requirements;- recoupment period;- prospects of creating employment;- prospects of increasing national income;- local and foreign market conditions;- requirement for local consumption;- prospects of foreign exchange savings.

Notes:

i. If the proposed project is a 100% direct foreign investment, a draft contract executed

with a State organization that is responsible for the smooth operation of enterprise in therespective field must also be attached;ii. If the proposed project is a joint-venture, a draft contract between the foreign investorand the local counterpart must also be attached;iii. If the proposed project involves leasing of land, a draft lease agreement must also be

attached; andiv. If the proposed joint-venture in Myanmar is in the form of a limited liability company,a draft Memorandum and Articles of Association must also be attached.

(2) EQUITY

If a joint venture is formed, at least 35% of total equity could be owned by foreigninvestor.

(3) MINIMUM INVESTMENT LEVEL US$ 500,000 for manufacturing; US$ 300,000 for services.

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(II) APPLICATION

(1)AGENCY/IES INVOLVED IN ADMINISTERING INVESTMENT

APPLICATION AND GRANTING OF INCENTIVES

The Myanmar Investment Commission (MIC)

Directorate of Investment and Company AdministrationNo.653/691, Merchant Street, Pabedan T/S, Yangon.The Union of Myanmar

(2) CONDITIONS INCLUDING TIMETABLE FOR PROCESSING

OF APPLICATION

The following are the application procedures:

A promoter for foreign investment shall submit a proposal in the prescribed form toMIC. The MIC will issue a Permit if the proposal is approved.

If the approved economic activity is to be formed as a limited company, it must applyfor Permit from the Ministry of National Planning and Economic Development throughthe Company Registration Office.

After being granted a Permit, the company must be registered with the CompanyRegistration Office under the Ministry of National Planning and Economic Development.

A company involved in foreign trade has to apply for registration as an

exporter/importer with the Ministry of Commerce.

The duration for processing an application will take 4-6 weeks if the documents are inorder and complete Proposal Form attached. (Refer to Section 1 Procedures relating tothe Union of Myanmar Foreign Investment Law).

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(III) RESTRICTIONS

The Economic Enterprises that are to be carried out solely by the Government (as statedin Section 3 of the State-Owned Economic Enterprises Law) are as follows:

(a) extraction of teak and sale of the same in the country and abroad;

(b) cultivation and conservation of forest plantation with the exception of village-ownedfire-wood plantation cultivated by the villagers for their personal use;(c) exploration, extraction and sale of petroleum and natural gas and production ofproducts of the same;(d) exploration and extraction of pearls, jade and precious stones and export of the same;(e) breeding and production of fish and prawns in fisheries which have been reserved forresearch by the Government;(f) Postal and Telecommunications Service;(g) Air Transport Service and Railway Transport Service;(h) Banking Service and Insurance Service;(i) Broadcasting Service and Television Service;

(j) Exploration and extraction of metals and export of the same;(k) Electricity Generating Services other than those permitted by law to private and co-operative electricity generating services;(l) Manufacture of products relating to security and defence which the Government has,from time to time, prescribed by notification.

(IV) FOREIGN EQUITY POLICIES

(1) EQUITY REGULATIONS

100% foreign equity ownership is allowed according to the Foreign Investment Law.

Foreign investor may enter into a joint venture, either as a partnership or a limitedcompany with any individual, firm, co-operative, or State-owned enterprise of Myanmar

In the case of a joint venture, the foreign capital must be at least 35% of the total equitycapital.

(V) INCENTIVES

(1) CORPORATE INCOME TAXES/INCOME TAX ALLOWANCE granted a minimum of 3 year corporate income tax exemption.

extendible on a case-by-case basis.

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(2) EXEMPTION FROM OR REDUCTION OF TAXES ON

IMPORTED CAPITAL GOODS

During the construction, exploration and development period of the investment project;

grants exemption from customs duty and

other internal taxes on imported capital equipment and materials.

During the construction period as mentioned in the proposal form or extendedconstruction period approved by MIC, the investor can enjoy this exemption.

(3) EXEMPTION FROM OR REDUCTION OF TAXES ON

IMPORTED RAW MATERIALS

During the first 3 years of commercial production and operational period,

exemption from customs duty and

other internal taxes on imported raw materials is granted.

The investor has to inform MIC the commenced date of commercial operation forapproval. After getting MIC approval, the investor can enjoy the exemption on importedraw materials.

It is necessary to mention the performance of the project in applying the aboveincentives.

(4) OTHER INCENTIVES (I.E. GRANTS, DOMESTIC LOANS,

SUBSIDIES, ETC.)

Exemption or relief from income tax on profits which are maintained in areserved fund and re-invested within one year.

Right to accelerate depreciation.

Relief from income tax up to 50% on the profits accrued from exports.

Right to pay income tax on behalf of the foreigners employed and to deduct thesame from the assessable income of the enterprise.

Right to pay income tax of the foreign employees at the rates applicable to thecitizens of Myanmar.

Right to deduct the expenditures for research and development carried out withinthe State.

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Right to carry forward and set off losses up to 3 consecutive years, from the yearthe loss is made.

(VI) TAXATION

(1) CORPORATE TAX

Treated as resident- taxed at the rate of 30% on income accruing or arising in Myanmar and outside ofMyanmar.

(2) COMMERCIAL TAX (Value added Tax)- ranging from 0%-200%.- Payable on goods imported or produced in Myanmar, trading sales, and services.

(3) WITHHOLDING TAX

Withholding tax rates (could range from 3.5 % to 15 %)Depending on the types of payments (interest, royalties, and payment for the work doneunder different kinds of organisations)Different rates of withholding tax: Interests:

- For resident citizens and resident foreigners= 15%- For non-resident foreigners= 20%

Royalties for the use of license, trade marks, patent rights, etc.:- For resident citizens and resident foreigners= 15%

- For non-resident foreigners= 20% Payment on contracts undertaken by State organisations, development committees andcooperative societies:

- For resident citizens and resident foreigners= 3%- For non-resident foreigners= 3.5%

Payment for work done to foreign contractor:- For resident citizens and resident foreigners= 2.5%- For non-resident foreigners= 3%

(4) PERSONAL INCOME TAX

1. A resident foreigner2. A non-resident foreigner

4.1. A resident foreigner (A foreigner staying in Myanmar for 183 days or more isconsidered a resident foreigner.)

- taxed on salaries based on progressive scale,- starting at 3% and rising to a maximum rate of 30%.

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4.2. A non-resident foreigner- at the flat rate of 35%, or- at progressive rates ranging from 3% to 50%, whichever is greater.

(VII) FINANCIAL REGULATIONS

(1) BORROWING

Domestic borrowing in foreign currency is not available.

Domestic borrowing in local currency can be provided by the commercial banks

operating in the country.

(2) FOREIGN LOAN

There is a 15% withholding tax for interest paid to non-resident lender.

(3) FOREIGN EXCHANGE

Foreign borrowings and foreign equity investments would require prior approval fromMIC.All foreign investments should be registered with MIC to enable applications for capital

repatriation and profit remittance.

(4) REPATRIATION OF CAPITAL/PROFITS

Remittance of profit and capital repatriation are subject to prior approval of MIC and arealso subject to Foreign Exchange Regulations.

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(VIII) EMPLOYMENT FOR APPROVAL OF FOREIGN WORKERS

(1) CONDITIONS OF APPROVAL OF FOREIGN EMPLOYEES

(MANAGERIAL, SUPERVISOR, EXPERTISE)

In appointing personnel in an organisation formed under the Permit issued by MIC,preference shall be given to citizens. However, MIC can consider the request forappointment of experts and technicians from abroad on a case-by-case basis.

(IX) LAND AND BUILDING OWNERSHIP

(1) REGULATION ON ACQUISITION OF LAND AND BUILDING

Foreigners cannot own land.Can lease it for periods up to 30 years, or more if approved by MIC.The lease can be extended if the project is mutually beneficial between the Investor andthe State.

(2) RESTRICTIONS

cannot lease any immovable property from the private sector more than one year at atime.

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Appendix ( A )

(X) Types of economic activities allowed for foreign investment.

The following list of economic activities in which foreign investment may be made: -List of Economic Activities

Sr.No Type of Economic Activities

1 Agriculture

1Cultivating, producing, processing and marketing of seasonal agriculturalcrops (including tapioca and tobacco).

2Establishing of plantations, (including medicinal plants, coffee, tea, palm oil,horticulture, etc.)and producing, processing and marketing of their produce.

2 Livestock and Fishery

1Livestock breeding, processing, canning and marketing of livestock and itsproducts (including pig breeding and pork processing, etc.)

2Production and marketing of animal feeds, additives, supplements andveterinary medicines.

3

Breeding, fishing, processing and marketing of fresh water and marine fish,prawns and other aquatic organisms (including fish fry), fingerlings, post

larvae of shrimp, but not including breeding and production of fish and prawnsin fisheries which have been reserved for research by the Government.

4 Production, processing, marketing of all kinds of fish feeds.

3 Forestry

1Production and marketing of basic construction material, furniture, parquet,etc., using teak extracted and sold by the State-owned economic organizations.(To be carried out jointly with the State-owned economic organizations.)

2Production and marketing of carvings and handicrafts made of teak that hasbeen extracted and sold by State-owned economic organizations engaged inthe extraction and marketing of the same.

3Products, processing and marketing of hardwoods (other than teak), bamboo,cane/rattan and other forest produce.

4Production and marketing of construction material, furniture and otherproductions using hardwoods (other than teak), bamboo, cane/rattan and otherforest produce.

4 Mining

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1Exploration, exploitation, production and marketing of non-metallic industrialminerals, such as coal, limestone, gypsum.

2 Marble quarrying and production and marketing of marble blocks and slabs.

3 Carrying out other quarrying industries and marketing of products thereof.

5 Industry

(1) Foodstuff

1Manufacturing and marketing of bakery products including biscuits, wafers,noodles, macaroni, spaghetti, etc.

2Manufacturing and marketing of all kinds of confectionery including those ofsweets, cocoa and chocolate.

3 Preserving, manufacturing, canning and marketing of other food products.

4Processing, manufacturing and marketing of oil and fats from vegetables,animals and other substances.

(2) Textile

1Combing, spinning, weaving, finishing and marketing of textile materials ofcotton, jute, silk wool, synthetic fibers, mixed fiber and other fibers of allkinds.

2Manufacturing and marketing of made up apparel of all kinds includingknitwear.

3Manufacturing and marketing of made up apparel materials of all kindsincluding towels, linens of all kinds, rug and carpets.

4 Manufacturing and marketing of cordage, rope and twine of all kinds.

(3) Personal Goods

1Manufacturing and marketing of soap of all kinds, dentifrices, cosmetics,perfume and toilet preparations.

2Manufacturing and marketing of all kinds of personal goods not elsewherespecified, including umbrella, safety matches, etc.

3 Manufacturing and Marketing of jewellery.

(4) Household

1Manufacturing and marketing of household goods such as textile, glass,

plastic, melamine, metal products, ceramic and earthenware.

2Manufacturing and marketing of non-electrical household goods such asenamelware, cutlery, crockery of all kinds.

3Manufacturing and marketing of electrical household goods and appliances,such as refrigerators, air conditioners, hot plates, irons, cookers, fans and otherhome use appliances.

4 Manufacturing and marketing of radios, transistors, television receivers,

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videos, etc.

5

Manufacturing and marketing of electrical fittings and fixtures, electric lamps,bulbs and tubes, etc.

(5) Leather Products and the Likes

1Processing of hides, skins and leathers of all kinds, excluding synthetic leather,and manufacturing and marketing thereof, including footwear, handbags etc.

2Processing of synthetic and artificial leather and manufacturing and marketingthereof, including footwear, handbags etc.

3 Processing and marketing of furs and skins not elsewhere specified.

(6) Transport Equipment

1Manufacturing and marketing of bicycles, tricycles and other cycles of all

kinds, component parts and accessories.

2Manufacturing and marketing of scooters, motor cycles, mopeds, etc.component parts and accessories.

3Manufacturing and marketing of motor cars, buses, trucks, vans, wagons,component parts and accessories.

4Manufacturing and marketing of tractors of all kinds, ambulances, fire engines,dump trucks, bowsers and other occupational motor vehicles, component partsand accessories.

5Manufacturing and marketing of tires, tubes and flaps for all kinds of vehiclesand other purposes.

(7) Building Materials

1Manufacturing and marketing of bricks, tiles, floor tiles and wall tiles,refractory bricks, etc.

2 Manufacturing and marketing of asbestos building materials of all kinds.

3Manufacturing and marketing of cement of all kinds, cement products, limes,plaster and related manufactures.

4Manufacturing and marketing of prestressed concrete pipe, plant and otherconcrete products.

5 Manufacturing and marketing of all kinds of glass and glass products.(8) Pulp and Paper

1Manufacturing and marketing of pulp of all kinds, paper and paper board of allkinds including newsprint.

2Manufacturing and marketing of paper, paper board including carbon paper,waxed paper, toilet paper, etc.

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(9) Chemicals, Chemical Products and Pharmaceuticals

1Manufacturing and marketing of all kinds of basic chemical, organic andinorganic including caustic soda, chlorine, stearic acid, etc.

2Manufacturing and marketing of all kinds of light chemicals, not elsewhere

specified.3 Manufacturing and marketing of all kinds of plastic wares.

4Manufacturing and marketing of chemical products, such as paint, varnishes,dyes, thinner and lacquers, etc.

5Manufacturing and marketing of industrial chemical gases includingcompressed, liquefied and solid forms.

6 Manufacturing and marketing of ice in all forms.

7 Manufacturing and marketing of medicine, pharmaceuticals and drugs, etc.

8 Manufacturing and marketing of insecticides, pesticides, etc.

9 Manufacturing and marketing of rubber products.

10 Recycling of chemicals, plastic wastes and others and marketing.

(10) Iron and Steel

1Manufacturing and marketing of iron and steel products, using iron and steelpurchased from State-owned economic organizations or from abroad.

2Manufacturing and marketing of basic iron and steel products using iron andsteel purchased from State-owned economic organizations or from abroad.

3Manufacturing and marketing of basic nonferrous metal products of all kindsusing metals purchased from State-owned economic organizations or fromabroad.

4Manufacturing and marketing of pre-fabricated and structural products of allkinds including construction and building parts.

(11) Machinery and Plant

1Manufacturing and marketing of all kinds of agricultural machinery andagricultural equipment.

2Manufacturing and marketing of all kinds of machinery and equipment usedfor extraction of timber.

3Manufacturing and marketing of all kinds of mining machinery andequipment.

4Manufacturing and marketing of all kinds of machinery and equipment forother industrial purposes including wood-based industries.

5Manufacturing and marketing of scientific, medical, surgical, optical and allother professional machinery, equipment and accessories.

6 Manufacturing and marketing of machinery, equipment and accessories

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required for the production and distribution of electricity including cable,switches, transformer, generator, battery, etc.

7Manufacturing of machinery, equipment and accessories required for all kindsof telecommunication including wireless sets, telephone, etc. and marketingunder the permission of the Government.

8 Manufacturing and marketing of pumps all kinds.

9Manufacturing and marketing of all kinds of machinery and equipment notelsewhere specified, including piston, piston rings, injection pump andnozzles, casting parts, forging parts pressure vessel, etc.

10 Manufacturing of small plants.

11 Manufacturing and marketing of all kinds of machine tools.

12Manufacturing and marketing of all kinds of cables, ropes, twine, chain andsimilar products.

13 Manufacturing and marketing of cinematographic and photographic films,cassette and video tapes and related electronic and electrical products.

14 Manufacturing and marketing of clocks and watches of all kinds.

15Manufacturing and marketing of fountain pens, ball pens, pencils and similarwriting gears.

16Manufacturing and marketing of all kinds of toys, mechanical and non-mechanical.

17Manufacturing and marketing of machinery and equipment not elsewherespecified.

6 Construction

1Construction enterprises undertaking domestic and overseas constructionworks.

2Installation of machinery plants and equipment and provision of trial and testrun service.

7 Transport and Communications

1 Road transport and vehicles repair services.

2 Inland water transport services.

3 Dockyard services.

4 Shipping agency services.

8 Trade

1 Hotels and Tourist Industries.

9Economic activities to which the State-owned Economic Enterprises Lawapplies

1 Economic activities mentioned in section 3 of the State-owned Economic

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Enterprises Law, provided permission has been obtained under section 4 of thesaid Law.

Note: If proposals for economic activities not specified in the above mentioned list aresubmitted, they will be considered individually by the MIC.

Appendix ( B )

SAMPLE APPLICATION FORM FOR FOREIGN INVESTMENT

Proposal of the Promoter to make Foreign Investment in the Union of Myanmar

ToThe Chairman,The Union of Myanmar Foreign Investment Commission,Yangon,The Union of Myanmar.

Reference No.Date

I wish to make investment in the Union of Myanmar in accordance with the Union ofMyanmar Foreign Investment Law, and I herewith apply for permission furnishing thefollowing particulars-1. Promoter's-(a) Name ............................................................................................(b) Father's name ................................................................................(c) National registration No. ..............................................................(d) Citizenship ....................................................................................(e) Address .........................................................................................(f) Name of principle organization .....................................................(g) Type of business ...........................................................................(h) Place of organization ....................................................................(i) Place of incorporation ..................................................................2. If investment is to be made by joint-venture, the particulars of the persons wishingto participate in the joint-venture with the promoter-(a) Name ............................................................................................(b) Father's name ................................................................................(c) National registration No. ..............................................................(d) Citizenship ...................................................................................(e) Address ........................................................................................(f) Name of principle organization ....................................................(g) Type of business ..........................................................................(h) Place of organization ....................................................................(i) Place of incorporation ..................................................................

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3. Type of business in which investment is to be made-(a) Production ...................................................................................

(b) Services ........................................................................................(to indicate name of goods or type of services)4. Form of economic organization-

(a) Sole Proprietorship .......................................................................(b) Partnership ....................................................................................(c) Limited Company ......................................................................(to enclose the list of the name, citizenship, address and designation of the executives ofthe organization, indicating the local and foreign capital ratio)

5. If the organization is in the form of a partnership-(a) Capital ratio and amount to be contributed by the partners......................................................................................................(b) Profit sharing ratio .......................................................................

(c) Rights and liabilities of partners .................................................6. If the organization is in the form of a limited company-(a) Authorised capital ........................................................................(b) Types of shares .............................................................................(c) Share capital to be subscribed by the shareholders ..............................................................................................................................7. Particulars relating to the organization in which investment is to be made-

(a) Amount of capital-Kyat

(1) Amount of local capital to be contributed ..................(2) Amount of foreign capital to be brought in ..................

____________Total -

____________

(b) Amount of foreign capital to be brought in-Kyat

(1) Foreign currency ..................(2) Others ..................

____________Total -

____________(c) Period for bringing in items mentioned in sub-paragraph (b).................................................................... ..................................(d) Proposed duration of investment ...................................................(e) Construction period .......................................................................(f) Commencement of construction ....................................................

8. Particulars relating to the proposed economic organization-

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(a) Type of business ..........................................................................(to indicate production/services etc.)(b) Proposed place(s) at which investment is to be made ........................................................................................................................(c) Technique of operation ................................................................

(d) Annual fuel requirement ..............................................................(to indicate type/quantity)(e) Annual electricity requirement ....................................................(f) Annual water requirement ...........................................................(to indicate daily requirement, if any)(g) Annual equipment/raw materials requirement .............................(to enclose a list of type/quantity/value)(h) Building requirement ...................................................................(i) Type of land and area requirement ..............................................(j) Goods to be produced/services to be rendered .............................(to indicate name, type, annual estimated quantity and value of the goods/services)

(k) System of sales .............................................................................9. Details of foreign capital to be brought in-Foreign Estimated Kyat

Currency Equivalent(a) Foreign currency ............... ......................(type and amount)(b) Value of machineries, equipment etc. ............... .....................(to enclose detail statement)(c) Value of raw materials and other ............... .....................similar materials(d) Value of rights which can be evaluated, ............... .....................such as license, trade mark, patent rights(e) Value of technical know-how ............... .....................

__________ ______________Total

__________ ______________10. Details of local capital to be contributed -

Kyat(a) Amount of cash ..................(b) Value of machineries and equipment ..................(to enclose detail statement)(c) Buildings/Land ..................(d) Value of furniture and office equipment ..................(to enclose detail statement)(e) Value of raw materials ..................(to enclose detail statement)

____________Total -

____________11. Particulars relating to annual production/services-

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Foreign Estimated KyatCurrency Equivalent

(a) Type and value of foreign exchange ............... .....................required(b) Amount of foreign exchange to be ............... .....................

received(c) Amount of working capital ............... .....................requirement in Kyat(d) Value of exportable goods/services ............... .....................

(e) Value of annual local sale of goods /services ............... .....................

12. List of personnel required for the proposed economic organization-(a) Local personnel required-

Serial No. Type of personnel Number................. ............................... .........................

................. ............................... .........................(b) Foreign experts and technicians required-Serial No. Type of expertise Number Proposed period of employment................. ........................ ............. ... ..............................13. Particulars relating to economic justification-

Foreign Estimated KyatCurrency Equivalent

(a) Annual income ............... .....................(b) Annual expenditure ............... .....................(c) Annual net profit ............... .....................(d) Yearly investments ............... .....................(e) Recoupment period ............... .....................(f) Other benefits ............... .....................(to enclose detail calculations)(g) To mention prospects of new employment opportunities/local and foreign marketconditions/foreign exchange savings ............... .....................14. Supporting documents for the proposal-

The following documents are attached for the proposed investment-(a) Draft contract;(b) References for business and financial standing;(c) Drafts of Memorandum of Association and Articles of Association.

Signature ..........................Name ................................Designation .......................

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Data on Foreign Investment, Local Investment and Company Registration Up to 31-10-2007, the accumulated pledged amount of foreign direct investment is US$ 14736.279million. By sector and by country FDI data are as follows:-

FOREIGN INVESTMENT OF PERMITTED ENTERPRISES AS OF (31/8/2008)

(BY COUNTRY)( US $ in million )

Sr.No

Particulars

Permitted Enterprises

No.ApprovedAmount

%

1 Power 2 6311.222 40.46

2 Oil and Gas 85 3243.478 20.80

3 Manufacturing 154 1629.128 10.44

4 Mining 60 1395.886 8.95

5 Real Estate 19 1056.453 6.77

6 Hotel and Tourism 43 1034.561 6.63

7 Livestock & Fisheries 25 324.358 2.08

8 Transport & Communication 16 313.272 2.01

9 Industrial Estate 3 193.113 1.24

10 Construction 2 37.767 0.24

11 Agriculture 4 34.351 0.22

12 Other Services 6 23.686 0.15

Total 419 15597.275 100.00

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FOREIGN INVESTMENT OF PERMITTED ENTERPRISES AS OF (31/8/2008)

(BY COUNTRY)( US $ in million )

Sr.No

Particulars

Permitted Enterprises

No.ApprovedAmount

%

1 Thailand 58 7391.843 47.39

2 U.K* 50 1860.954 11.93

3 Singapore 71 1520.213 9.75

4 China 28 1331.439 8.54

5 Malaysia 33 660.747 4.24

6 Hong Kong 31 504.218 3.23

7 France 2 469.000 3.01

8 U.S.A 15 243.565 1.56

9 Republic of Korea 37 243.308 1.5610 Indonesia 12 241.497 1.55

11 The Netherlands 5 238.835 1.53

12 India 7 219.575 1.41

13 Japan 23 213.004 1.37

14 Philippine 2 146.667 0.94

15 Australia 14 82.080 0.53

16 Austria 2 72.500 0.46

17 Canada 14 39.781 0.26

18 Cyprus 2 38.250 0.25

19 Panama 1 29.101 0.19

20 Germany 2 17.500 0.11

21 Denmark 1 13.370 0.09

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22 Macau 2 4.400 0.03

23 Viet Nam 1 3.649 0.02

24 Switzerland 1 3.382 0.02

25 Bangladesh 2 2.957 0.0226 Israel 1 2.400 0.02

27 Brunei Darussalam 1 2.040 0.01

28 Srilanka 1 1.000 0.01

Total 419 15597.275 100.00

Inclusive of enterprises incorporated in British Virgin Islands, Bermuda Islands andCayman Islands.

Up to 31-10-2007, the accumulated amount of Myanmar Citizen investment realized

Kyats 141381.34 million. By sector and by country Myanmar Citizen investment data areas follows:-

Up to 31-8-2008, registered Companies and Business organizations are as follows :-

Number

- Myanmar Company 17216

- Foreign Company/ Branches 1261

- Partnership 1072

- Joint Venture Company 69

- Association 41

19659

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BUSINESS ORGANIZATION

Registration of business OrganizationOperation in Myanmar can be carried out through one of the following businessorganizations.

1. Partnerships2. Companies limited by shares. i.e. joint venture companies; local companies; foreigncompanies.3. Branch or Representative offices of a foreign company4. Associations not for profit

The application for PERMIT is to be accompanied by the following documents:

(1) Form A of the Myanmar Companies Regulation 1957.(2) Draft Memorandum and Articles of Association(3) Duly completed questionnaire form

(4) Intended activities to be performed(5) Estimated expenditures to be incurred in Myanmar for the first year operations(6) Financial credibility of the company/individual(7) Board of Directors resolution, if the subscriber is a company.

In the case of a foreign branch/representative office, the following shall be furnished inaddition to the above mentioned documents.

(1) Instead of the companies draft Memorandum and Articles of Association, a copy ofthe Head Offices Memorandum and Articles of Association or of the Charter, Statute orother instruments constituting or defining the constitution of the company, duly notarized

and consularized by the Myanmar Embassy concerned in the country where the companyis incorporated.

(2) The Annual Report for the last two financial years (OR) if it is the copies of the HeadOffice Balance Sheet and Profit and Loss accounts for the last two financial years, it is tobe notarized and consularized by the Myanmar Embassy concerned in the country wherethe company is incorporated.

(3) Where the original Memorandum and Articles of Association and other relevantdocuments are not in English language, authentication of the translation into English.The application for registration is to be accompanied by the following documents.

(1) Two sets of Memorandum and Articles of Association duly stamped and printed bothin Myanmar and English.(2) Declaration of registration(3) Declaration of legal and official version of the documents(4) Declaration of the situation of registered office(5) Translation certificate by a competent translator(6) List of Directors

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(7) List of person(s) authorized to accept services of process and notice in Myanmar onbehalf of the company (i.e. for a branch office of a foreign company.)

For a Public company, the following additional documents shall be submitted beforecommencing the business

(1) List of person to act as directors(2) List of person who have consented to act as director(3) Agreement to take qualification shares.

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Appendix ( C )

Legislative requirements for Companies

The legal requirements for the companies to comply under the Myanmar Companies Act1914 are as follows:-

NameThe name of the company shall be painted or affixed on the outside of its registeredoffice and every place of business. It must also be engraved in legible characters on itsseal and mentioned in all letterheads, notices, advertisements and other officialpublications, etc.

Registered Office

Every company must have a registered office in Myanmar to which all communicationsand notices may be addressed. A notice of situation of the initial registered office must befurnished to the CRO when filing the incorporation documents. If the address issubsequently changed, notice must be given to the CRO within 28 days of the change.

Directors

Every private company is required to have at least 2 directors. A public company musthave a minimum of 3 directors. An undercharged insolvent is not eligible to be a director.A return of particulars of Directors, Managers and Managing Agents and of any changesthere in must be lodged with the CRO within 14 days of the appointment or changes.

Allotment of SharesEvery company will have to give notice to the CRO of any allotment of shares within

one month of the date of allotment.

Annual General Meeting

Every company must hold an annual general meeting once in every calendar year to layits audited documents before its shareholders. A newly incorporated company is requiredto hold its first annual general meeting within 18 months of incorporation. Subsequentannual general meetings must be hold once in every calendar year and not more than 15months after the last general meeting. The interval between the date of the financial yearon which the audited accounts are made up and the date of the annual general meeting

must be not more than 9 months.Every company must file and Annual Return within 21 days after its annual generalmeeting. The annual audited accounts are required to be filed with the Annual Return.

Extraordinary and Special Resolutions

Every company is required to lodge a copy of every extraordinary and special resolutionwith the CRO within 15 days from the date of passing there of.

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Statements, Books and Accounts

Every company must maintain proper books of accounts which are required to be kept atthe registered office of the company.

Consequences of Non-compliance There are penalties for the company and its offices for

any non-compliance with the law.

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Appendix ( D ). QUESTIONNAIRE(Foreign Company incorporated in Myanmar) For assessment of Applicationreceived for issue / Renewal of Permit under section 27A of

the Myanmar Companies Act and the Myanmar Companies Regulation, 1957.---------------------------------------------------------------------------------------------------

A. Name of Company :B. Address :C. Old Company in business

in liquidation :D. New Company to be incorporated :

Seq Particulars Remarks

1.0FINANCIAL POSITION

(In the case of a companycarrying on business)

1.1 Capital(i) Authorised(ii) Issued and Paid Up Capital(iii) Shareholders Equity Capital

Issued and Paid-UpReserves and RetainedEarningsTotal Equity

Q. (i) Is the Issued and Paid-Up Capital Strong?A.........................................................Q. (ii) Is the shareholders Equity Strong?

A..........................................................

1.2Change in Financial Position Increase/Decrease in WorkingCapitalQ. Is the Working Capital Improving?A..........................................................

1.3Trend in Income / Expenditure , etc.

Gross IncomeOperation ExpenditureGross Profit

AdministrationTaxationNet Profit after Tax


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2.0Q.PRESENTATION OF FINANCIAL STATEMENT

(Based on statement filed in accordance with the MyanmarCompanies Act.)(In the case of a Company carrying on business)

2.1Q. Are these statement audited by a qualified accountant, and bywhom?A..........................................................

2.2Q. Are books maintained in accordance with Section 130 of theMyanmar Companies Act and certified by the auditor?A..........................................................

2.3Q. If a holding Company, does Balance Sheet include particularsasto the Subsidiary company, as required Under Section 132 A?A..........................................................

3.0BASIS OF ACCOUNTING

( In the case of a company carrying on business )

3.1Q. Are any sales into Myanmar contracted by the Foreign ParentCompany on behalf of the Company?A..........................................................

3.2Q. Are all such sales invoiced by the Company, or by the ForeignParent Company?

A..........................................................

3.3Q. How is the Company remunerated by the Parent Company onsale contracted by them (3.1)(i) Management Fees? or(ii) Administration Fees? or(iii) Supervision Fees? or(iv) Commission?A..........................................................

3.4Q. Are the above fees due physically remitted to Myanmar.

A..........................................................

3.5Q. In case the parent Company is due by the local Company forsupervision, Management, etc, how are they paid or adjusted?A...........................................................

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4.0TAXATION

(As issue renewal of Permit is dependent on compliance withthe Myanmar Tax Laws)

4.1Q. When was the Company last assessed and taxed to Myanmarincome tax?A. (i) Assessment Year

(ii) Income year ended..........................................................Q. If assessments have been pending, since which year?A. (i) Assessment Year

(ii) Income year ended

4.2Q. Are there any exemptions from Income tax?( State by documentary evidence )A...........................................................

Note : Exemption of tax and duties on imported goods does notamount to exemption of Income tax on the profits of theCompany.

5.0EXCHANGE CONTROL REGULATIONS

( As issue / renewal of Permit is dependent on compliance ofthese Regulations. )

5.1Issued and Paid up CapitalQ. What is the Issued and paid up Capital previously approved

by DICAA..........................................................

5.2Has the capitalization of Reserves and Retained earnings( profits ) beenapproved? If so the amount.A..........................................................

5.3Q. Capital determined to be brought into Myanmar?A...........................................................

5.4 If not brought in why not?A...........................................................

5.5Q. Are any calls on shares called up due and Outstanding?A..........................................................

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5.6Q. If there is an inter-company account with the Parent company,what isthe amount due from the Parent company, and the ratio to Paid-upcapital?A..........................................................


6.0 RENEWAL OF PERMIT

6.1Q. Have the Issued and Paid-up Capital been brought intoMyanmar?A..........................................................

6.2Q. Have new issue and calls on shares been made during thecurrent year? Give details.A..........................................................

6.3Q. Need the Authorized Capital be increased due to thecompanys activities or expansion?A..........................................................

6.4Q. What is the total outside indebtedness of the Company.(i) to local creditors?(ii) to overseas creditors?A..........................................................

6.5Q. What is the Local Debt / Equity Ratio?A..........................................................Q. Is the Company still in solvent financial position?If not, the extent of insolvency.A..........................................................

7.0 MYANMAR COMPANIES ACT.

7.1Q. Is the Application Form A for Permit Complete(i) as to details to be furnished?

(ii) as to attachments required?A..........................................................

7.2Q. In the case of renewal application has compliance, been madeof:(i) Annual requirements under the Myanmar Companies Act?(ii) Reporting of any changes within the prescribed time?A..........................................................

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7.3Q. Have conditions set out in the Permit been complied withfully?A..........................................................

7.4Q. Are there any changes in Memorandum and Articles ofAssociation and the Companys activities which are considered towarrant any changes to the Conditions for which the Permit hasbeen originally issued?A..........................................................

Appendix ( E )

THE SCHEDULE : FORM - A

(I) A copy of the Companys Memorandum and Articles of Association or of thecharter, statutes or other instruments constituting or defining the constitution of theCompany.

(II) Copies of the Companys Balance Sheets and Profit and Loss Accounts for the lasttwo years preceding the application.

Application by a Foreign Company or Company carrying international trade for issueof a permit under Section 27A of the Act.

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(1) Name of Company

(2) Country of incorporation of Company

(3) (a) Names, Addresses the Nationality ofshareholders in case of Companiesincorporated in the Union ofMyanmar.

(b) Number of citizen and / or,non-citizen shareholders togetherwith the number of shares held bythem separately in the case ofCompanies incorporated outside theUnion of Myanmar.

(4) (a) Location of the Companys Head

Office(b) Location of the Companys Principal

office in the Union of Myanmar.

(5) The objects for which the branch officeis formed (field of business)

(6)(a) The amount of capital and the number

of shares into which the capital isdivided.

(b) If more than one class of share isauthorized, the description of eachclass and rights and privilegespertaining to each.

(c) The amount of capital brought or tobe Brought into the Union ofMyanmar.

(d) Whether there is any discriminationamong different classes of

shareholders with regard to numberof votes one may cast.

(7) (a) The maximum amount ofindebtedness, if any, which may beincurred by the Company; and

(b) The prohibition against the

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contracting of debts in excess of thatamount.

(8) The period for which Permit is appliedfor

(9) The officers who are to conduct theaffairs of the Company, duties of each,and the authority of the Board ofDirectors to fill the position above

named.

(10) The number of Directors, the mannerof their appointments and their power.

(11) The names, addresses and nationalityof the Directors for the current year.

(12) The names, addresses and nationalityof the promoters

(13) Statement of compliance with legalrequirements for initial capitalincluding the amount to be paid inbefore commencement of the business.

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