Company Formation in Myanmar

Company Formation in Myanmar

Myanmar is known as the official Republic of the Union of Myanmar. This is one of the large countries present in South East Asia. Myanmar is present between India, Bangladesh, Laos and China. It constitutes one of the largest countries in the mainland of South East Asia. Myanmar has a population of around 50 million. Company Formation in Myanmar is quite straightforward; however it is important to comply with the requirement of local laws for company registration in Myanmar.

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  • Procedure for Company Registration in Myanmar
  • Documents Required for Company Registration in Myanmar
  • Liaising with the concerned regulatory authority for company formation in Myanmar
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Company Formation in Myanmar

Company Formation in Myanmar- An Overview

Myanmar is one of the largest south Asian countries. Myanmar is known as the official Republic of the Union of Myanmar. This is one of the large countries present in South East Asia. Myanmar is present between India, Bangladesh, Laos and China. It constitutes one of the largest countries in the mainland of South East Asia. Company incorporation in Myanmar is quite straightforward, as it takes less time to complete the process of registration.

Myanmar offers a large market with about more than 50 million inhabitants. Due to the diverse culture present in the country, youngsters are the main population in Myanmar. This country is considered as the fastest growing countries in South East Asia. The GDP is estimated to reach 7.5% by 2020. Hence from the above, it can be seen that Myanmar is one of the fastest growing countries in Asia.

Many international financial institutions have offered funds to Myanmar for progressive development. This will also include the USD 400 Million loan which was provided by the World Bank for doing business in the country. Major industries that are present in Myanmar include manufacturing and imports. Majority of exports include textiles, peanut oil, food and different types of plant products.

The Government of Myanmar has removed the red tape requirement for incorporation of companies. Hence companies can be easily established. All the incorporation procedures can be carried out through one process. Many Special Economic Zones (SEZs) have been established in Myanmar to carry out businesses.

Foreign companies can secure different forms of benefits by incorporating in these SEZ. Some of the benefits include tax holidays for a period of time, exemption from custom duties on manufacturing, machinery and other forms of equipment. There is no form of withholding tax charged on dividends offered by companies in Myanmar. Myanmar has entered into various forms of double taxation treaties with other countries which include India, Bangladesh, Indonesia, Malaysia and other south East Asian Countries.

There is abundant amount of natural resources present in Myanmar which includes gas, oil, precious metals like copper, gold and other forms of ores. Apart from this forestry and timber products are present. This country is known as one of the world’s oldest gas producers.

Benefits of Company Formation in Myanmar

The following are the benefits of company formation in Myanmar:

Benefits of Company Formation in Myanmar
  • Location

    Myanmar is a country with diverse culture. This is one of the large countries present in South East Asia. Myanmar is present between India, Bangladesh, Laos and China. It constitutes one of the largest countries in the mainland of South East Asia.

  • Double Taxation Agreements

    Myanmar has entered into various forms of double taxation treaties with other countries which include India, Bangladesh, Indonesia, Malaysia and other south East Asian Countries.

  • Natural Resources

    There is abundant amount of natural resources present in Myanmar which include gas, oil, precious metals like copper, gold and other forms of ores. Apart from this forestry and timber products are present. This country is known as one of the world’s oldest gas producers.

  • Special Economic Zones (SEZ)

    There are many SEZ present in Myanmar. Foreign companies can secure different forms of benefits by incorporating in these SEZ. Some of the benefits include tax holidays for a period of time, exemption from custom duties on manufacturing, machinery and other forms of equipment. Along with these zones, the government has removed the red tape requirement for company formation in Myanmar. Hence the procedure for incorporating a company in Myanmar is quite straightforward.

Eligible Business Structures for Company formation in Myanmar

The following are eligible business structures for company formation in Myanmar:

Eligible Business Structures for Company formation in Myanmar
  • Tax Resident LLC

    This form of entity is also known as a private limited company. The corporate tax rate charged for this type of entity is 25% on the profits which the company earns.

  • Nominee LLC

    The minimum paid up capital for forming this type of entity is USD 1 dollar.

  • Wholly Foreign Owned LLC

    To form this type of entity usually foreign shareholders would be appointed. The minimum shareholders required for company formation in Myanmar would be one. 100% foreign ownership is allowed for this form of entity. There is no form of minimum capital requirements to form this type of company.

  • Local LLC

    This is a domestically formed Limited liability company. The minimum shareholders required for company formation in Myanmar would be one. 35% foreign ownership is allowed for this form of entity. There is no form of minimum capital requirements to form this type of company.

  • Joint Venture

    Joint Venture form of entity is when a foreign company has an agreement with a domestic or local partner to carry out different forms of business activities. The minimum shareholders required for this form of entity is two. Minimum capital which is required for this entity is USD 50,000. Around 80% foreign ownership is allowed for this form of entity.

  • Joint Stock Company (PLC)

    This entity would be similar to an entity that lists shares in a public stock exchange. Minimum of seven shareholders are required to form this form of entity. Minimum capital required for forming this entity is USD 50,000.

  • Branch Office

    A branch office is a mere extension of a foreign parent company. Profit making activities can be carried out by the branch office. An investor seeking company formation in Myanmar can set up a branch office. Minimum of one shareholder is required to incorporate this form of entity.

  • Representative Office

    A representative office is a mere extension of the foreign parent company. The liabilities of the representative office would be the liabilities of the foreign parent company. Minimum of one shareholder is required to incorporate this form of entity.

Minimum Eligibility Criteria for Company Formation in Myanmar

The following eligibility criterion has to be sufficed for company formation in Myanmar:

Minimum Eligibility Criteria for Company Formation in Myanmar
  • Foreign Ownership

    An investor going for company formation in Myanmar has to suffice the required eligibility criteria. There are different sectors in Myanmar which allow 100% foreign investment. However, if a foreign investor wants to invest in a local LLC, then only up to 35% foreign investment would be allowed. There are few sectors where foreign investment is not allowed. These sectors include:

    • Manufacturing, Defence and Army

    • Nuclear Weapons

    • Tour Guide Business.

  • Registered Office in Myanmar

    Another requirement for company formation in Myanmar is to have a physically registered place of business with an address of correspondence. This is a mandatory requirement for company formation in Myanmar. Offices can be rented and leased out for some years. Foreign companies can lease the premises with permissions.

  • Minimum Capital

    The investor has to satisfy the minimum capital required for company formation in Myanmar. USD 50,000 is the minimum capital which is required for companies in the service sector. If you want to open a branch office or a representative office in Myanmar then you would require at least USD 50,000.

  • Minimum Shareholders

    The applicant also has to suffice the minimum number of shareholders for company formation in Myanmar. Usually, an LLC would only require one shareholder.

Procedure for Company Formation in Myanmar

The company registration is carried out with bodies such as the Directorate of Investment and Company Administration (DICA), a secretariat of the Myanmar Investment Commission (MIC). The provisions of the Myanmar Companies Law, 2017 would be applicable to all domestic and foreign companies formed in Myanmar.

The following procedure has to be adopted for company formation in Myanmar:

  • Name Reservation

    First and foremost, the applicant has to decide the form of business carried out in Myanmar. After this, the name of the business must be thought of. The name must be unique and represent the activities carried out by the company.

  • Business Incorporation Certificate

    After choosing the name, the applicant has to apply for a Business Incorporation Certificate. This would be carried out with the DICA. Along with this, specific documents have to be submitted. For the list of documents, see the below heading termed as ‘Documents required’.

  • Filing and Signing Application

    Once the documents are submitted, the authority would provide a temporary trade registration. You would have to file more forms to complete the process of registration.

  • Payment of Fees

    The applicant would have to pay the fees for company formation in Myanmar.

  • Opening Corporate Bank Account

    Once the company is incorporated, the applicant would have to open a corporate bank account and deposit money for carrying of activities and transactions.

  • Post requirements

    Capital must infused by the applicant into the company. With this the company operations would commence. The applicant would have to also apply for an official company seal.

Compliances for Company Formation in Myanmar

The following compliances have to be carried out for company formation in Myanmar:

  • Corporate Tax

    The corporate tax paid in Myanmar is 25%.

  • Annual General Meetings

    All companies in Myanmar would have to carry out annual general meetings at least once a year.

  • Other registrations

    Registering with the Myanmar Investment Commission and the DICA are the requirements which have to be carried out by companies.

Documents required

The following documents are required for company formation in Myanmar:

Documents for Provisional Registration

  • Companies Regulation 1957 Form A
  • Memorandum of Association
  • Articles of Association
  • Questionnaire Form which is to be filled
  • Business Activities carried out
  • First Year Estimated Expenditure
  • Financial Information of the Company
  • Resolution of Board of Directors
  • Foreigners Visa and Passport.

Documents for Permanent Registration

  • Registration Declaration
  • Copies of the MOA and AOA in Myanmar Language and English
  • Declaration related to the legal documents submitted for the company
  • Information and list of directors
  • Translation certificate from a competent individual
  • Registered Office Address Declaration
  • Representative Office and Branch Office (Manager or representative’s information).

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Frequently Asked Questions

If the company has lot of investment in Myanmar, some form of significant impact on the environment and foreign investment restrictions then it would take about 3 months to incorporate a company in Myanmar.

The following are the types of companies which can be incorporated in Myanmar:

  • Tax Resident LLC
  • Nominee LLC
  • Wholly Foreign Owned LLC
  • Local LLC
  • Joint Venture
  • Joint Stock Company (PLC)
  • Branch Office
  • Representative Office.

USD 50,000 is the minimum capital which is required for companies which are present in the service sector. If you want to open a branch office or a representative office in Myanmar then you would require at least USD 50,000.

Yes, a physical office with an official address of correspondence is required in the process of company incorporation in Myanmar.

The main authorities that deal with company formation in Myanmar are the Directorate of Investment and Company Administration (DICA), a secretariat of the Myanmar Investment Commission (MIC). The provisions of the Myanmar Companies Law, 2017 would be applicable to all domestic and foreign companies formed in Myanmar.

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