Must Know Rules and Regulations for Investment in Myanmar Dr. Marlar Myo Nyunt Director Directorate of Investment and Company Administration Ministry of Planning and Finance

Large youthful population Strategic geographic location Myanmar as an investment destination Large youthful population Resource Rich Sizeable Market Strategic geographic location

What DICA is? The Directorate of Investment and Company Administration (DICA) serves as the Secretariat of MIC. The responsible for investment and company administration and to implement the duties and responsibilities of Myanmar Investment Commission. The First Point of Contact for Investors

New Myanmar Investment Commission (MIC) 1. H.E U Kyaw Win Union Minister Ministry of Planning and Finance Chairman 2. H.E. Dr. Than Myint Ministry of Commerce Vice Chairman 3. H.E. U Tun Tun Oo Attorney General Attorney General’s Office Member 4. U Khin Maung Yee Permanent Secretary Ministry of Natural Resources and Environment Conservation 5. U Toe Aung Myint 6. U Tun Tun Naing

New Myanmar Investment Commission (MIC) (Cont.) 7. U Htay Chun Deputy Director General (Retired) Directorate of Investment and Company Administration Member 8. U Kyaw Director (Retired) General Administration Department 9. U Aye Lwin Joint Secretary General Republic of the Union of Myanmar Federation of Chambers of Commerce and Industry 10. U Aung Naing Oo Director General Secretary 11. Daw Mya Thuza Deputy Director General (Retired)   Joint Secretary

DICA’s Functions for Investment Scrutinizing investment proposals Organizing investment promotion activities Facilitating investment / business Coordinating with Ministries / Region and State Governments Facilitate Business, Promote Investment and Sustain the Country’s Development

Principles of MIC Not to violate the interest of the State and people Not to have any impact on national dignity Not to breach of sovereignty Not to affect on environment

Doing Business in Myanmar

Foreign Investment Law Myanmar Special Economic Zone Law Mode of Doing Business Business Foreign Investment Law Myanmar Companies Act Myanmar Special Economic Zone Law MIC Company Incorporation SEZ MC Permit Registration/ Permit Permit Start Start Start Enjoy Incentives No Incentives Enjoy Incentives

Legal Framework for Investment Laws Foreign Investment Law (2nd Nov 2012) Foreign Investment Rules (31st Jan 2013) Myanmar Special Economic Zone Law (23rd Jan 2014) Myanmar Special Economic Zone Rules(27th Aug 2015)

Notification No. 51/2014 Investment Business Activities that are not required to grant exemption and relief from tax Notification No. 26/2016 List of Economic Activities under Prohibition List of Economic Activities to be allowed only in the form of Joint Venture with Myanmar Citizens List of Economic Activities Permitted with the Specific Condition List of Economic Activities Permitted with the recommendations of the Relevant Ministry and Required Joint Venture with the Citizen List of Economic Activities Permitted with Other Conditions and required Joint Venture

Form of Investment 100 % foreign capital Joint Venture between a foreigner and a citizen Any system contained in the contract which approved by both parties

Exemption and Reliefs 5 years tax holiday Further tax exemption/relief for an appropriate period in case if it is considered beneficial for the State

Exemption and Reliefs Exemption or relief of income tax on reinvestment; Right to accelerate depreciation of capital assets for the purpose of income-tax assessment; Relief from income tax up to 50 percent on the profit from exports; Same rate of income tax between foreigners and Myanmar citizens; Right to deduct the research and development expenditure from taxable income; Right to carry forward and set off losses up to 3 consecutive years.

Exemption and Reliefs Exemption/Relief of Customs Duties and/or Other Internal Taxes Imported machinery & equipment - construction period Imported raw material - first 3 years of commercial production Exemption/Relief of Commercial Tax Exports

Rights to Use Land Initial 50 years 10 years two times depending upon the category of the business, industry and the volume of investment 10 years two times

Salience of New Investment Law (Draft)

Incentives under New Investment Law(Draft) Incentive is not granted automatically Investors may apply one or more than one the exemptions and reliefs Exemption & Reliefs Income Tax Exemption & Relief Exemption from Customs Duty & Other Internal Taxes Other Exemption & Relief

Incentives under New Investment Law(Draft) Zone(1) Less Developed Regions and States Income Tax Seven Years Zone(2) Fairly Developed Regions and States Income Tax Five Years Zone(3) Developed Regions and States Income Tax Three Years

FDI in Myanmar

Inflow of FDI US $ in Million

FDI Situation in Myanmar Foreign Investment of Permitted Enterprises As of (31-8-2016) (By Sector) (US$ in Million) Oil and Gas 22410.368 Power 19684.642 Manufacturing 6922.135 Transport & Communication 5197.534 Real Estate 3111.451 Mining 2897.606 Hotel and Tourism 2481.395 Livestock & Fisheries 536.630 Agriculture 249.866 Industrial Estate 203.113 Construction 37.767 Other Services 687.804

FDI Situation in Myanmar Foreign Investment of Permitted Enterprises as of (31/8//2016) (Countries)

Thailand Investment in Myanmar (As of 31 August, 2016) (US$ in Million)

Cooperator of Business Community, Developer of National Economy Thank You Cooperator of Business Community, Developer of National Economy DICA Let’s first present you with criterion for foreign investment. www.dica.gov.mm