The new Myanmar Companies Act which entrepreneurs at home and abroad have been waiting for a long time has already been promulgated on 6th December 2017. Just prior to its promulgation, the former Burma Companies Act which was enacted in 1940, has now reached 77 years. Being promulgated under colonial rule, undoubtedly it needs amending.
One characteristic of the presently promulgated Myanmar Companies Act is letting foreign investors invest up to 35 percent in local companies. In other words, it means that the said local company is acknowledged as Myanmar citizen-owned one though foreign investment includes 35 percent whereas in the abolished old act it was acknowledged as a foreigner-owned company if a foreigner owns just one percent of the shares in the company. Here, someone may ask a question as to what benefits we will have over the acknowledgement as Myanmar citizen-owned company, though the equity held by the foreign partner is 35 percent.
The first-ever result we will acquire is that the local companies will accept foreign direct investments willingly. According to the conclusions of international and local experts, the major requirement of local companies is none other than foreign investment. Now, the local companies will be able to enjoy certain benefits such an access to favorable conditions which will fulfill these requirements. As for the foreign investors, they will bring with their investments technical knowhow greatly needed by local companies, for acquisition of much profit for them. In addition, foreign investors will wholeheartedly cooperate with local companies to get markets for the produced outputs.
Being the long-awaited setting/scene of Myanmar companies, it is the setting which the newly-promulgated Myanmar Companies Act, 2017 will bring about. Another characteristic of the New Act is that foreign investors have the right to possess 35 percent shares and simultaneously they will have rights to sell their shares at the Yangon Stock Exchange. It is the first and rare chance given by the Myanmar Companies Act, 2017 and it will strengthen Myanmar’s sole Yangon Stock Exchange. Here, we would like to express our heartfelt welcome towards the Myanmar Companies Act, 2017 of great virtues.