The Union Government has enacted the Industrial Zone Law 2020 ("IZL"), which came into effect on 26 May 2020. The IZL was enacted to regulate the industrial parks with respect to environmental conservation, and authorise the relevant government agencies to impose punishment on polluters and land speculators. The IZL allows the establishment of a Union-level central committee that would regulate the industrial zones on top of the existing regional and management committees. It also defines the responsibilities of the different levels of committees, and bans investors from occupying plots for speculation purposes.
Moreover, the IZL sets out the parameters for creating and implementing pollution control management and proper waste disposal. In particular, investors will now be made legally liable for "failing to make [their] own arrangements for waste disposal" if the zone does not have a collective waste disposal system in place.
The Ministry of Commerce ("MOC") has issued several notifications relating to the importation of goods and machines as well import duty free permits for medicines.
MOC Notification No.38/2020 and No.39/2020 Permitting the Importation of Liquor
MOC has issued Notification No. 38/2020 and No. 39/2020 dated 25 May 2020. Notification No. 38/2020 amended the list of goods that are prohibited from being imported into Myanmar. It has removed liquor from the list of prohibited goods, leaving only beers and cigarettes. Notification No. 39/2020 sets out the procedures and requirements which liquor importers must comply with in order to import liquors, including obtaining a Liquor Import Registration Certificate from MOC.
MOC Notification No.36/2020 Permitting the Import of Used Machinery
MOC has issued Notification No. 36/2020 dated 14 May 2020 ("Notification") which allows businesses to import used machines that are not older than 10 years. In order to reduce the environmental impact of importing used machines, and regulate business productivity, the importation of these machines will only be permitted if the requirements stipulated in the Notification are complied with.
MOC Notification No. 27/2020 on Duty Free Import on Medicines and Raw Materials
MOC has issued Notification No. 27/2020 dated 11 April 2020 announcing the issuance of import duty free permits with respect to all medicines and raw materials used for manufacturing medicines in light of the recent COVID-19 outbreak.
MSEC Notification No. 1/2020 – Stipulations for the Offering of Securities not Required to Submit Prospectus
ln the exercise of the power conferred by section 36 and section 71(b) of the Securities Exchange Law, the Securities and Exchange Commission of Myanmar ("SECM") issued Notification No.1/2020 dated 15 May 2020 on Stipulations for the Offering of Securities not Required to Submit Prospectus ("Notification"). The Notification sets out the requirements in relation to the offering of securities by public companies, stating that prospectuses shall not be submitted in accordance with the Securities Exchange Rule 107.
Based on the Notification, the issuer shall notify the Commission of the names of the Other Institutions within 10 business days after the issuance of securities. ln relation to Article (c) of Rule 107 of the Securities Exchange Rule 107, it is provided that the amount of offer of securities of the same kind within a period of six months must not exceed 500 million kyats.
In so far as the issuance of securities (except corporate bonds or debentures without rights to convert to shares, rights to acquire shares or similar products) is concerned, information related to such transactions must be provided to existing shareholders at least 35 days before the offering of such securities. SECM must be so notified in accordance with the stipulated format.
For the issuance of corporate bonds or debentures, the issuer must comply with the requirements set out by the SECM Commission. It must notify SECM of the issuance of corporate bonds and debentures within 10 business days after such issuance.
The Union Government has enacted the Myanmar Insolvency Law 2020 ("MIL") which came into operation on 25 March 2020, repealing the century-old Yangon Insolvency Act 1909 and the Myanmar Insolvency Act 1920. The pieces of legislation governing the winding up of companies in Myanmar used to be the Myanmar Companies Law 2017, the Yangon Insolvency Act 1909, and the Myanmar Insolvency Act 1920.
Unlike the previous pieces of legislation, the MIL is a comprehensive and complete legislation providing for personal, corporate and cross-border insolvency rules. It adopts the United Nations Commission on International Trade Law ("UNCITRAL") Model Law on cross-border insolvency, providing a modern insolvency regime and a model framework for solving financially distressed companies that have creditors or assets in more than one state.
It also provides for a separate insolvency regime for the micro, small and medium-scale enterprise ("MSME") sector. It is intended to focus on MSME by streamlining the rehabilitation and liquidation process for a simpler and more cost-effective system.
In terms of Personal Insolvency, the MIL encourages debtors to reach a voluntary agreement with their creditors, if possible. The voluntary arrangement is legally binding and will write off part of the debt or allow for payment of the debt over a fixed period of time.
Following the enactment of the MIL, the Union Supreme Court issued Notification No. 321/2020, otherwise known as the Myanmar Insolvency Rules 2020 ("MIR") on 28 April 2020 to supplement the MIL.
The Union Government formed the Myanmar Insolvency Practitioners’ Regulatory Council pursuant to Notification 25/2020 on 26 March 2020.
CBM Directive No.8/2020 – Reduction of Interest Rates on Deposit and Lending
The Central Bank of Myanmar ("CBM") has issued Directive No. 8/2020 dated 27 April 2020 modifying the CBM-approved interest rate from 8.5% per annum to 7% per annum.
