Foreign Employee Restrictions Issued by the Central Bank of Myanmar

The Central Bank of Myanmar ("CBM") issued Letter No. CBM/MP/FIR/Bank Si Sit/1 (4/2021) titled "Instructions to comply for matters related with employing of foreign employees at Banks" ("Instructions") which took effect from 2 August 2021. The relevant details are as follows:

1. Banks intending to employ foreigners must seek the approval of CBM at least 30 days before engaging such employees. Applicant banks must provide documentation proving that they have scrutinised the prospective employees in relation to their political involvement, criminal records, and insolvency, and they are satisfied that such prospective employees do not have political involvement, no criminal records and are not insolvent;


2. The Letter also sets out the maximum number of foreign employees that can be employed by a bank depending on its size:



Type	Market Share	Maximum number of Foreign Employees
Large Bank	More than 5%	25
Medium Bank	Between 1-5%	15
Small Bank	Less than  1%	8



3. Banks which are currently employing more than the maximum number of foreign employees must, within 30 days from the issuance of the Instructions, submit proposed measures to make them compliant with the prescribed maximum cap;


4. Foreign banks are not allowed to employ a foreigner as their Chairman or Deputy Chairman. Where a Chief Executive Officer is a foreigner, the Deputy Chief Executive Officer must be a Myanmar citizen;


5. Banks with foreigners on their Boards of Directors are required to obtain approval from CBM for these foreigners' continued participation;


6. Foreigners may be Heads of Departments so long as they do not comprise more than 50% of the Heads of Departments. Furthermore, where a foreigner is a Head of a Department, the Deputy Head of the Department must be a Myanmar citizen.



• Foreigners employed to be Heads of Departments must serve a probation term of one year, and be duly employed for three years thereafter. This may be extended for an additional period of two more years, after seeking approval with the CBM.



7. Banks are obligated to have in place a professional training plan for Myanmar citizens with the view that the Myanmar citizens will be able to undertake the roles of the foreign employees;


8. Banks are obligated to report to CBM their foreign employees' travel history outside of Myanmar. The duration of travel that a foreign employee may have should not exceed three months, in lieu of special permission from CBM;


9. Non-compliance with the aforementioned instructions may result in a breach of Section 154 of the Financial Institutions Law. A breach of Section 154 of the Financial Institutions Law may result in (i) a warning, (ii) payment of fines, (iii) issuance of orders including those restricting the operations of financial institutions, or (iv) temporary suspension or termination from duties in financial institutions.