Friday, August 17, 2012

Myanmar's Lower House OKs new foreign investment bill

Myanmar's Lower House has approved the new Foreign Direct Investment Bill with 94 amendments made to the draft law.

The proposed bill limits foreign investment in certain businesses to between 35 and 49 per cent, and also makes provisions on land allocation for the farming sector, and ensuring foreign investments will not hurt small and medium-scale industries in the country.

Speaker Thura U Shwe Mann of Lower House said on Tuesday, “The Foreign Direct Investment Bill has been scrutinised by both the Upper House and the Lower House.”

Amendments in the bill include a requirement that initial investment by a foreigner must be at least US$5 million or other foreign currencies equivalent to this amount that are accepted by the Central Bank of Myanmar.

Some limited joint-venture businesses will be allowed 49 per cent foreign investment of the total capital.

If foreign companies plan to sell all or some of their shares to another foreigner or a Myanmar citizen, they will need approval from the foreign investment commission for registration of share transfer in line with the existing law.

Foreign investors must also share high technologies to partner business firms or organisations in accordance with the agreements.

Regarding technical sectors, skilled citizens and employees must comprise at least 25 per cent of the workforce in the first two years of investment, 50 per cent in the next two years and 75 per cent in the fifth and sixth years.

Foreign investors can transfer money overseas in accordance with the market exchange rate through local banks that are authorised for foreign banking services.

The Lower House will submit the FDI bill to the Upper House after which the president will give his approval.

Further amendments to the draft law can be made only at the Union Assembly.-Asia News Network (August 16, 2012)

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