Myanmar drafts new companies act

Myanmar is drafting a new companies act in a bid to replace the century-old one and the new draft law will be submitted to the next parliament session for approval, official media reported Wednesday.

In conjunction with the Asian Development Bank, the new law is being developed by the Directorate of Investment and Company Administration (DICA) and business people and the public are being invited to provide input on modernization of the new legislation.

"The Myanmar Company Act 1914 requires major changes," Chris Hughes, managing partner of multinational law firm Baker and MeKenzie, told a consultation meeting, adding that its reform is as important as the modernization of the investment law.

The key part of the draft law includes forms of companies, incorporation process and corporate governance.

"Modernizing the old company act will be beneficial to businesses in Myanmar, making it easier for them to operate and to access finance," said Winfried Wicklein, resident ADB country director.

Meanwhile, Myanmar is drafting a new investment law in which two existing laws governing domestic and foreign investment will be superseded.

The draft Myanmar Investment Law-2015 is being developed in cooperation with the International Finance Corporation (IFC), aimed at modernizing Myanmar's rules and regulations on investment, according to the DICA.

Official compiled statistics show that contracted foreign investment in Myanmar reached 54.086 billion U.S. dollars with 886 foreign enterprises making the investment in the country as of the end of February 2015 since 1988.

Myanmar promulgated a new foreign investment law in November 2012, replacing the over-two-decade-old 1988 similar law and reformed its investment commission in June 2014 as part of its efforts to draw more foreign investment into the country in line with its reform strategy. Endi