MYANMAR CORPORATE
SECRETARIAL BOOKLET
2023
Get to the point.
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Published by VDB Loi Co., Ltd April 2023
Version 1.0
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Contents
A. OVERVIEW................................................................................................ 1
Forms of establishment ..................................................................................1
Other useful definitions................................................................................... 1
B. PRIVATE COMPANY LIMITED BY SHARES.................................................... 3
Essential provisions......................................................................................... 3
Shareholders’ decisions and meetings............................................................4
Directors ......................................................................................................... 4
Compliance ..................................................................................................... 6
Overview of approval authority (shareholders versus directors)
for a private company limited by shares.........................................................8
C. OVERSEAS CORPORATION........................................................................ 10
Overseas corporation ...................................................................................10
Requirements for registration.......................................................................10
Compliance.................................................................................................... 10
Ceasing to carry on business in Myanmar.....................................................11
D. COMPANY LIMITED BY GUARANTEE......................................................... 12
Essential provisions....................................................................................... 12
Compliance.................................................................................................... 12
E. BUSINESS ASSOCIATION........................................................................... 14
Form of registration...................................................................................... 14
Business association categories....................................................................14
Essential provisions....................................................................................... 14
Compliance.................................................................................................... 15
F. WINDING UP A COMPANY IN MYANMAR................................................. 16
Who can be a liquidator?..............................................................................16
What does the liquidator do?........................................................................17
Claims and priority of claims.........................................................................17
Filing of winding up with the DICA................................................................17
A. OVERVIEW
The Myanmar Company Law 2017 (“MCL”) was passed in late 2017 to replace
the old Myanmar Company Act 1914 (“MCA”) and add certain reforms to the
regulation of companies in Myanmar. The MCL went into effect on 1 August
2018.
Following effectiveness, an electronic company registry system called MyCo
was introduced. It allows the registration of entities and the filing of corporate
changes with the Registrar (i.e. the Directorate of Investment and Company
Administration (“DICA”)) online instead of in person.
Forms of establishment
Below are the types of corporations that can be registered in Myanmar in
accordance with the MCL:
• Company limited by shares (either a private or a public company)
• Company limited by guarantee
• Unlimited company
• Business association (“BA”)
• Overseas corporation
• Other types of corporations that are entitled to be registered under other
applicable laws in Myanmar
Other useful definitions
Foreign company
Under the MCA, a Myanmar company was defined as one that is 100% owned
and controlled by Myanmar citizens. The MCL changed this definition to allow
foreigners to hold up to 35% in a Myanmar company (i.e. Myanmar citizens
must hold 65% or more). In short, a company in which a foreigner has a direct
or indirect ownership of up to 35% is still considered a Myanmar company
under the MCL. A company is considered a foreign company if the direct or
indirect foreign ownership is more than 35%.
Small company
A small company is a company that is not a public company or a subsidiary of
a public company and meets the following two conditions:
(i) It and its subsidiaries have no more than 30 employees; and
(ii) It and its subsidiaries had annual revenue in the prior financial year of
less than MMK50 million (approximately US$23,800) in total.
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Small companies are entitled to two exemptions from the normal annual
compliance requirements:
(i) Exemption from holding an annual general meeting (“AGM”) every year.
A small company can simply pass a written shareholders’ resolution in
lieu of calling and holding the meeting.
(ii) Exemption from having to have their financial statements audited
annually.
Ordinarily resident
MCL defines a person as ordinarily resident if they have resided in Myanmar
for at least 183 days of the past 12 consecutive months.
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B. PRIVATE COMPANY LIMITED BY SHARES
Essential provisions
There are certain requirements for a private company limited by shares under
the MCL. We highlight below the key provisions.
Minimum capital
There are no minimum capital requirements under ethe MCL. A company can
be registered with only one share issued. There are also no authorized capital
requirements.
Shares
Companies can issue different classes of shares with different rights and
benefits. Below are the types of shares that can be issued:
• Ordinary shares
• Redeemable shares
• Preference shares
• Other classes of shares as defined in the company’s constitution
The MCL does not specify any requirements regarding a share’s par value.
Directors
The MCL requires that companies have at least one ordinarily resident director.
A minimum of one director is required and there is nothing specified on the
maximum number of directors. Directors must be natural persons. There is no
concept of a corporate director under the MCL.
Shareholders
The MCL requires a minimum of one shareholder and a maximum of 50
shareholders. Shareholders can be individuals or entities.
Constitutional documents
Companies can adopt the model constitution issued by the DICA or they can
customize certain provisions of the model constitution as allowed under the
MCL and register such customized constitution with the DICA.
Corporate secretary
This is not compulsory, but is allowed. The corporate secretary must be a
natural person.
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Registered office address
Companies must have a registered office address in Myanmar. All notices and
communication will be addressed to the registered office address. Companies
do not need to carry on their business at the registered office address.
Business objectives
Companies are not required to declare their business objectives in the
constitution or during the registration process. However, they are required
to declare their main business objectives when they file their annual return
(“AR”) (see further details under the compliance section below).
Shareholders’ decisions and meetings
Shareholders’ meetings
There are three types of shareholders’ meetings under the MCL:
• AGM: This is held each year to review and approve the normal annual
business of the company, such as annual reports and business plans.
• Special general meeting: This is any other meeting of the shareholders
except the AGM.
• Statutory meeting (“SM”): This is applicable only to a public company and
a company limited by guarantee with share capital (see further details in
Section D).
Shareholders’ decisions
Decision of shareholders can be done through either an ordinary resolution
or a special resolution, depending on the provisions of the MCL and the
company’s constitution.
• Ordinary resolution: This is a resolution that requires the affirmative votes
of a simple majority to pass (i.e. requires more than 50% of the votes).
• Special resolution: This is a resolution that requires the affirmative votes of
at least 75% of the votes to pass.
Directors
Duties of directors
Directors are those appointed by the shareholders of the company to manage
the company’s day-to-day business. The main responsibilities of the directors
are to:
• Determine and implement the company’s policies.
• Prepare and file all required notices with the DICA and other governmental
authorities.
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• Determine the dividend to be distributed to the shareholders.
• Maintaining and keeping records as required by the MCL.
• Call for shareholders’ meetings.
Directors also have the following legal duties under the MCL:
No. Duty Explanation
1 Duty to act with care and Act in good faith and do not have a
diligence material personal interest in making
the decision.
2 Duty to act in good faith in Act in the best interests of the
the company’s best interests company for a proper purpose.
3 Duty regarding use of Do not use their position to gain a
position personal advantage or to harm the
company.
4 Duty regarding use of Do not use information obtained
information as a director to gain a personal
advantage or to harm the company.
5 Duty to comply with the law Understand the obligations of
and constitution directors under the MCL and
constitution and comply with them
in making decisions.
6 Duty to avoid reckless trading Do not allow any activities that could
create substantial risk of serious loss
to the company’s creditors.
7 Duty in relation to obligations Do not allow the creation of any
obligation for the company unless
it can be assured that the company
will be able to perform such
obligation if required.
8 Duty to disclose certain Disclose any material personal
interests interest that might lead to a conflict
of interest.
A director that breaches any of the above duties will be subject to a fine of
MMK10 million (approximately US$4,760) or any additional amount that the
court may determine in accordance with the MCL.
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Directors’ approval
Directors can call for a directors’ meeting to discuss and approve a resolution.
A simple majority of the votes of the directors present is required to pass a
resolution. Otherwise, a resolution can be passed by written resolution. In the
case of a written resolution, the approval of all directors is required.
Compliance
Annual compliance
(i). Annual return
The AR is a prescribed form issued by the DICA in accordance with the
MCL. The AR consists of 12 questions to confirm that the company
details maintained by the DICA as shown in MyCo are complete and up
to date.
All companies are required to file an AR through MyCo within two
months from its incorporation and then every year, not later than one
month from the anniversary of its incorporation.
Failure to file an AR on time will lead to the suspension of the company’s
registration. If the suspension is not rectified within six months from the
date of suspension, the company will be struck from the DICA’s registry.
(ii). Audit of financial statements
All companies except for small companies must appoint an external
auditor to audit their financial statements annually for presentation at
the AGM. However, private companies limited by shares are not required
to file their audited financial statements with the DICA.
(iii). Annual general meeting
All companies except for small companies are required to hold their
first AGM within 18 months from the incorporation date and then once
every calendar year and not later than 15 months from the previous
AGM.
An AGM is held to consider and approve the following matters:
• Annual financial report and directors’ report
• Audited financial statements issued by the auditor
• Appointment of the auditor (if any)
• Election of directors (if any)
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(iv). Maintenance of corporate records and registers
All companies are required to maintain the corporate records and
registers specified under the MCL. The registers should be kept at the
registered office address or the principal place of business or at the
office of the person appointed to maintain the company’s registers. A
company’s records and registers must include:
• Register of members
• Register of directors and corporate secretary (if any)
• Minutes of meetings and resolutions
• Register of mortgages and charges
• Company’s constitutional documents
Failure to comply with this requirement will lead to a penalty
ranging from MMK150,000 (approximately US$71) to MMK10 million
(approximately US$4,760), depending on the specific non-compliance.
Corporate changes
Companies are required to file a notice with the DICA for any changes in
corporate details. We have summarized the main filings in the table below:
No. Description Timing
1 Change of director Within 28 days of the change
2 Change of shareholder Within 21 days of the change
3 Change in share capital Within 21 days of the change
4 Change of company name Within 28 days of the approval of
the change
5 Change in the company’s Within 28 days of the approval of
constitution the change
6 Change of the registered office Prior to the effective date of the
address change
7 Notice of change of location Within 21 days
where company registers and
records are kept
8 Registration of mortgage or Within 28 days
charge
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No. Description Timing
9 Modification of a particular Within 28 days
mortgage or charge
10 Satisfaction of a mortgage or Within 28 days
charge
11 Filing in relation to a related 14 days and 28 days
party transaction
Late filing fees
Late filing fees are imposed on late filings, and are calculated based on how
late the filing is done.
No. Days late Late fee (MMK)
1 1 to 90 days 25,000
2 91 to 180 days 50,000
3 Over 180 days 100,000
Overview of approval authority (shareholders versus directors)
for a private company limited by shares
Matters requiring approval from Matters requiring approval from the
the shareholders board of directors
Appointment/resignation/removal Transfer of shares
of directors
Appointment of auditor Appointment of managing director
Financial statements Dividend declaration
Change of the company’s name Related party transaction
Change in the company’s Issuance of shares (except preference
constitution shares)
Share buyback or share reduction Other matters that do not require
approval from the shareholders
Issuance of preference shares
Change of company type
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Matters requiring approval from Matters requiring approval from the
the shareholders board of directors
Remuneration paid to directors
Related party transaction (this is
applicable only if approval from the
board of directors is not obtained)
Voluntary winding up
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C. OVERSEAS CORPORATION
Overseas corporation
Pursuant to Section 43 of the MCL, an overseas corporation will not be
deemed to be carrying on business in Myanmar in the following cases:
• Acting as a party to legal proceedings or the settlement of legal proceedings
or a claim or a dispute.
• Holding meetings of its directors or shareholders or carrying on other
activities concerning the management of its internal affairs.
• Maintaining a bank account.
• Effecting a sale of property through an independent contractor.
• Soliciting or procuring an order that becomes a binding contract only if the
order is accepted in Myanmar.
• Lending money, creating evidence of a debt, or creating a charge on the
property.
• Securing or collecting any of its debts or enforcing its rights in relation to
securities relating to those debts.
• Conducting an isolated transaction that is completed within a period of
30 days.
• Investing its funds or holding property.
Requirements for registration
An overseas corporation must not carry on business in Myanmar unless
it is registered. It must appoint a person to act as its authorized officer for
the office in Myanmar. The authorized officer must be ordinarily resident in
Myanmar.
Compliance
Annual filings
All overseas corporations are required to file the following with the DICA
annually:
(i) Annual return: within 28 days from the end of its financial year.
(ii) Financial statements, which must include a balance sheet, cash flow
statement, and profit and loss statement.
All directors and the authorized officer of the overseas corporation will be
liable for a fine of MMK250,000 (approximately US$119) for any failure to
comply with such filing requirements.
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Corporate changes
All overseas corporations are required to file a notice with the DICA for any
changes in corporate details, including:
(i) Change in directors and directors’ details
(ii) Change of the registered office address or principal place of business
overseas
(iii) Change of the registered office address or principal place of business of
the overseas corporation in Myanmar
(iv) Change in the authorized officer and the authorized officer’s details
All directors and the authorized officer will be liable for a fine of MMK250,000
(approximately US$119) for any failure to comply with such filing requirements.
Ceasing to carry on business in Myanmar
When an overseas corporation ceases carrying on business in Myanmar it
must file an application requesting deregistration with the DICA within 21
days of the cessation of business. The application will be approved by the
DICA within 60 days from the filing date. Upon approval by the DICA, the
status on MyCo will be changed to deregistered. the DICA will then remove
the name of the overseas corporation after a certain period of time.
The overseas corporation must also clear all of its liabilities with other
governmental authorities, such as with the Internal Revenue Department,
before it is considered fully deregistered.
If the overseas corporation is also liquidating or is dissolved in its place of
origin, it must conduct the same full winding-up process, including the
appointment of a liquidator, as for a company (see Section F below).
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D. COMPANY LIMITED BY GUARANTEE
Essential provisions
Share capital
A company limited by guarantee does not need to have share capital.
Members
A company limited by guarantee can have any number of members. The
liability of the members is limited by the amount of the guarantee.
Directors
There must be at least one ordinarily resident director. There is no regulation
regarding the maximum number of directors.
Constitutional documents
A company limited by guarantee is required to have its constitution registered
with the DICA. It must be prepared in the Myanmar language.
If the company will not have share capital, the constitution should state the
guarantee amount and the undertaking of members to contribute to the
assets of the company in the event of winding up.
If it will have share capital, the constitution should state the class of shares
that the company is going to issue and the currency denomination of such
shares.
Dividend declaration
A company limited by guarantee does not declare dividends.
Compliance
Companies limited by guarantee also have certain annual compliance and
filing requirements under the MCL.
Annual return
Like a company limited by shares, a company limited by guarantee is required
to file ARs. The first AR is due within two months from incorporation and then
every year, not later than one month from the anniversary of its incorporation.
Audit of financial statements
Like for companies limited by shares, companies limited by guarantee are also
required to appoint an external auditor to audit their financial statements
every financial year.
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Statutory meeting
A company limited by guarantee that has share capital must hold a general
meeting of its members (called an SM) within the period of not less than 28
days or more than six months from its incorporation date.
A company limited by guarantee that does not have share capital is required
to hold an AGM each year like a company limited by shares.
Requirements of an SM
There are certain matters that companies must comply with when organizing
an SM:
• Directors must circulate the statutory report to the members at least 21
days before the date the SM will be held.
• If the company has more than one director, the statutory report must
be certified either by at least two directors, or by the chairperson of the
directors, who is authorized to do so by the board of directors.
• The statutory report, as far as it related to the shares allotted by the
company, the cash received in respect of such shares, and all other amounts
received and paid out by the company is certified as correct by the auditor
of the company.
• A copy of the certified statutory report must be registered with the DICA
after it is sent to the members.
All directors will be liable for a fine of MMK250,000 (approximately US$119)
for any violation of the above requirements.
Corporate changes
The same as for other corporate forms, a company limited by guarantee is
required to file a notice with the DICA for any change in its corporate details
such as directors, members, or registered office address.
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E. BUSINESS ASSOCIATION
Under the MCL, BAs are established mainly for the purpose of promoting
commerce and developing projects. BAs should not be established for profit-
earning purposes.
Form of registration
A BA established under the MCL will be registered as a company limited by
guarantee.
Business association categories
There are four levels of BAs; they are classified based on the number of
directors and their nationality:
(i) A BA is classified as a union-level BA if:
(i). The majority of directors are foreigners; or
(ii). At least seven directors are Myanmar citizens from seven different
states/regions of Myanmar
(ii) A BA is classified as a state- or regional-level BA if the majority of its
directors are residents of the relevant state or region.
(iii) A BA is classified as a district-level BA if the majority of its directors are
residents of the relevant district.
(iv) A BA is classified as a township-level BA if the majority of its directors are
residents of the relevant township.
Essential provisions
Minimum capital
There is no minimum capital required for a BA.
Members
BAs must have at least one member and there is no restriction on the
maximum number of members. Members can be foreigners or Myanmar
citizens.
Directors
The minimum requirement is one director and there is no regulation
regarding the maximum number of directors. BAs must have at least one
ordinarily resident director.
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Guarantee amount
There is no requirement regarding the minimum or maximum guarantee
amount for each member. However, the guarantee amount that each member
is willing to provide should the BA be wound up should be clearly stipulated
in the BA’s constitutional documents.
Business objectives
BAs are required to stipulate their business objectives in their constitution.
Constitutional documents
A BA must have its own constitution that is registered with the DICA. There
is not a separate model constitution for BAs. The BA can use the model
constitution for a private company limited by shares and make certain
required amendment accordingly.
Corporate Secretary
A BA may appoint a corporate secretary; however, it is not compulsory.
Compliance
Like companies, BAs have certain compliance requirements.
Annual return
A BA is required to file an AR within two months from the date of incorporation
and then every year, not later than one month from the anniversary of its
incorporation.
Audit of financial statements
BAs are not considered small companies under the MCL. Therefore, they are
required to have their financial statements audited every financial year.
Annual general meeting
A BA is required to hold its first AGM within 18 months from the date of
incorporation and then every year, but not later than 15 months from the
previous AGM.
Corporate changes
Like companies, BAs are required to file a notice with the DICA in the event of
any changes in their corporate details.
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F. WINDING UP A COMPANY IN MYANMAR
A company can close down by conducting the winding-up process. The
winding-up process will be done in accordance with the Myanmar Insolvency
Law (“IL”), which supersedes the section on winding up in the MCL. There are
two main types of winding up:
• Voluntary winding up: This can be either by the members’ voluntary
winding up or the creditors’ voluntary winding up.
• Compulsory winding up: This is normally by court order.
Type of winding Appointment of
No. Situation
up liquidator
1 Member voluntary • Company is solvent. Company appoints
winding up the liquidator.
2 Creditor voluntary • Company is insolvent; Creditors appoint
winding up or the liquidator. If
• Company is transiting they do not appoint
out of rehabilitation. one, the company
will do so.
3 Winding up by the • Company is insolvent Liquidator to be
court and is done through nominated by
a special resolution of the applicant or
the company; or appointed by the
• Company is insolvent court.
and the court is
satisfied that it is in
the public interest or
it is just and equitable
that the company be
wound up.
Who can be a liquidator?
Only an insolvency practitioner (“IP”) registered in accordance with the IL can
be appointed as a liquidator.
IPs must be registered and obtain a member registration certificate from the
Myanmar Association of Insolvency Practitioners.
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What does the liquidator do?
• Carries on business, pays debts, negotiates payment settlements, disposes
of properties, disclaims properties, and makes distributions
• Reports to the DICA if the winding up of the company will not be concluded
within one year after its commencement
• Holds a final meeting of the members before dissolution
• Finalizes the dissolution with the DICA
Claims and priority of claims
The IL provides the order and priority for a company to settle its debts and
claims. Taxes payable to the government is no longer the first priority in the
list. Under the IL, claims must be paid in the following order when winding
up a company:
• The IP’s fees and expenses
• Wages, salaries, and remuneration paid to relevant employees in respect of
work performed before the commencement of the winding up
• Amounts to be paid to relevant employees in relation to leave for the
period before the commencement of the winding up
• Severance entitlement to relevant employees
• Compensation for any injured employees
• Payments to secured creditors
• Other debts
Filing of winding up with the DICA
As part of the winding-up process (i.e. voluntary winding up), the company is
required to file with the DICA in the prescribed form on MyCo the following:
• Notice of appointment of liquidator: This form must have attached: (i) the
IP’s consent to the appointment together with their IP certificate and; (ii)
the directors’ declaration of solvency (for member voluntary winding up).
The filing must be done within two business days from the appointment
of the IP.
• Liquidator’s final reporting: This filing must be done within a week after the
date of the final meeting of the members before dissolution. The form must
have attached: (i) the liquidator’s report on the company’s accounts; (ii) the
final tax clearance obtained from the tax authorities; and (iii) a copy of the
meeting minutes of the final meeting.
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