Myanmar Legal Developments
1 March 2013
In our client alert dated 5 April 2012, we reported on legal and political developments in Myanmar in light of the national by-elections that won Daw Aung San Su Kyi a seat at the National Assembly on 1 April. Since that client alert, Myanmar has continued on a path of increasing openness to foreign investment as well as engagement with the global community, as witnessed by President Barack Obama's state visit in October 2012. Further progress has been made with the enactment of a new Law on Foreign Investment ("NLFI") in November 2012 and the issuance of implementation regulations under the NLFI ("Foreign Investment Rules") on 31 January 2013. This client alert summarizes these two developments.
As a cautionary note, our clients are advised to balance the country's legal and political progress against the consequences of on-going civil unrest in western Myanmar and Kachin State. Further, the state of Myanmar's infrastructure poses severe challenges for those wishing to establish operations in accordance with the customary expectations of global business in Asia. While the commercial press has enthusiastically reported on Myanmar's progress, investor expectations should be balanced, realistic and uninfluenced by media hype. Certainly, Myanmar presents a similar opportunity as China did at the time of the enactment of its Sino-foreign joint venture law in 1979. Graying professionals with memories of that era will recall that it took many years before China reached the take-off stage for foreign investment and even longer for the remittance of profits from such investments. Nevertheless, for businesses with an eye on the long-run, Myanmar presents an extraordinary Asian opportunity.
Please click the above PDF to read the full alert.