RANGOON — The new Myanmar Investment Law has been submitted to Parliament and is expected to be approved by October, following discussion by lawmakers and before the current parliamentary session ends.
Ministry of National Planning and Finance Deputy Minister U Maung Maung Win put forward the investment draft bill to the Lower House on Tuesday, following an announcement by the US government that economic sanctions against Burma would soon be lifted.
The bill has been through various drafts, beginning under the previous government. There was a push to submit it to Parliament following State Counselor Daw Aung San Suu Kyi’s visit to the United States and call for increased US investment in Burma.
The new draft bill combines the Burma Citizens Investment law—enacted in July 2013 and governing local investment—and the Foreign Investment law—enacted in November 2012 and governing foreign investment—into one law.
“Combining these two laws will help create a better investment environment,” said U Maung Maung Win.
The draft law reduces the mandate of the Myanmar Investment Commission (MIC) and provides a more tailored approach to tax exemptions, according to the deputy minister.
U Than Aung Kyaw, deputy director general of the Directorate of Investment and Company Administration (DICA) told The Irrawaddy that the law had been changed significantly from former versions and that it is expected to be passed before the end of the current parliamentary session, which concludes in early October.
“We are trying to approve it soon, as a result of Daw Aung San Suu Kyi’s visit to the United States,” he said.
Under the existing investment law, every investment must have the approval of the MIC. Under the draft law, there will be different guidelines needed for MIC approval.
The government will directly handle the investment proposals that are deemed strategically important, require a substantial amount of capital, or could potentially have social and environmental impacts, according to the planning and finance ministry.
The parliamentary session was scheduled to end Sept. 23 but that has been postponed until Oct 7 so that Parliament can debate and pass the investment law.
The new bill includes more strategic tax incentives. If the government chooses to promote a certain business or sector, related investors will receive tax incentives, U Than Aung Kyaw said.
The bill also incentivizes investment in less developed areas.
Lower House lawmaker and businessman Dr. Thet Thet Khine told The Irrawaddy that the country also needed adequate electricity, clear laws and good transportation in order to attract international investment. He said the country should invite investments that would improve infrastructure.
U Nay Myo Htun, a Lower House lawmaker from Htantabin Township said the new law will boost investor confidence.
The Lower House Bill Committee agreed and called the draft law an impetus for technological and industrial development in line with international norms.
“There were some problems having two separate laws in the past. Foreign investors sometimes thought they were being discriminated against, which impeded the country’s growth,” Bill Committee Chairman U Tun Tun Hein told The Irrawaddy.
The draft law has been approved by the State Counselor’s Office. Drafted with the help of the International Finance Corporation, it has 23 chapters and 104 clauses, and the definition of terms in the draft law is in line with other international laws.