In April 2022, Myanmar's State Administration Council established the Foreign Exchange Supervisory Committee (FESC) to approve foreign currency conversion, make exemptions to foreign exchange restrictions, and permit overseas foreign currency transfers. Because of the FESC's establishment and related regulatory changes, companies that would like to transfer funds out of Myanmar for capital reduction, share capital for liquidated companies, share transfers, or share dividends must abide by the FESC's requirements, which vary depending on the type of company.
The Myanmar Investment Commission (MIC) has announced that companies permitted by or endorsed under the Myanmar Investment Law must submit various supporting documents when applying to transfer foreign currency internationally. These documents, which must be addressed to the MIC chairman, include the following:
- Prescribed form for transfer of foreign currency;
- Application letter giving a specific reason for the transfer;
- Original board of directors' resolution;
- Audited financial statements for the relevant financial year;
- Up-to-date bank statement of the company;
- Tax assessment confirmation letter for the relevant financial year;
- Tax clearance certificate for the relevant financial year, in the case of liquidated companies; and
- Copy of the updated quarterly performance report using the form prescribed by the MIC.
If the transferor cannot submit the documents in person, the required documents need to be accompanied by a power-of-attorney or appointment-of-representative letter.
Though the FESC has not announced its own documentation requirements, experience shows that MIC companies must submit an application to the MIC Investment Monitoring Division before submitting their offshore remittance application to the FESC. Once the MIC has received a complete application, it will request a recommendation from the Central Bank of Myanmar (CBM). With this recommendation in hand, the Investment Monitoring Department will then seek FESC approval internally.
Aside from MIC companies, DICA companies (i.e., companies that do not require approval from the MIC for their business activities) must submit their applications for offshore transfers to the CBM and FESC offices.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.