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Currency Exchange Control
The primary legislation governing foreign exchange matters is the Foreign Exchange Management Law 2012 (FEML 2012). Foreign currencies currently permitted to be sold and purchased by authorized dealers in Myanmar are:
- US Dollars (USD);
- Euros (EUR);
- Singapore Dollars (SGD);
- Thai Baht (THB); and
- Malaysian Ringgit (MYR).
The USD is the most commonly used foreign currency in domestic and international transactions in Myanmar, widely complementing the use of the national currency, Myanmar Kyat (MMK), in domestic transactions. Domestic transactions between government entities in Myanmar are restricted to MMK. Locally incorporated entities and Myanmar residents are allowed to open both MMK and foreign currency accounts with Myanmar banks.
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More than 80% foreign shareholding |
Up to 80% foreign shareholding |
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Wholesale trading |
Minimum initial investment of US$5 million |
Minimum initial investment of US$2 million |
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Retail trading |
Minimum initial investment of US$3 million |
Minimum initial investment of US$700,000 |
Under the FEML 2012, capital transactions require approval from the Central Bank of Myanmar.
As for other types of payments from a Myanmar payer to a foreign recipient (for example, franchise fees, training fees, and advertising and marketing fees), the Myanmar payer must first obtain approval from the Foreign Exchange Management Board and the Central Bank of Myanmar. The Myanmar payer must provide clear reasons for the remittance request, supported by documentation and evidence that explains the purpose of the remittance. Hence, it is necessary for the parties to enter into written contracts.
The bank will scrutinise the details of the remittance application and obtain approval from the respective regulatory bodies before remitting the funds to the foreign recipient.
Concluding Remarks
With the liberalization of Myanmar’s economy, foreign companies should seize the opportunity to be one of the early movers into Myanmar.
Myanmar is currently still undeveloped, Managedline business consultancy has a deep understanding of the regulatory and business environment in Myanmar. We are well equipped to assist clients with complex legal matters across a wide range of disciplines.
The latest media news about Myanmar: Economics
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