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PART I DRAFT MYANMAR COMPANIES LAW

PRELIMINARY
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1.

Citation and commencement of this Law

(a)

This Law may be cited as the Myanmar Companies Law 2015 and it commences on [the date on
which it is enacted.]

(b)

The previous law, including the schedules, is repealed upon commencement of this Law.

(c)

Following its repeal, anything done or in process under the previous law shall be taken to be done
or in process under this Law, subject to, and as further provided by, Division 4 of Part [VII].

2.

Definitions
In this Law, unless there is anything repugnant in the subject or context:
applicable law means any law, regulation, rule, order, notification, directive or other
authority or instrument having the force of law in the Republic of the Union of Myanmar
which may have an affect on the matter concerned;
associate:

(a)

specifically, in relation to a company means:

This column sets out the numbering of the legislative provisions in the draft law. Please note that the provisions will be renumbered in a logical sequence once
the draft law is finalised.
2
This column sets out the proposed legislative provisions (and headings) for the new law.
3
This column sets out commentary and explanation for proposed legislative provisions to assist readers in understanding the draft law.
1

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i)

a director, managing agent or secretary of the company;

ii)

a related body corporate; and

iii)

a director, managing agent or secretary of a related body corporate; and

(b)

generally, in relation to a person (including a company) means:

i)

a person in concert with whom the person is acting, or proposes to act in relation to the relevant
matter;

ii)

a person with whom the person is, or proposes to become, associated, whether formally or
informally, in any other way in relation to the relevant matter; and

iii)

a prescribed person in relation to the relevant matter,

but does not in any case include someone who may otherwise be considered an associate under
paragraph (c) merely because they:

(c)

give advice to the person, or act on the persons behalf, in the proper performance of the
functions attaching to a professional capacity or a business relationship; or

(d)

have been appointed to as a proxy or representative of a person at a meeting of members, or of

a class of members, of a company.
[authorised officer means:
(a) a director resident in Myanmar designated by; or
(b) other person resident in Myanmar appointed by,
the company to act as its representative for the purpose of this Law;]
board has the meaning given in section [83A.2];

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company means a company formed and registered under this Law or an existing company;
corporation means a body corporate formed under a law other than this Law, including a law
of a jurisdiction other than the Republic of the Union of Myanmar, whether or not it is
registered under this Law;
Court means the Court having jurisdiction under this Law;
debenture includes debenture stock;
director has the meaning given in section [83A.1];
existing company means a company formed and registered under the Indian Companies Act,
1866, or under any Act or Acts repealed thereby, or under the Indian Companies Act, 1882 or
under the previous law;
financial assistance includes the giving of financial assistance by means of the making of a
loan, the giving of a guarantee, the provision of security, the release of an obligation or the
release of a debt or otherwise;
foreign company means a company in which an overseas corporation or other foreign person
(or combination of them) owns or controls an ownership interest of more than the prescribed
ownership amount;
holding company in relation to a body corporate, means a body corporate of which the first
body corporate is a subsidiary;
managing agent means a person, firm or company entitled to the management of the whole
affairs of a company by virtue of an agreement with the company made pursuant to Division 5
of Part IV, and under the control and direction of the directors except to the extent, if any,
otherwise provided for in the agreement, and includes any person, firm or company occupying
such position by whatever name called;
Minister means the Minister of the Government of the Republic of the Union Of Myanmar

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whose responsibilities include the administration of this Law and the supervision of the
Registrar;
[Myanmar company means:

(a)

in the case of a company having a share capital, a company whose entire share capital is, at all
times, owned and controlled by the citizens of the Union of Myanmar, or

(b)

in the case of a company limited by guarantee but not having a share capital, a company which
is, at all times, owned and controlled by the citizens of the Union of Myanmar;]

Note: definition may not be

required.

officer has the meaning given in section [83A.3];

overseas corporation means a body corporate that is incorporated outside Myanmar;
ownership interest means a legal, equitable or prescribed interest in a company which may
arise though means including:

(a)

a direct shareholding in the company;

(b)

a direct and indirect shareholding in another company which itself holds:

(i) a direct shareholding; or
(ii) an indirect shareholding,
in the first company; or

(c)

through an agreement which provides the holder with a direct or indirect right to exercise
control over the voting rights which may be cast on any resolution of the company;
penalty unit means the amount, expressed in Kyat, prescribed by the Minister from time to
time;
prescribed means prescribed by or in a regulation, rule, order, notification, directive, table or

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form made under this Law;

prescribed ownership amount means the amount, expressed as a percentage, prescribed by
the Minister;

This amount will be prescribed

on the commencement of the
law (expected to be 50%).

previous law means the Myanmar Companies Act 1914;

private company means a company which:

(a)

must limit the number of its members to fifty not including persons who are in the employment
of the company; and

(b)

must not issue any invitation to the public to subscribe for the shares, debentures or other
securities of the company:
Provided that where two or more persons hold one or more shares in a company jointly they
shall, for the purposes of this definition, be treated as a single member;
prospectus means any prospectus, notice, circular, advertisement or other invitation, offering
to the public for subscription or purchase any shares or debentures or other securities of a
company, but shall not include any trade advertisement which shows on the face of it that a
formal prospectus has been prepared and filed;
public company means a company incorporated under this Law or under the Indian
Companies Act, 1882, or under the Indian Companies Act, 1866, or under any Act repealed
thereby or under the previous law, which is not a private company;
registrable interests means any securities for which a company maintains a register in
accordance with Division 3 of Part [III].
Registrar means the Directorate of Investment and Company Administration or such other
body or person as may be prescribed to perform under this Law the duty of registration of
companies and exercise the other powers and perform the other functions and duties assigned

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to the Registrar under this Law or other applicable law;

related body corporate of a body corporate means:

(a)

a holding company of the body corporate;

(b)

a subsidiary of the corporate; or

(c)

a subsidiary of a holding company of the corporate;

related party means:

(a)

in relation to a body corporate, a person which controls the body corporate; and

(b)

in relation to a person (including a body corporate):

i)

an associate of the person;

ii)

a spouse, parent or child of an associate of the person; and

iii)

a body corporate controlled by any of the persons referred to in paragraphs (a) or (b)(i) and (ii)
above.
[Scheduled Bank means a bank which has been notified under section 38 of the Union Bank
of Myanmar Act, 1952, as a scheduled bank;]

Note: may no longer be

required.

security interest means a charge, lien, mortgage or pledge or any other form of security
interest prescribed or recognized under this Law or other applicable law;
share means share in the share capital of the company, and includes stock except when a
distinction between stock and shares is expressed or implied;
small company means a company, other than a public company, which satisfies at least two
of the following conditions:

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(a)

it and its subsidiaries have less than [50] employees (or such other amount as may be
prescribed under this Law);

(b)

it and its subsidiaries have issued share capital of less than [500,000,000] Kyats in aggregate
(as valued at the time of issue) (or such other amount as may be prescribed under this Law); or

(c)

it and its subsidiaries have annual revenue of less than [50,000,000] Kyats) in aggregate (or
such other amount as may be prescribed under this Law);
solvency test means that:

(a)

the company is able to pay its debts as they become due in the normal course of business; and

(b)

the companys assets exceed its liabilities,

in each case as determined in accordance with the accounting standards applicable to such
companies or prescribed by the Registrar from time to time;
subsidiary in relation to a body corporate, means:

(a)

a body corporate of which the first body corporate:

i)

controls the composition of the board of the body corporate;

ii)

is in a position to exercise, or control the exercise of, more than one-half the maximum number
of votes that can be exercised at a meeting of the body corporate;

iii)

holds more than one-half of the issued shares of the body corporate, other than shares that carry
no right to participate beyond a specified amount in a distribution of either profits or capital; or

iv)

is entitled to receive more than one-half of every dividend paid on shares issued by the body
corporate, other than shares that carry no right to participate beyond a specified amount in a
distribution of either profits or capital; or

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(b)

a subsidiary of a body corporate that is the first body corporate's subsidiary;

transition period means the period of [12] months from the date of commencement of this
Law;
ultimate holding company, in relation to a body corporate, means a body corporate that:

3.

(a)

is a holding company of the first-mentioned body corporate: and

(b)

is itself not a subsidiary of any body corporate.

Jurisdiction of the Courts

(1)

Subject to other applicable laws, the Court having jurisdiction under this Law shall be the
[Supreme Court]: Provided that any [High Court, District Court or Township Court] may, in
accordance with applicable law, exercise all or any of the jurisdiction by this Law conferred
upon the Court.

(2)

For the purposes of jurisdiction to wind up companies, the expression registered office
means the place which has longest been the registered office of the company during the six
months immediately preceding the presentation of the petition for winding up.

(3)

Nothing in this section shall invalidate a proceeding by reason of its being taken in a wrong
Court.

Other applicable laws include

the Code of Civil Procedure.