THE Directorate of Investment and Company Administration (DICA) issued mandatory compliance with the directors’ and shareholders’ rights under the Myanmar Companies Law (2017).
DICA issued a directive 59/2018 regarding directors and shareholders of public companies on 9 July 2018. This recent notification about the obligations of directors and rights of the members/shareholders of the companies is aimed at having corporate governance transparency and preventing disputes among companies and shareholders.
Under Section 203 of the Myanmar Companies Law 2017, companies or representatives must lodge a prospectus with the Securities and Exchange Commission of Myanmar and receive approval after seeking company registration, before commencing operations. The prospectus must be filed with the Registrar along with the prescribed form. Only after that, they can issue public share offerings and debentures.
According to Section 211 (A) of the Myanmar Companies Law (2017), a Statement in Lieu of Prospectus can seek business approval, yet prohibits public share offerings. Afterwards, in Section 218 (A) of the Myanmar Companies Law 2017, the prescribed form must be filed to obtain the Certificate of Commencement of Business of a Public Company.
Furthermore, all public companies must hold a Statutory Meeting not earlier than 28 days and within six months of incorporation under Section 148 of the Myanmar Companies Law. The Statutory Report must be distributed to all shareholders and members of the company 21 days in advance and must be reported to the Registrar with the prescribed form.
As per Subsection (B) of Section 173 of the Myanmar Companies Law, one-third of directors must retire at every Annual General Meeting, especially appointed directors with the longest job tenure.
AGM must be held within 18 months of the incorporation, and subsequent meetings must take place once every year (with no more than 15 months between meetings) in line with Section 146 of the Law.
Shareholders and members of the companies must have opportunities to raise questions about management and express opinions during the meetings.
Financial Statements approved by the shareholders and members of the public companies must be elaborated at a general meeting in the prescribed form, under Section 266 of the Law. The financial statement and audited statements must be sent to the invitees according to Subsection C of Section 260 of the Law.
All registered public companies need to submit an Annual Return (AR) within two months of incorporation, and at least once every year (not later than one month after the anniversary of the incorporation), with the attachment of the summary and statements of the shareholders and members, according to Section 97 of the law.
Under Section 99 of the law, shareholders or individuals must have access to check shareholder registers, director registers and other statutory records. They are also allowed to get a copy within ten days after paying some charges. Subsection 99 (B) of the law also stated that the companies must have transparency of company information and provide public access through websites to entice investors, DICA notified. — NN/KK
