By U AC

Anyone who has been doing any business worthwhile mentioning could not avoid DICA (Directo­rate of Investments and Compa­nies Administration). There are around 100,000 registered com­panies in Myanmar (both local and foreign) that will under the jurisdiction of DICA. It also acts as the secretariat for Myanmar Investment Commission, per­forming all the administrative and other works for the MIC.

DICA has been in the news recently, when the NNCP (NUG, NLD, CRPH, PDF) terrorist groups abused information ob­tained from DICA search, to tar­get specific companies deemed to have some relations with Tatmad­aw (Myanmar’s Armed Forces) or their past and present leaders, based mostly upon make-believe or false information. DICA has since suspended the search func­tion that existed on its website previously. Using that function, anyone could search information relating to a particular company by paying 10,000 Kyats. It is exact­ly the same facility that is made available in other countries e.g., ACRA in Singapore. Now the function is no longer available here.

The other noteworthy recent announcements of DICA included the ban on the use of nominee directors and shareholders and requirement to use corporate bank accounts for companies.

DICA is also in charge of carrying out polices set by MIC, which also included ensuring of the compliance of MIC rules, for those entities what are enjoy­ing the benefits of MIC permit. Investment Monitoring Section is responsible for ensuring that MIC rules, such as capital in­put commitments, local labour requirements, etc., are being complied with by MIC permit­ted companies, be they local or foreign. In terms of getting MIC approvals, Project Assessment Team is there to ensure all the required conditions are met, be­fore the investment/FDI proposal reaches the MIC.

Registration and De-regis­tration

Just like in all countries, the setting up a company is also a piece of cake in Myanmar. It has to be kept this way, so that we remain competitive relative to our neighbouring countries in the region and to signal that this government is pro-busi­ness. The ease of setting up a new business weighs heavily in competitive ranking such as Ease of Doing Business Index. Hence registration of a company can be completed within a couple of days online here.

At the same time, just like an individual, once a company becomes alive, it would have a thousand and one issues, rang­ing from shareholders, directors, employees, taxes, etc. Thus, de-registration is not so straight forward. We need to engage an insolvency practitioner in line with the Insolvency Act, to go through the process of liquidating the company.

The Main Challenge

The main challenge for DICA seems to be balancing the needs of the investors, in accordance with what has been agreed upon the MIC permit and the needs of the country and serving the national interest, in this couple of years of ‘special’ circumstances, while trying to attract future qual­ity investments into the country. For example, there is the free capital repatriation of retained earnings, after tax under MIC permit; which is close to impos­sible under present circumstanc­es. Loan repayments have been temporarily halted by the CBM. Import licenses become incred­ibly difficult to obtain at least in year 2022. And then there is the requirement to change the in­coming $ revenues at the official rate up to a certain %. Obviously, with the NNCP terrorists and other destructive outside forces, hellbent on the country collapse, desperate times require desper­ate measures in order to prevent the country from becoming a failed state. The worse may be over, yet, with the terrorists and external forces planning to do all they can to disrupt the upcoming 2023 elections, those who had be­lieved in Myanmar may still have to ensure at least 2023, become seeing the light at the end of the tunnel.

Current Status

There is good news coming from the FDI CMP (Cut Make Pack) manufacturing sectors. The orders from overseas are back. There are investors still coming into the country espe­cially in solar, CMP and electric­ity generation sectors. The lead country is our neighbouring Thai­land. Maybe they had experience going through more coups than Myanmar and businesses are confident of continued business development after the change of governments.

Meanwhile, exchange and import permit issues are catch­ing up with foreign investors’ #1 complaint of unreliable electricity supply. We must address the elec­trification issue once and for all.

On a related matter, one ex- CIA agent/advisor did mention that the US not wanting closer China-Myanmar ties and rapid economic development of My­anmar, in late 2011, Myanmar NGOs and public were just taught not to criticize the government, demonstrate or attack, but just put forward the environmental concerns incessantly to stop the Myit Sone dam construction. That dam would have fulfilled much of the country’s electricity needs. The scheme seems to have worked as President Thein Sein gave in to the demand of those, hoping that would create unity and peace in subsequent years.

Bring forward a year later, with that Myit Sone scheme already a success, demonstrations and attacks gathered in full force, at­tempting to overthrow Thein Sein government. Lesson in point: Pri­oritizing the country and people development over the concerns of NGOs or paid environmental lobbyists, just like China, may serve the country and the people better in the long run.

Myanmar is definitely in need of a huge electrification project and harsher penalties for terrorists who destroy the na­tion’s infrastructures and compa­nies. That would be a welcoming start for DICA to start attracting an even better crowd of foreign investors.