Welcome to the latest edition of our Myanmar update where we distill the latest Myanmar news for you. This month we look at the opening of AIIB, a post-election update, and an update on Extractive Industries Transparency Initiative (EITI)
Myanmar’s newly elected parliament, led by the National League for Democracy (NLD), will convene for the first time on 1 February 2016. The new government must be formed before 31 March 2016, yet it remains unclear who will be the new president and two vice presidents of the country. The elected representatives of the upper house, elected representatives of the lower house and unelected army representatives (which holds a quarter of the seats in the legislature) will each need to nominate a candidate in the coming weeks, so that a joint session of elected and unelected representatives can be held to elect the new president.
Parliament approves three bills
On 22 January 2016, Myanmar’s parliament passed the Banks and Financial Institutions Bill, the Condominium Bill and the 2016 Union Taxation Bill. We will publish a summary of these bills in due course.
Myanmar gives effect to New York Convention by enacting Arbitration Law
Myanmar’s parliament enacted the much-anticipated Arbitration Law (Union Parliament Act No. 5 of 2016) on 5 January 2016, replacing arbitration legislation which was more than 70 years old. See our summary of the new Arbitration Law.
Opening of AIIB – Myanmar poised to receive funds for projects
On 25 December 2015, the Asia Infrastructure Investment Bank (AIIB) was formerly established in Beijing. AIIB is an international financial institution established with the purpose of providing finance to infrastructure projects in Asia. Myanmar is one of the first countries to join the AIIB, which currently has 57 country members, and has approved a US$264.5million contribution to the AIIB. Myanmar is already an existing member of the International Monetary Fund, the World Bank, the International Finance Corporation (IFC) and the Asian Development Bank (ADB); each of which have already provided financial aid to the country. It is hoped that further funding from the AIIB will help improve infrastructure across the country and enhance economic development.
New environmental impact rules released by The Ministry of Environmental Conservation and Forestry (MOECAF)
On 14 February 2016, MOECAF issued the Environmental Impact Assessment Procedure (EIA); a new set of rules for evaluating the environmental impact of local projects (EIAP English translation). The EIA, which was drafted with support from ADB, is tailored for Myanmar and has been developed based on IFC guidelines and conclusions drawn from the experiences of neighbouring countries.
The EIA focuses on ensuring project transparency, stakeholder acceptance and environmental conservation whilst minimising costs. Project investors must self-monitor projects, publicise relevant information, and report back to government departments. According to the EIA procedure, if a company fails to communicate necessary project information, it may be fined between US$1000 and US$5000, or the equivalent in Kyat.
Myanmar investment protection agreement with the European Union (EU)
The Myanmar-European Union Investment Protection Agreement (MEIPA), an agreement aimed at improving the protection and fair treatment of investors and attracting investments into Myanmar and the EU, is expected to be signed in the first half of this year. However, over 500 civil society organizations in Myanmar have expressed concerns about the MEIPA with a letter dated 14 January 2016 to the EU Commissioner for Trade. In the letter, civil society organisations have indicated that Myanmar is still at its very early stages of democratisation and peace building and that an MEIPA at this stage will “severely endanger [Myanmar’s] prospects for democracy and sustainable peace.” Click here to read a copy of the letter.
Update on Extractive Industries Transparency Initiative (EITI)
In August 2014, we reported that Myanmar was accepted as an ‘EITI Candidate’.
On 2 January 2016, Myanmar submitted its first Extractive Industries Transparency Initiative (EITI) Report for the period April 2013 – March 2014 to the EITI International Secretariat. This is a significant milestone in Myanmar’s path towards “EITI Compliant” status. The report summarises fiscal and non-fiscal revenues across three sub-sectors of the extractive sector – oil and gas, gems and jade and other minerals. The purpose of the report is to reconcile data provided by companies operating in the extractive sector and data provided by the Government. The report also sets out recommendations to support Myanmar’s graduation to “EITI Compliant” status. Myanmar has until January 2017 to meet all requirements set out by the EITI in order to gain “EITI Complaint” status.