The Myanmar Companies Regulations 2018 was published on 23 July 2018 (the “Regulations”). In addition to setting out the requirement for the re-registration of existing companies and branches, the Regulations deal with a number of key transitional provisions.

Transition to no par regime: Section 60(b) of the MCL states that a share will not have a nominal or par value. The Regulations confirm that this section applies to all shares whether issued before, on or after 1 August 2018. The concept of paid up capital and partly paid shares will continue to be relevant under the new law. The Regulations confirm that the amount paid to the company at any time for the share is the amount paid on the share and the difference between the price of issue and the amount paid on the share is the amount remaining unpaid on the share. It is also confirmed that the amount standing to the credit to a company’s share premium account and capital redemption reserve becomes part of the share capital.

The following provisions contained in the memorandum and articles of association of an existing company are deemed to be deleted: (i) the amount of share capital with which an existing company is registered or proposed to be registered and (ii) the division of the share capital into shares of a fixed amount.

Resident director: If a company contravenes such requirements, DICA may either on its own motion or the application of another direct members of such company to appoint a resident director.

If a company carries on business without a resident director for more than six months, a person who is a member of the company and who knows that it is carrying on business in such manner after such six month period, is liable for the payment of all debts of the company contracted during the relevant period (or the part of it).

Registration of overseas corporations: Under the MCL, the general position is that an overseas corporation is required to register to carry on business in Myanmar. Section 43(b) of MCL sets out certain activities which are not deemed as “carrying on business”. The Regulations clarify that “carrying on business”: (i) includes the administration, management or otherwise dealing with property situated in Myanmar as an agent, a legal personal representative, or a trustee, whether by employees or agents or otherwise; and (ii) does not exclude activities carried on without a view to any profit.

Special Companies Act 1950 (the "SCA"): The Regulations also confirm the continued role of the SCA. A company in which a Myanmar Government body holds any shares is formed under the SCA and registered under the MCL. Unless otherwise permitted under the SCA, a company formed under the SCA is subject to the provisions of the MCL. If a Myanmar Government body no longer holds shares in a company formed under the SCA, such company ceases to be a “special company” and is deemed to be registered under the MCL and a new certificate of registration will be issued by DICA.

A small company: A private company (which is not a subsidiary of a public company) is classified as a small company if that company and its subsidiaries has no more than 30 employees and annual revenues of less than MMK50m. A small company has a lower regulatory burden as it is exempted from a number of reporting and meeting requirements. The Regulations confirm that in order to benefit from the exemptions, a company is required to meet the above stipulations throughout the year.