On July 7, 2016, Myanmar’s Ministry of Commerce issued a Notification to remove trade restrictions on local-foreign joint venture companies trading in construction materials.
With the removal of these trade restrictions, local-foreign JVs can now conduct both retail and wholesale trading in construction materials, and they are subject to the same rules and regulations that govern local companies trading in construction materials.
Local-foreign JV companies that want to trade in construction materials must fulfill the following requirements:
- Obtain a permission to trade;
- Meet the local-foreign shareholding ratio requirement;
- Trade only using foreign currencies officially brought into Myanmar (e.g., by wire transfer or cash declared at customs upon entering Myanmar);
- Submit a bank statement and Form 6/26 issued by the Directorate of Investment and Company Administration when applying for an importer/exporter registration certificate; and
- Comply with quality standards issued by the relevant departments.
To date, the authorities have not released a list of construction materials that can be traded, but it is expected to be fixed based on domestic demand, market situation, and the position of local businesses. It is unclear what types of “construction materials” are allowed. More clarity is also needed to understand the local-foreign shareholding ratio requirement.
The removal of these trade restrictions demonstrates Myanmar’s continued commitment to liberate its trade economy and promote foreign investment.