More Detailed Procedures for Annual Returns of Companies and Overseas Corporations in MyanmarJanuary 21, 2019
The new Myanmar Companies Law (“MCL”) introduced refreshed procedures and timing in terms of holding your Annual General Meeting (“AGM”) and filing an annual return in the Myanmar Companies Online (“MyCo”) system.
The annual return form for overseas corporations (Form E-7) has been available in the MyCo system since 2 November 2018, while the annual return form for companies shall be released post 31 January 2019.
Companies registered in Myanmar
Previously, AGM documents had to be submitted to the Directorate of Investment and Company Administration (“DICA”) together with the Form E (annual return) and a copy of audited financial statements of the company. The deadline for holding your AGM remains the same, however companies are no longer required to submit those documents to the Registrar. The company will now have to file the new annual return form on the MyCo system and will have to do so within 2 months from its incorporation, and thereafter once at least in every calendar year (but no later than 1 month after the anniversary of its incorporation).
Even though the business objects are no longer required under the MCL, the company will have to include in the annual return particulars of the company’s principal activity or activities at the date to which the company’s accounts are made up, including:
- Whether the company has either become or ceased to be a foreign company since the date of the last return and the date on which such changes occurred;
- The names of all of the company’s subsidiaries, holding companies and the ultimate holding company, if any;
- Confirmation that the mortgages and charges which are required to be registered with the Registrar under the Law have been registered.
The company will not only have to file the annual return of particulars with MyCo, but also record it in a separate part of the register of members. The return and copy will have to be signed by a director or secretary of the company with a statement that the facts are as they stood on the day aforesaid.
In addition, private companies will also have to attached a statement to the MyCo filing that the company has not issued any invitation to the public to subscribe for any shares or debentures of the company. Submission of audited financial statements is no longer required.
Every director and officer of the company who is knowingly and willfully involved in the default of maintaining registers and ensuring that the relevant filings are made in accordance with MCL shall be liable to a fine of MMK 500,000.
Overseas corporations (including branch and representative offices)
Every overseas corporation conducting business in Myanmar must within 28 days of the end of its financial year file an annual return with the Registrar to confirm that the details of the overseas corporation held by the Registrar are complete and up to date.
Under the previous regime, only an updated list of directors of the parent company and its audited financial statements were required to be submitted.
The MCL extends the requirement to a full annual return (Form E-7) requiring confirmation on the accuracy of information entered in the MyCo system. If all information is not up to date, then the annual return cannot be filed until all changes have been notified to the Registrar in the system using the specific forms. In addition, the overseas corporation will have to provide information on its principal activity or activities in the Union.
Moreover, at least once each calendar year and at intervals of no more than 15 months, every overseas corporation conducting business in Myanmar will have to file with the Registrar in format prescribed by the law of the country of incorporation:
- a balance sheet made up to the end of its last financial year;
- a copy of its cash flow statement for its last financial year; and
- a copy of its profit and loss statement for its last financial year;
If in the country of origin, the overseas corporation is not required to file any of the statements mentioned above, then DICA can require the company to prepare any of the above financial statements in the form applicable to public companies incorporated in Myanmar or in other form as may be prescribed. DICA can also require any financial statements to be audited.
An overseas corporation which fails to comply with any of the above requirements and every director and authorized officer will be liable to a fine of MMK250,000 in respect of each breach.
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