The New Central Bank Law repeals the Central Bank of Myanmar Law of 1990. However, the Rules, regulations, bye-laws, orders and directives made or issued under the repealed Central Bank of Myanmar Law remain in force, in so far as they are not inconsistent with the provisions of the New Central Bank Law, or are not repealed or superseded.In accordance with the New Central Bank Law, issuing rules and regulations governing the Central Bank of Myanmar will have to be adopted within three months (i.e. 12 October 2013), in order for the law to come into effect. A senior bank officer, Win Hteik, mentioned that in fact, rules and regulations have already been drawn up and that we may expect them to emerge sooner than expected.
The Myanmar government has indicated that the rules and regulations may provide foreign banks with opportunities to participate in Myanmar’s banking industry. Deputy Finance Minister Maung Maung Thien mentioned that these rules and regulations may allow foreign banks to operate in Myanmar through joint ventures. In February, President Thein Sein also announced that foreign banks may be permitted to enter Myanmar with majority-owned joint ventures with local banks. These joint ventures would then eventually be followed by wholly owned subsidiaries and then full branches. However, the regulatory and licensing structure for foreign banks remains unclear.
The opening of Myanmar’s banking sector for foreign banks would be a significant evolution since, so far, foreign banks are currently restricted to setting up representative offices only.
Other Key Myanmar Legal Updates – July/August 2013
