The government’s newly expanded requirements on hiring foreign employees announced in October are only applicable to companies permitted by the Myanmar Investment Commission (MIC).
The Directorate of Investment and Company Administration (DICA) issued a statement to clarify its earlier announcement – “Appointment of foreign experts” (AFE) – which entered into force on October 21.
Under the October statement, a company is required to submit a work permit application for the appointment of a foreign expert and it must also notify the MIC together with documentary evidence of resignation and departure airline ticket if the foreign expert resigns prior to, or at the end of the permitted period in Myanmar. There was confusion over whether the AFE was applicable to all investors wishing to hire foreigners.
DICA’s statement released last month said that the purpose of the earlier announcement was to “conduct the appointment of foreign experts through transparent, simplified and quick procedures” and to streamline those procedures with the Investment Law.
It added that the original announcement “is only applicable to businesses that appoint foreign experts and are operating with the permission of the MIC”.
Still, a request for the appointment of foreign experts to be made before or within seven working days following the arrival of the “foreign experts” remains.
“Although the commission is providing investment facilitation to investors for the appointment of foreign experts and extension of visas, some investors are appointing foreign experts without the permission of the MIC and submitting the appointment of foreign experts just before or after the expiration of their visas.
“Moreover, investors are liable to notify the commission if the appointed foreign expert resigns before or after the expiration date of the employment contract,” the statement read.
It argued that the appointment of foreign experts is already promulgated in the investment law and investment rules. Therefore, companies that are carrying out their businesses under MIC’s permit must follow the regulations.
Eric Rose, lead director of Herzfeld Rubin Meyer & Rose (HRMR), told The Myanmar Times that the clarification represents a narrowing of the originally broad scope of the earlier announcement, in conformity with existing legislation.
“There was no legal authority for the previous broad announcement, except for the MIC-permitted companies, which DICA has now resolved,” he noted.
In October, businesses had accused the new requirements on hiring foreigners as “burdensome and disruptive”. DICA’s follow-up explanation has clarified some of the confusion over the new regulations.