Question: We are now desiring to set up a Subsidiary Company in Republic of the Union of Myanmar (hereinafter referred to as“Myanmar”) in the field of environmental technical service (hereinafter referred to as “Subsidiary”), please advise legal procedure?
Answen: SBLAW would like to advise as follows:
1.OUR PRELIMINARY COMMENT
1.1. CONDITIONS TO OFFSHORE DIRECT INVESTMENT
According to Decree No. 78/2006/ND-CP providing for offshore direct investment, Vietnamese investors have to meet the following conditions:
(i) Having offshore direct investment projects (hereinafter called investment projects).
(ii) Fulfilling all financial obligations towards the State of Vietnam.
(iii) Observing the provisions of law on management and use of state capital, for cases of using state capital for offshore direct investment.
(iv) Having been granted investment certificates by the Ministry of Planning and Investment.
Follow or parallel to procedures for granting the Investment Certificate at the Foreign Investment Department of Vietnam Ministry of Planning and Investment, the Customer will also conduct the procedure in a foreign country (Myanmar) to apply for a Certificate of Company Establishment. In the process of approve the offshore direct investment dossier, the Ministry of Planning and Investment may require the evidence document, from that, Client is accepted to set up a company in Myanmar by the competent authority of Myanmar. And this document will be used as the basis for approve of offshore direct investment. Therefore, Client can conduct two above procedures concurently to save time.
1.2. FIELD OF ENCOURAGEMENT, FORBIDDEN, LIMITATION OF OFFSHORE INVESTMENT
After comparing with the legal documents, SBLaw find out that the business lines that your Company intends to invest abroad are not prohibited and restricted in accordance with the law.
1.3. APPROVAL COMPETENCE REGARDING INVESMENT PROJECT
As stipulated in Decree No. 78/2006/ND-CP, the approval of Prime Minister regarding investment project is required in case of the following cases:
(i) Projects of investment in banking, insurance business, financial, credit, journalism, radio or television broadcasting or telecommunications domains, which are funded with VND 150 billion or more of state capital, or VND 300 billion or more of capital of other economic sectors.
(ii) Investment projects defined in Clause 1 of this Article, which are funded with VND 300 billion or more of state capital or VND 600 billion or more of capital of other economic sectors.
Thus, in case the capital that your Company intends to invest to Myanmar fall into the above cases, before licensed by the Ministry of Planning and Investment , you must get the approval of the Prime Minister.
1.4. COMPETENCE AND PROCEDURE FOR GRANTING INVESTMENT CERTIFICATE
The Ministry of Planning and Investment competent to grant the investment certificate for the whole of offshore direct investment project, the project needs and does not need the approval of the Prime Minister.
The granting of investment certificate shall comply with the following procedures:
(i) The process of registration and grant of investment certificates, applicable to investment projects capitalized at less than VND 15 billion.
(ii) The process of examination and grant of investment certificates, applicable to investment projects capitalized at VND 15 billion or more.
Besides, after licensed by the Ministry of Planning and Investment, Client need to conduct the registration procedures to open offshore investment accounts in State Bank of Vietnam.
During operation period, investment canpital transferred out of Vietnam or business profits moved into Vietnam must be made through this account. The Company must comply with the provisions of current legislation relating to foreign exchange control, tax or financial obligations in the course of implementing projects of offshore direct investment.
- ROADMAP OFPROCEDURES
Implementation roadmap of procedures for registration the Certificate of offshore investment will be carried out with the following steps:
– Drafting dossier for granting the Investment Certificate matching with requirements of the law and licensing authorities and other bodies to submit at the Department of Foreign Investment. The duration to complete the preparation of the dossier and transfer in the first time to Client for reviewing is 07 days from the date of receiving full information and documentation as required by Consultant;
– Within 02 working days from getting comments or request of Client on the dossier, we will edit for Client to sign these documents;
– Conducting to submit dossier to the licensing authority;
– Contacting, explaining and supplementing documents with the competent authority On behalf of Client;
– Receiving Certificate of Offshore Investment from licensing authority On behalf of Client. Within 20 working days from the date of submission of valid dossiers, we will receive the Certificate of Offshore Investment in case the project is under registered investment case. Within 50 working days from the date of submission of valid dossiers, we will receive the Certificate of Offshore Investment in case the project is under examined case;
Note: To avoid any doubts, SBLAW and Client hereby confirm that any delay or lateness in the progress of work comes from reasons beyond the control of SBLAW including but not limited to change of laws, response of state agencies competent, Client changes its request ect, will not be included in the term of service.
- Scope of works
Our scope of work shall be as follows:
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- DELIVARABLES
Delivarablesincluding documents be prepared by Myanmar language and Vietnamese to submit to the licensing authority.
