Myanmar’s new Condominium Law in 2016 attracted huge investment interests (especially from foreigners) into the Myanmar’s real estate sector. For the first time, foreigners or foreign companies are now allowed to LEGALLY purchase condominiums in Myanmar.
In 2018, the Myanmar government passed the Condominium Rules (“Rules”) which further eased restrictions on foreign ownership, providing greater clarity to the Law and introducing additional protection for buyers. The Rules are expected to further boost condominium sales and reduce excess supply in the market especially in the medium – high end residential sector. The Rules are also expected to attract new projects and developments, particularly in the Yangon region – the focal point of foreign property investment.
The Rules provide that foreign purchasers are allowed to acquire up to 40% of the total floor area of the condominium as opposed to the earlier draft rules which only allows 40% of units located above the sixth floor of a condominium. Foreign purchasers are now able to purchase and reside in low-rise condominiums. Foreigners are also now allowed to be joint-developers to jointly develop condominiums with their local counterparts. A MIC Permit or Endorsement is required when foreigners are involved in a joint development project.
A number of restrictions have been placed on the Developer to safeguard the interests of the buyers, for example, Developers are only allowed to sell after 30% of the foundation has been completed. The Developer is further required to deposit an amount equivalent to 20% of the total cost or such amount as indicated by the authorities (for capital-intensive projects) in its bank account.
The Rules do not only govern new condominiums but also existing condominiums as well as those currently under development provided that they fall under the definition of “Condominium” under the Law which provides that:
(a) the building to have at least six floors;
(b) it stands on land with an area of at least 20,000 square feet (0.5 acres; 1,858 square metres); and
(c) the land owner agrees to convert the land to a “collectively owned land”.
With the passing of the Law and Rules, the Myanmar government has undertaken huge efforts to promote and ease foreign investments in the real estate market. While many challenges and uncertainties lay ahead, demand in the condominium market is expected to rise especially for units in the mid-range bracket.
If you are interested in starting your own business / investment in Myanmar – send us an email at jeff.leong@jlpw.com.my / usanlwin@jlpw.com.my / kenny.poon@jlpw.com.my. Our legal firm in Myanmar, JLPW Legal Services (Myanmar) Co., Ltd., will be there to assist you with all your investment queries and needs.
Website :
www.jlpw.com.my
www.jlpw.com.my/needlawyer
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Published by Jeff Leong
I am the senior partner of Messrs Jeff Leong, Poon & Wong, Malaysia.
I am also serving with the Law Association For Asia And The Pacific (LAWASIA), the peak body for national bar associations and law societies in more than 40 jurisdictions in the Asia Pacific region as Chair of the Corporate, Securities & Investment Law and Co Chair of the Belt And Road Initiative Standing Committees.
I lead a Special Projects team, structure and run complex M&A deals, resolve critical problems faced by clients such as crisis management, regulatory investigations, shareholder fights and board tussles and advise founders, business owners and senior management on business transactions.
With numerous IPOs and M&A deals over 30 years, I am often consulted by clients in Shipping and Logistics, Technology and Digital Economy, Oil & Gas and other heavily regulated industries on complex, urgent and critical matters.
I have been included on Asia Business Law Journal’s A List of Malaysia’s Top 100 Lawyers and Legal 500’s Hall of Fame for Corporate and M&A for Malaysia.
I am an accredited Mediator of the Malaysian Mediation Centre, the International Commercial Mediation Centre For the Belt And Road Initiative, Benchmark Chambers International & Benchmark International Mediation Centre, Shenzhen Qianhai International Commercial Mediation Centre, CCPIT/CCOIC Hangzhou Mediation Centre and Hainan International Arbitration Court.
I founded JLPW in 1999 during the 1997 Asian Financial Crisis with 2 other founders. We were deep into corporate rescues and mergers of banks, insurance companies and stockbrokers to resuscitate the bleeding Malaysian economy, working on some of the major corporate rescues of the 1997 Asian Financial Crisis.
Affiliations with Deacons Graham & James 2001- 2012 and Dacheng (now Dentons China) 2012-2016 quickly followed. In 2012, we founded JLPW CROSSBORDER ASIA, a regional law firm network.
In JLPW, we developed the current due diligence system adopted and used by industry participants in capital markets transactions in 1999. I assisted the review of the 2020 Due Diligence Guide for Malaysia with investment bankers, accountants, capital market lawyers and other industry participants.
I currently lead our Japan Services Group, assisting Japanese companies venturing into Malaysia and South East Asia with market entry strategies, M&As and post merger integration advisory together with our Japanese speaking team.
I am also leading our China Services Group and regional JLPW Belt and Road Services Group assisting Chinese companies investing and undertaking Belt and Road projects in Malaysia and other ASEAN countries.
As leader, strategist, chief talent scout, builder and problem solver, I have initiated and developed various practice groups in JLPW and am now leading our Legal Tech initiatives to better support our clients in the new Digital Economy.
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