Property Rights of Foreigners in Myanmar
Definition of Property
As the type of property is concerned, there are two mainly types of property; immovable property and moveable property. According to Myanmar Laws, “immovable property” includes land and any other benefit to arise out of land, buildings and things attached to the earth or permanently fastened to anything which is attached to the earth, but not include standing timber, growing crops and grass. Any property, except immovable property, shall be defined as movable property.
Transfer of Immovable Property Restriction Law, 1987
The Transfer of Immovable Property Restriction Law, 1987 (“TIPRL”) (amended in 2005) must be noticed for foreigners or foreign companies in the transfer of immovable property. The notable provisions for foreigners or foreign companies are as follows;
Section 3 of TIPRL: No person shall sell, buy, give away, pawn, exchange or transfer by any means immovable property with a foreigner or foreigner owned company.
Section 4 of TIPRL: No foreigner or foreign owned company shall acquire immovable property by way of purchase, gift, pawn, exchange or transfer.
Section 5 of TIPRL: No person shall grant a lease of immovable property, for a term exceeding one year: (a) To a foreigner or foreigner owned company. (b) No foreigner or foreigner owned company shall receive a lease of immovable property, for a term exceeding one year.
Despite these provisions, the relevant Ministry may allow exemptions to a foreign government for the use of its diplomatic mission accredited to Myanmar or to United Nations’ organizations or to any other organizations of individuals.
Condominium Law, 2016
Basically, foreigners are not allowed to own immovable properties such as land and building in Myanmar under the TIPRL. However, foreigners may own up to 40% of the condominium registered under the Condominium Law, 2016 (“CL”) and they may legally transfer, lease or mortgage their ownership rights.
The CL defines the condominium as a high-rise building which is constructed over 6 floors on the collective land registered under this Law as a collectively owned building. In addition, the land area which may be registered as collectively owned land for the purpose of constructing the condominium must be at least above 20,000 square feet. A foreigner who owns a unit of the condominium has the right to transfer, lease and mortgage his/her ownership right under the CL.
Land Use Right of Foreign Investors
As mentioned earlier, foreign companies or foreign individuals may not obtain ownership right on immoveable properties. Also, they may only lease the land for a term not exceeding one year subject to the TIPRL. This may lead to the obstacles for foreign investors who wish to use the land for a long-term. Nonetheless, there is a way that they may use the land for a long-term under the Myanmar Investment Law, 2016 (“MIL”). Obtaining Myanmar Investment Commission (MIC) Permit or MIC endorsements causes the long-term land use right for foreign investors.
According to the MIL, any investor who obtains MIC permit or endorsement has the right to obtain a long-term lease of land for a term (50) years which may extend to two consecutive (10) years. Therefore, foreign investors desirous of leasing the land for a long-term need to apply for MIC permit or endorsement in accord with the provisions of the MIL.
Special Economic Zone Law, 2014
When it comes to land use right of foreign investors in special economic zones, they have the right to lease the land for a term up to 50 years, which may be extended to 25 years by paying fees for the land use to the Management Committee formed under the Special Economic Zone Law. Furthermore, they are entitled to sell, mortgage, lease, exchange or give the right to use land and buildings within the permitted period to carry out businesses with the approval of the Management Committee.