Land Use Rights

In principle, Myanmar law explicitly prohibits foreign-owned companies and foreign individuals from owning land and buildings in Myanmar. Further, a lease of immovable property is limited to only one year. Foreign investors, however, may apply to the Myanmar Investment Commission for the exemption from this general rule and be granted authorisation for long-term leases of up to 50 years with the possibility of two extensions of 10 years each. Further, foreign investors in Special Economic Zones are entitled to lease land for a period of up to 50 years, with the option to extend the lease for 25 years.

Ownership of Condominiums Units

Under Myanmar law foreigners and foreign-owned companies have the right to purchase up to 40% of units in condominiums in Myanmar. Implementing regulations clarifying the registration of development projects as “condominiums” and procedures related to the registration of condominium land and the purchasing of units are expected to be passed.

Taking Security over Property

Generally, security over immovable property needs to be registered with the government authorities in Myanmar.

The Transfer of Immovable Property Act of 1987 prohibits foreign-owned companies and foreign individuals from taking security over land and buildings in Myanmar. Therefore, in practice, some foreign lenders employ Myanmar banks to act as security agents, as unlike a foreign security holder, a Myanmar bank can take security over immovable property and enforce it.

Security interests over movable assets or contractual rights of companies incorporated in Myanmar need to be registered with the Directorate of Investment and Company Administration online.

Enforcement of Security Interest

Generally, enforcement of security interests in Myanmar requires court intervention. The exception is the enforcement of security interests over movable property: if the secured property was possessed by a security holder, court intervention is not necessary. Another exception is the enforcement of security interests over immovable property. It is possible without court intervention if a security holder possesses a property title.

Our legal advisers can assist with:

• drafting, reviewing and negotiating lease agreements, loan agreements and security documents;
• advising on land use rights and taking security over property in Myanmar; and
• applying for long-term land lease authorisations from government authorities.