Relevant Legislation

Labour Laws
Special Economic Zone Laws
Investment Laws
Land Laws

Labour Laws

Labour Organization Law 2011

The Labour Organization Law, which took effect in March 2012, gives Burmese workers the right to form labour unions and the right to strike and was drafted with the assistance of the International Labour Organization. This law allows for the formation of labour unions with a minimum of thirty members and establishes procedures for strikes, provided they do not hinder transport and security infrastructure. However, the right to collective bargaining is not recognized. Employers who breach regulations are liable to heavy penalties.

By May 2013 566 labour organizations were registered, of which 19 are employers’ organizations. The majority of workers’ organizations are at the basic labour organization level (enterprise level),with the exception of two seafarers’ federations established under the special provisions, and 14 township labour organizations, which are groupings of basic organizations by trade or activity at township level. The ILO notes that there are still concerns regarding harassment and dismissals of labour organization leaders by employers, and recommends the firm application of existing legal prohibitions against such behaviour.

Settlement of Labour Disputes Law 2012

The Settlement of Labour Disputes Law was enacted on 28 March 2012, which provides rules for the resolution of disputes through conciliation and arbitration, as well as regulating industrial action.

As an awareness of labour rights has increased, an increasing number of strikes have been held in 2012 and 2013. The International Confederation of Trade Unions reports that in 2013, the dispute resolution procedures were not always effective, as newly established arbitration councils do not yet have the tools necessary to enforce their decisions, in particular concerning reinstatement. ITUC also noted that agreements reached between employers and workers through the conciliation process were not consistently respected.

Minimum Wage Law 2012

The Minimum Wage Law was passed on 22 March 2013 and entered into force on 4 June 2013. The law stipulates the creation of a National Committee to set minimum wage levels for different sectors, including workers in special economic zones, and highlights the responsibilities of employers and the rights of workers. Employers must pay the minimum wage as dictated by the Committee well as informing employees of the prevailing minimum wage. Employees, regardless of gender, have the right to be treated and compensated equally.

As of November 2013, the minimum wage has not yet been determined. A survey of factory workers in Yangon carried out in November 2013 indicates that the majority of workers are receiving very low wages which are considerably lower than wages elsewhere in the region.

Special Economic Zone Laws

Burma is currently in the process of establishing three SEZs:

– Thilawa SEZ, near Yangon: to be jointly developed by a consortium of three Japanese companies (Mitsubishi, Marubeni and Sumitomo) together with the Thilawa SEZ Development Public Company (MTSDPC), consisting of 9 Burma public companies. Construction began on 30 November 2013 and is planned for completion in 2015.

– Dawei SEZ, located in Tanintharyi Division in the south of Burma. Plans for Dawei include a deep-sea port and links to oil and gas pipelines, as well as a motorway linked to Thailand’s Kanchaburi province and a railroad hub. Dawei SEZ is a 50-50 joint project shared between Burma and Thailand who are currently seeking new investors following the failure of Italian-Thai Development, the sole developer, to secure investment partners.

– Kyauk Phyu SEZ is situated on Yanbyae Island off Rakhine State in the south-west of Burma and is specifically aimed at exporting goods and natural resources to China. The project is being implemented between China’s CITIC Group and Burma’s state-owned Myanmar Oil and Gas Enterprise. The construction of the oil and gas terminal and tanker port is underway while the development of SEZ itself is expected to begin in 2014.

In January 2011 a Special Economic Zones Law and a law for the Dawei SEZ were enacted under the previous military government. These laws have been substantially revised by the current government. Set Aung, deputy minister of national planning and economic development and vice governor of the Myanmar Central Bank reported in October 2013 that a new SEZ law will be enacted in the near future. Foreign Investors investing in the SEZs receive a licence directly from the one stop service centre established in each SEZ. Foreign investment outside these zones is governed by the foreign investment law.

Investment Laws

Foreign Investment Law 2012

The Foreign Investment Law came into force on 2 November 2012. The bill, which had originally restricted foreign investors to a 49% investment in joint ventures with Burmese partners, was finally passed with no cap stipulated for unrestricted sectors. Regulations passed in March 2013 provide that foreigners may invest up to 80% in joint ventures with Burmese partners in restricted sectors, namely natural resources and the environment; agriculture, livestock, and fisheries; manufacturing and services operations that Burmese “are capable of handling”; and industries that could “affect public health” such as those dealing with toxic waste.

The Foreign Investment Law stipulates that only Burmese citizens be employed in unskilled jobs. In areas which require a special skill, at least 25% of the employees must be Burmese for the initial two years of operations, 50% for the subsequent two years, and 75% for the third period of two years. Foreign employers are also required to train local employees and develop their range of skills.

Citizens Investment Law 2013

On 29 July 2013 a new Myanmar Citizens Investment Law was issued which follows the provisions of the Foreign Investment Law by allowing citizens to apply to undertake any business not specifically outlawed, instead of limiting permits to the specific economic activities prescribed by the Myanmar Citizens Investment Commission (now assimilated into the Myanmar Investment Commission). This law also provides a 5 year income tax holiday, the same period as for businesses under the Foreign Investment Law.

Land Laws

Under the 2008 Myanmar Constitution, the state is the ultimate owner of all land. The Farmland Law and the Vacant, Fallow and Virgin Lands Management Law, enacted on 30 March 2012 were intended to clarify land use rights but in fact operate to encourage large scale agricultural investment without providing adequate tenure security for smallholder farmers and protection from dispossession of their land.

The Farmland Law establishes a system of securing rural land tenure through registration which creates private use rights including the right to lease, sell and inherit. The Vacant, Fallow, and Virgin Land Management Law provides that public citizens, private sector investors, government entities and NGOs may submit an application to lease unused land for agriculture developments, mining, and other purposes allowed by law.

These land laws have been widely-criticised by civil society groups for, amongst others, failing to take into account the lack of ownership documents among farmers, the likelihood that large numbers of people may be unaware that they can register their land , for overall bias against low-income groups in favour of commercial interests, and for facilitating “land grabbing”.

In June 2012 a parliamentary committee (the Pyithu Hluttaw’s Reform and Development Monitoring Committee) announced that amendments would be made to the laws in light of increasing landlessness among farmers. Following a conference organised in August 2013 by the 88 Generation student group’s farmers’ committee, farmers have drawn up a list of 17 demands to be incorporated into any legislative amendments. These include bringing an end to the arrest of farmers protesting in cases of land disputes, fair investigation of farmers’ claims, and direct compensation for lost land rather than compassionate aid.

 

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