The Myanmar parliament enacted the Telecommunications Law No. 31/2013 (the Telecoms Law) on 8 October 2013, providing much-needed regulatory reforms to the telecommunications sector. With this enactment, the Telecoms Law also repealed the Myanmar Telegraph Act 1885 and the Myanmar Wireless Telegraph Act 1934.
The Telecoms Law provides a high-level regulatory framework for telecommunication services such as network facility services, network service providers and application service providers. The Telecoms Law is supplemented by Notification No. 16/2014 dated 14 October 2014 (the Licensing Rules) issued by the then Ministry of Communications and Information Technology of the Union Government (MCIT), which introduces rules and regulations in respect of licensing as well as the implementing regulations to the Telecoms Law. In 2015, Notification No. 1/2015 (the Interconnection and Access Rules) was issued by the MCIT on 6 January 2015, Notification No. 21/2015 (the Telecoms Competition Rules) was issued on 9 June 2015, Notification No. 49/2015 (the Numbering Rules) was issued on 3 December 2015, and followed by Notification No. 10/2016 (the Spectrum Rules) on 7 March 2016. Since the 2015 general elections and change in government in Myanmar on 1 April 2016, the MCIT has been reorganised into the Ministry of Transport and Communications (MOTC) by way of Notification No. 9/2016 issued on 25 May 2016. Since then, the MOTC has issued several guidelines and notifications including the Technical Specifications for Short Range Device notice on 17 July 2016, the Guidelines on the Provision of International Gateway Services on 8 September 2016, the Telecommunications Numbering Plan on 31 January 2017 (Numbering Plan), and the Technical Specification and Quality of Service for International Gateway Service on 5 April 2017. In addition, the MOTC has launched a public consultation for the draft Myanmar Communications Regulatory Commission Law (the MCRC Law) on 15 May 2017. On 18 August 2017, the Myanmar Parliament adopted minor amendments to the Telecoms Law. The amended Telecoms Law allows judges to grant bail, narrows the locus standi to file claims by prohibiting third parties from filing cases under the amended Telecoms Law, unless they are directly affected or acting on an affected individual’s behalf, and lowers the maximum prison sentence from three years to two years for offences under Section 66 of the Telecoms Law (which relate to the misuse of telecommunication networks).
The main regulator for the communications sector in Myanmar is currently the Posts and Telecommunications Department under the MOTC (the Department). In the past, the Department was both the regulator and the sole monopoly operator in the telecommunications market. However, the two roles have now been split, with the Department acting as the telecommunications regulator and Myanmar Posts and Telecommunications (MPT) serving as the primary state-owned telecommunications operator. However, the Department and MPT are not completely independent from one another as both operate under the MOTC.
The responsibilities of the Department include the issuance and renewal of service provider licences, regulation of the frequency spectrum and numbering plans, ensuring consumer protection, inspection and supervision of service providers as well as instituting administrative actions against service providers. Certain functions of the Department, such as issuance of licences to foreign entities, must be approved by the MOTC. However, we understand from the draft MCRC Law that the MCRC is expected to take over these functions of the Department, in addition to other functions, such as advising the government on communications policies, promoting fair competition and assisting the Competition Commission with investigations into complaints regarding market conduct in the telecommunications sector. It is unclear whether the Department will remain once the MCRC takes over such functions.
Pursuant to the Telecoms Law, the National Telecommunications Advisory Committee will be formed by the MOTC to, inter alia, make recommendations on technical standards, consumer protection and strategic development of the telecommunications sector in Myanmar, although it is not established to date. In addition, the Communication Appellate Tribunal (the Appeal Tribunal) will be established to hear administrative appeals against the MOTC’s decisions.
Laws concerning the regulation of the internet include the Wide Area Network Order (Notification No. 3/2002), the Computer Science Development Law 1996 (CSDL) and the Electronic Transactions Law 2004, which was amended in 2014. It was reported that, in the near future, the Myanmar government will look to formulate cross-sector policies in specific areas such as cybersecurity, data protection and spam control as the infocommunications and technology sectors in Myanmar continue their current pace of development. Existing laws may also be amended or replaced if they are outdated or inconsistent with recent legislation. For example, the CSDL provides that the establishment or connection of a computer network without the prior approval of the MOTC is punishable with an imprisonment term of between seven and 15 years.
General investment regime
From a general investment perspective, Notification No. 13/2017 (Classification of Promoted Sector) issued by the Myanmar Investment Commission persuant to the Myanmar Investment Law 2016 grants income tax exemptions to investors which manufacture telecommunications equipment, install telecommunication lines, construct telecommunication towers, undertake businesses related to regional fibre lines and provide telecommunication services. The period of income tax exemption will depend on the location of the investor’s operations in Myanmar.
Foreign entities are permitted to apply for licences under the Telecoms Law. The Licensing Rules define a foreign entity as a legal entity in which a non-Myanmar citizen or foreign incorporated entity is holding a controlling interest, whether directly or indirectly, of more than 50 per cent of the voting stock, membership interest or general partnership interest in the entity. This definition differs from the more expansive definition commonly relied on under the Myanmar Companies Act 1914, which defines a foreign company as any company with at least one foreign shareholder.
To date, four nationwide telecommunications licences have been issued, two of which were awarded to foreign operators: Ooredoo from Qatar and Telenor from Norway. The remaining two nationwide telecommunications licences were awarded to state-owned MPT and local internet service provider Myanmar National Tele & Communications Co, Ltd (MNTC). After an initial delay in the licensing process, the MCIT granted official nationwide telecommunications licences to both Ooredoo and Telenor on 30 January 2014. The licences came into effect on 5 February 2014 and currently remain valid for a duration of 15 years. According to a list of licensees available on the MOTC’s website dated 24 May 2017, MPT was issued its nationwide telecommunications licence on 24 March 2015, while the fourth nationwide telecommunications licence was issued most recently to the MNTC on 12 January 2017; both licences being valid for 15 years.
A list of licensees published by the MOTC on 24 May 2017 also showed that a number of service licences (defined below) have already been issued to companies including Shwe Than Lwin Media, Myanmar Tower Company, KDDI Summit Global, Yadanarpon Teleport and FPT. Most notably, Vietnamese technology company FPT was the first 100 per cent foreign-owned company among the list of licensees.
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