MYANMAR: Central Bank Imposes Stringent Compliance Requirements on Foreign Employees in Banks

Background

The Central Bank of Myanmar (CBM) has issued a statement outlining strict compliance requirements for banks to appoint foreign employees, including advisers. The move aims to ensure the sustainable operation of banks when foreign employees resign or terminate their employment.

Key Requirements

Under the new regulations, banks must seek CBM’s approval before recruiting foreign employees to prevent disruption to business operations. The Statement repeals an earlier announcement by CBM on May 20, 2020, and takes effect from August 2, 2021.

The regulations apply to all licensed commercial banks, development banks, and foreign bank branches operating in Myanmar. Key positions that can be held by foreigners include:

Chief Executive Officer (CEO)
Head of Department (HOD)
Director

subject to certain conditions.

Banks must also ensure that the number of foreign employees does not exceed market share limits:

Large banks: maximum of 25 foreign employees
Medium-sized banks: up to 15 foreign employees
Small banks: limited to 8 foreign employees

The CBM will grant approval on a case-by-case basis for foreign directors appointed due to equity participation.

Documentation Requirements

To comply with the regulations, banks must submit documents such as:

Draft employment contracts
Curriculum vitae
Recommendation letters from previous employers

Foreign employees are also required to provide an undertaking letter stating they have not been involved in political or criminal activities and are not blacklisted.

Obligations for Foreign Employees

Foreign employees working in Myanmar are obligated to abide by local laws and conduct themselves properly. Banks are responsible for ensuring their foreign employees respect and comply with existing laws in the country.

Consequences of Non-Compliance

Failure to comply with the regulations may result in administrative penalties, including:

Warnings
Fines
Restrictions on bank operations

The CBM will closely monitor banks’ compliance and impose penalties accordingly.

Advice for Clients

ZICO Law Myanmar advises clients to carefully review the Statement and seek legal advice to ensure compliance with the new regulations. For assistance with data protection and privacy matters in Myanmar, please contact Thuzar Tin or your usual ZICO Law Myanmar partner.