As some of our clients and readers may already be aware, DICA has recently tightened up its requirements for providing recommendation letters in support of visa renewals for resident foreign employees of DICA-incorporated companies. A list of the revised requirements is currently going around in some circles on social media. We understand from conversations with DICA that an announcement regarding the changes will be made on its website soon (if not already done by the time of publishing this note).
Most of the updated requirements are arguably reasonable in general in respect of permission for foreign employees to undertake work. In our view, part of the tension around these type of conditions in Myanmar arises from the continuing lack of a proper foreign work permit system. That is, the new requirements would be largely reasonable for obtaining a work permit that is either ongoing or only subject to renewal every few years; but the requirements are somewhat onerous when imposed annually (or potentially six-monthly) in relation to visa renewals.
Main points from the new list
The main points to note from the new requirements are:
Companies can only apply for DICA recommendation letters in support of foreign employee visas after having been incorporated for at least one year.
Companies that have been suspended in the DICA/MyCO company registry for failure to file an Annual Return on time will not be eligible to apply for DICA recommendation letters until they have had their suspension removed and remained compliant with Annual Return filing requirements for the following one year.
Companies must apply for DICA recommendation letters between 90 and 120 days prior to the expiry of the relevant foreign employee’s then-current visa.
A “proclamation” of the company’s board of directors regarding the foreign employee is required. It is not quite clear what this means – presumably a board resolution confirming the employment.
It appears that companies that have been operating for several years may be required to provide several years’ worth of copies of tax returns/payment evidence in support of the application.
The employee’s CV, in a format to be provided by DICA, must be submitted in support of the application, along with the terms of reference or job description for the employee’s role.
As far as we understand it at the time of writing, the DICA recommendation letter requirements for foreigners applying as non-employee directors or shareholders of a company are unchanged. (However, it’s not clear whether the first two points above regarding the company being at least 12 months old and compliant with Annual Return filings for at least 12 months might still apply for director/shareholder visas).
Impact on start-ups
The revised requirements appear to potentially impact in particular on start-ups – as companies will not be able to apply for DICA visa recommendation letters until they have been incorporated for at least a year. This would appear to deny new companies access to foreign employees – which may have a significant impact on some start-ups. If so, it is somewhat disappointing to see DICA introducing policies that potentially inhibit new businesses, particularly in an economic environment where start-ups and new investments are at a low ebb.
Conclusion
Please feel free to contact us if you would like more information on, or assistance with, visa renewals for foreign employees or Annual Return filing and compliance issues.