YANGON - Myanmar's parliament has rejected a proposal to limit foreign ownership of businesses in certain sectors to 49 per cent, voting to confirm a limit of 80 per cent set in January under a new investment law approved last November, official media said.
The decision, taken on Monday, will cover investment in sectors deemed sensitive, including agriculture and businesses that could affect the environment, the Myanma Alin daily reported on Tuesday.
In other sectors, foreign firms will be able to set up ventures without the need for a local partner.
The law was held up in the legislative process for much of last year, caught between a government eager to attract foreign investment, influential domestic tycoons trying to protect their monopolies and small businesses keen not to be shut out.
Investors see huge opportunities in a country that was largely closed to foreign firms until President Thein Sein took office in March 2011 at the head of a quasi-civilian government, ending almost half a century of military rule.
Among the changes under the new law, foreign investors can lease land from the government or from authorised private owners for up to 50 years, and the deal can be extended twice, for 10 years each time.
The old law did not define lease periods but in practice contracts tended to cover 30-year terms, extendable for two periods of five years.
Foreign firms may be entitled to a tax holiday for the first five years of operation and other forms of tax relief may be available depending on the investment, if deemed in the national interest. The old law allowed for a three-year holiday.
The old law stressed export promotion but the new one states that output can be used for "both export promotion and import substitution".
It supersedes an investment law dating from November 1988. Foreign firms set up under the old law are now governed by the new legislation.