You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

November 23, 2015

Tapping into Myanmar’s Franchising Potential

Subscribe to Updates
Informed Counsel

Franchising has become very popular among international franchisors in the Greater Mekong Subregion. In particular, franchising in Myanmar’s food and beverage sector has experienced tremendous growth, as the country’s middle class continues to expand and tourists maintain a steady influx into the region.

In Myanmar, global franchise companies such as KFC, Yakun Coffee & Toast, Swensen’s, Pizza Company, BBQ Chicken, and Lotteria, among many others, are already a common sight. Many of these global chains have even customized their menus and products to adapt to local preferences.

In this article, we examine the wealth of opportunities available by using the franchise model as a mode of business in Myanmar, as well as issues relating to trade, intellectual property, and emerging markets.

Investment Environment

The European Union and the United States continue to lift their sanctions on Myanmar, which has allowed more businesses to enter the Burmese market. In Myanmar, commercial relationships such as franchising, joint ventures, wholly foreign-owned enterprises, and distribution are primarily governed by the Foreign Investment Law, Foreign Investment Rules, Myanmar Companies Act, Contracts Act, and a range of notifications issued by different ministries.

Investment in the retail and food and beverage sectors can be made through a joint venture with local Myanmar corporate entities. There are no specific restrictions on share equity in joint ventures, and the Myanmar Investment Commission determines the ratio of share equity on a case-by-case basis.

The import, export, and sale of goods are almost exclusively reserved for local Myanmar citizens or 100 percent locally-owned Myanmar companies. Such trading may be afforded to large foreign businesses operating in special economic zones under the Special Economic Zones Law.

However, if a franchise outlet in Myanmar is owned by a foreign-owned subsidiary, it can engage in trading, including the import and sale of franchise products through the outlet, with the assistance of a local company or an individual. Franchising can therefore help overcome the current restrictions on foreigners operating in the Burmese market.

Competition

Exclusivity clauses are common to franchise relationships. In Section 27 of Myanmar’s Contracts Act, however, it states that “every agreement by which any one is restrained from exercising a lawful profession, trade, or business of any kind, is to that extent void.” This would appear to prohibit the inclusion of an exclusivity clause in a franchise relationship.

In fact, the restriction imposed by Section 27 is not absolute, provided that the exclusivity clause is carefully worded to restrict such negative covenants to a specific type of business, term, and geographical area.

Although Myanmar’s Competition Law was passed in February this year, it has not been fully implemented, as the bylaws have not yet been issued. However, as the country’s economic climate is still maturing, franchising businesses are unlikely to raise any competition issues.

Advertising restrictions, such as comparative advertising of businesses with similar goods and services, dissemination of incorrect information, and deceptive advertising about a given product, are expressly prohibited under the Competition Law.

Intellectual Property Protection

There is no legal or regulatory framework for intellectual property (IP) in Myanmar, but the country’s IP laws are currently being drafted. There are several provisions in the Code of Civil Procedure that deal with trademark infringement, such as passing off, which is a false representation that induces a person to believe that the goods and services of an owner are those of another.

In the absence of IP laws, it is important for brand owners to generate as much public awareness of their IP as possible. Filing and registering a declaration of ownership with the Registry of Deeds and Assurances is highly recommended, followed by publishing a cautionary notice to reserve any IP rights and to serve as evidence of such rights if the need arises. This includes filing trademark license agreements with the Registry, and if the Trademark Law is enacted, it would become compulsory to register trademark license agreements as well.

Pitfalls

While there is great optimism in Myanmar, it is important to be mindful of the challenges in developing jurisdictions. For example, the Arbitration Law has not yet been enacted, which has delayed Myanmar’s ratification of its obligations under the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

Resolution of disputes through Myanmar’s court system is highly protracted and generally avoided by the business community as the legal system has redundant, archaic laws that are ill-suited to modern business relationships.

Conclusion

The opportunities in Myanmar are endless, and the country’s outlook is very positive. Consumer spending is increasing as average incomes continue to rise, Myanmar’s developing telecommunications infrastructure has resulted in greater brand recognition among the populous, and the government has shown a strong commitment toward implementing economic and political reforms. Franchising will play a crucial role in Myanmar’s continued development, as it generates jobs, enhances skill development, and grows small and medium-sized businesses. It has therefore been no surprise that international franchisors have scrambled to the country for a piece of the pie.

Download Full Article
Related Professionals

Practices

Corporate/M&A

Intellectual Property

Location

RELATED INSIGHTS​ 

August 20, 2026
Vietnam’s Law on Bankruptcy and Rehabilitation No. 142/2025/QH15, passed by the National Assembly on December 11, 2025, does something many regional counterparts do not yet attempt: it instructs parties and arbitral tribunals on exactly what happens to an arbitration once a debtor becomes insolvent. Together with the Law on Commercial Arbitration No. 54/2010/QH12, the new law improves upon what used to be an uncertain area of practice, now providing an explicit, mandatory sequence of procedures. Suspension and Termination of Arbitration Proceedings Under article 40(2) of the law, once a Vietnamese court accepts a bankruptcy petition, any arbitration that concerns the debtor’s financial obligations must be temporarily suspended as soon as the tribunal receives the court’s notification. If the court subsequently issues a decision commencing bankruptcy proceedings, article 59(2) takes a further step: the suspended arbitration is terminated outright, and the underlying case file is transferred to the court handling the insolvency for resolution. The two provisions work as a sequence: first suspension, then termination and transfer, rather than as independent triggers. Meanwhile, article 60(4) reinforces this effect by vesting the bankruptcy court with exclusive jurisdiction over all claims against the debtor from the date the petition is accepted. Notably, this mechanism operates automatically, without the need for the insolvency court to issue a separate anti-arbitration order. The tribunal simply suspends or terminates the proceeding by operation of law once notified; however, Vietnamese law currently provides no procedure by which a party can apply to the insolvency court for permission to continue the arbitration despite the statutory effect. Practitioners with a Vietnamese counterparty in arbitration should treat notification of a bankruptcy filing as something to flag to the tribunal immediately since continuing to arbitrate a claim that has become subject to article 40(2) or 59(2) risks producing an award vulnerable
Read More
August 20, 2026
Thai law contains no provision that speaks directly to what happens to an arbitration when one of the parties becomes insolvent. The interaction between arbitration and insolvency is derived instead from the general operation of two separately drafted laws: the Bankruptcy Act B.E. 2483 (1940) and the Arbitration Act B.E. 2545 (2002). Because Thai courts have had few opportunities to interpret how these two statutes apply together, the practical answer to many questions, such as who represents an insolvent party in arbitration, whether an award will be enforced, and what happens to a foreign proceeding, depends on inference from general principles of insolvency, arbitration, and procedural law rather than on settled rules. Liquidation and Restructuring The Bankruptcy Act governs both liquidation, which winds up a debtor’s affairs, and restructuring (rehabilitation), which aims to preserve a business. The consequences for arbitration differ accordingly. In liquidation, the debtor’s assets vest in the official receiver, who alone can conduct or continue any arbitration affecting the estate; the debtor loses the authority to act on its own behalf. In restructuring, the plan preparer or administrator takes over that role, but there is more room for the debtor to remain involved, since the objective of rehabilitation is to keep the business operational. Restructuring carries an automatic stay that takes effect once the Bankruptcy Court accepts the restructuring petition. This stay can halt an arbitration regardless of where it is seated. In contrast, liquidation does not work through a stay; instead, the debtor’s loss of authority over its own assets and disputes is what constrains the arbitration. Neither proceeding provides a party a formal route to apply for permission to continue arbitrating—the Bankruptcy Act contains no such mechanism—though in restructuring cases the Bankruptcy Court may allow proceedings to continue where doing so will not prejudice
Read More
August 20, 2026
As part of its membership in Lex Mundi, Tilleke & Gibbins has released the latest edition of its Guide to Doing Business in Thailand, providing an overview of the legal, regulatory, and commercial considerations for companies establishing or expanding operations in Thailand. The 2026 edition offers practical insight into the country’s business environment, investment framework, and operational requirements. The guide covers a wide range of topics relevant to foreign and domestic investors, including: Investment incentives and promotion schemes Financial facilities and banking regulations Exchange controls and money transfers Import and export regulations Business structures and incorporation options Requirements for establishing a business Operational and compliance considerations Business cessation and insolvency procedures Employment and labor laws Taxation Immigration and visa requirements Prepared by Tilleke & Gibbins lawyers across multiple practice areas, the publication outlines key aspects of doing business in Thailand, including foreign investment restrictions, regulatory compliance obligations, corporate structures, employment requirements, and recent legal and economic developments affecting investors. The publication forms part of Lex Mundi’s Country Guides series, a global collection of jurisdiction-specific reference materials prepared by member firms around the world. Together, these guides help companies evaluate opportunities, compare regulatory environments, and plan international business activities across multiple markets. The full Guide to Doing Business in Thailand 2026 is available through the button below.
Read More
August 18, 2026
The Bank of Thailand (BOT) is seeking public comment on proposed amendments that would significantly expand know-your-customer (KYC) and customer due diligence (CDD) requirements for cash-related transactions at financial institutions (FIs) and specialized financial institutions (SFIs). Released on August 5, 2026, the proposed regulation would supersede BOT Notification No. 16/2569, which focused primarily on cash withdrawal transactions. The public comment period is open through September 3, 2026. The amendments reflect concerns that FIs and SFIs may be used to facilitate the movement, concealment, and conversion of criminal proceeds, potentially damaging institutional operations and public confidence in the financial system. Expanded Scope of Covered Transactions The most significant change is the broadening of the definition of “cash-related transactions.” Previously, the regulation covered only cash withdrawals and uncrossed check withdrawals. The amended regulation extends coverage to include: Cash deposits, check deposits, or receipt of funds from the public not in the form of deposit accounts; Thai baht (THB) banknote exchange (different denominations); Receipt of cash for issuing checks and drafts; and Purchase, sale, or exchange of foreign banknotes. Mandatory Identity Verification and Risk Management For all cash-related transactions, FIs and SFIs must require customers, or authorized or delegated persons, to present identification or verify their identity before every transaction, including one-time (walk-in) transactions. Specific identification requirements vary by transaction type, customer nationality, and channel (branch vs. electronic). FIs and SFIs must also establish comprehensive risk management processes and procedures for cash-related transactions. These requirements include identifying customers or authorized representatives in accordance with transaction-specific verification standards, analyzing customer behavior, implementing risk-management measures proportionate to the customer’s risk profile, and recording abnormal behavior in relevant systems. The BOT also encourages institutions to proactively guide customers toward transaction channels that offer greater traceability than cash. For corporate customers in high-risk business sectors—including foreign
Read More