Business Advisory for Burma

On February 1, 2021, Burma’s military overthrew the country’s democratically-elected civilian government in a coup d’etat. Since then, the military has killed more than 1,400 innocent people, unjustly arrested political leaders and journalists, violently disbanded labor unions, and committed egregious human rights abuses against the people of Burma. These acts are an attack on the people of Burma and a rejection of their will, as expressed in Burma’s November 2020 general elections.

The coup and subsequent military-led abuses have severely damaged Burma’s economic and business environment, reversing the gains achieved over the course of Burma’s ten-year transition towards democracy, and resulting in an unpredictable business environment in which the military extracts revenue to support its violent repression of democracy.

On January 26, 2022, the U.S. Departments State, Commerce, Homeland Security, Labor, the Treasury, and the Office of the U.S. Trade Representative are issuing this advisory to inform individuals, businesses, financial institutions, and other persons — including investors, consultants, and research service providers — of the heightened risks associated with doing business in Burma, and particularly business activity that could benefit the Burmese military regime.

The United States does not seek to curtail legitimate business and responsible investment in Burma. However, businesses and individuals should be wary of the associated illicit finance and money laundering risks, as well as reputational and legal risks, of conducting business and utilizing supply chains under military control in Burma. The military regime has undermined the rule of law, facilitated widespread corruption, and committed serious human rights abuses, which exacerbate risks to foreign businesses operating in Burma or providing financial services to Burmese businesses.

These industries have been identified as primary industries providing economic resources for Burma’s military regime:

• State-owned enterprises
• Gems and precious metals
• Real-estate and construction projects
• Arms, military equipment, and related activity

Businesses and individuals with potential exposure to, or involvement in, operations or supply chains tied to the military regime that do not conduct appropriate due diligence run the risk of engaging in conduct that may expose them to significant reputational, financial, and legal risks, including violations of U.S. anti-money laundering laws and sanctions, as well as abetting human rights abuses.

This business advisory is another example of the United States’ strong commitment to the people of Burma. The United States will continue to work with our partners and allies to promote justice for victims and accountability for those responsible for human rights abuses and atrocities, and to press the regime to cease the violence, release all those unjustly detained, cease human rights abuses, and restore multiparty democracy and Burma’s democratic transition. Read the full business advisory here: https://www.state.gov/risks-and-considerations-for-businesses-and-individuals-with-exposure-to-entities-responsible-for-undermining-democratic-processes-facilitating-corruption-and-committing-human-rights-abuses-in-burma/

The United States Takes Further Actions against the Burmese Military Regime

On July 2, 2021, in response to the brutal campaign of violence perpetrated by the Burmese military regime and to continue imposing costs in connection with the military coup, the U.S. Department of the Treasury’s Office of Assets Control designated 22 individuals connected to the regime, pursuant to Executive Order 14014 “Blocking Property With Respect to the Situation in Burma.” These include three additional State Administration Council (SAC) members and four military-appointed cabinet members, as well as 15 adult children or spouses of previously designated Burmese military officials whose financial networks have contributed to military officials’ ill-gotten gains.

In addition, the U.S. Department of Commerce is adding Wanbao Mining, Ltd., two of its subsidiaries, and King Royal Technologies to its Entity List. These entities provide revenue and/or other support to the Burmese military, and Wanbao Mining and its subsidiaries have long been implicated in labor rights violations and human rights abuses, including at the Letpadaung copper mine. For more information about these actions, see Treasury’s press release and Commerce’s press.

G7 Foreign Ministers' Statement on Burma

On February 23, 2021, the G7 Foreign Ministers of Canada, France, Germany, Italy, Japan, the United Kingdom and the United States of America and the High Representative of the European Union firmly condemn violence committed by Myanmar's security forces against peaceful protests, and offered condolences for the loss of life.

“We condemn the intimidation and oppression of those opposing the coup. We raise our concern at the crackdown on freedom of expression, including through the internet blackout and draconian changes to the law that repress free speech. The systematic targeting of protesters, doctors, civil society and journalists must stop and the state of emergency must be revoked. We continue to call for full humanitarian access to support the most vulnerable.”

“We remain united in condemning the coup in Myanmar. We call again for the immediate and unconditional release of those detained arbitrarily, including State Counsellor Aung San Suu Kyi and President Win Myint and continue to stand with the people of Myanmar in their quest for democracy and freedom.”

Condemning the coup in Myanmar: G7 Foreign Ministers' statement

The G7 Foreign Ministers of Canada, France, Germany, Italy, Japan, the United Kingdom and the United States of America and the High Representative of the European Union, are united in condemning the coup in Myanmar.

“We are deeply concerned by the detention of political leaders and civil society activists, including State Counsellor Aung San Suu Kyi and President Win Myint, and targeting of the media. We call upon the military to immediately end the state of emergency, restore power to the democratically-elected government, to release all those unjustly detained and to respect human rights and the rule of law. The November election results must be respected and Parliament should be convened at the earliest opportunity.

“The military’s restrictions on information flows are deeply concerning. Civilians, including civil society and the media, must not be subject to reprisals in any form. We also call for unrestricted humanitarian access to support the most vulnerable.

“G7 Foreign Ministers recall their 2019 communique in which we restated our commitment to Myanmar’s democratic transition, peace and accountability for human rights violations and abuses.

“We stand with the people of Myanmar who want to see a democratic future.”

Agathon Associates has followed developments in U.S. trade with Myanmar, also called Burma, for many years.

In 2013 the U.S. lifted the ban on imports from Burma, and in 2016 extended GSP benefits to Burma (GSP, or Generalized System of Preferences, is a program that provides for duty-free entry for certain articles from developing nations.

More information about Burma is available at this Congression Research Service report.

Burma Okay'd for GSP Benefits

On September 16, 2016, the Executive Office of the President published in the Federal Register Proclamation 9492 of September 14, 2016 To Modify Duty-Free Treatment Under the Generalized System of Preferences. Thus adding Burma to the list of GSP eligible nations.

Meeting Convened by Ambassador Froman to Build International Support for the Myanmar Initiative to Promote Fundamental Labor Rights and Practices

On October 10, 2014, U.S. Trade Representative Michael Froman brought together representatives of the U.S. government, Myanmar and other international governments, the International Labor Organization, the World Bank, and the International Finance Corporation to help build support for a joint U.S.-Myanmar (Burma) initiative to improve labor conditions in Myanmar. The labor initiative was announced during Ambassador Froman's visit to Myanmar, the first by a U.S. Trade Representative, in August.

Participants in the meetings at USTR included representatives from the United States, Myanmar, Australia, the European Commission, Japan, the Netherlands, Norway and Sweden. The International Labor Organization, World Bank, and International Finance Corporation also took part. In addition to Ambassador Froman, additional U.S. agency representatives from the Department of State, the U.S. Agency for International Development, the Department of Labor, and the Department of the Treasury participated in the meeting.

Prior to November 16, 2012, the U.S. had, since 1997, under Executive Order 13047, and since 2003 under the Burmese Freedom and Democracy Act of 2003 and Executive Order 13310, the United States had banned the importation of products of Burma.

U.S. Lifts Ban on Imports from Burma

Wednesday, in light of the July 28 expiration of the Burmese Freedom and Democracy Act's ("BFDA") ban on imports from Burma, President Barack Obama issued an Executive Order that repeals the provisions of Executive Order 13310 that implemented the broad BFDA import ban on products of Burma.