MYANMAR Law and Practice Contributed by: Kana Manabe, Thit Thit Aung, Julian Barendse and Nirmalan Amirthanesan, Myanmar Legal Mori Hamada
11. Activism 11.1 Shareholder Activism
pany’s best interests. However, there has not been judicial scrutiny of these duties as yet. While obliga - tions regarding conflicts of interest also applied to directors under the former Myanmar Companies Act of 1914, this has not been the subject of judicial scru - tiny in Myanmar. 9. Defensive Measures 9.1 Hostile Tender Offers In practice, hostile tender offers are not possible in Myanmar. 9.2 Directors’ Use of Defensive Measures See 9.1 Hostile Tender Offers . 9.3 Common Defensive Measures See 9.1 Hostile Tender Offers . 9.4 Directors’ Duties See 9.1 Hostile Tender Offers . 9.5 Directors’ Ability to “Just Say No” See 9.1 Hostile Tender Offers . Litigation has not been common in Myanmar, includ - ing in connection with M&A deals, reflecting that Myanmar’s legal system – particularly in relation to sophisticated commercial disputes – is still developing its capacity. However, due to Myanmar’s economic circumstances, there has been an increase in disputes (including breach of contract disputes in relation to local contractors or other business partners of foreign investors, as well as well as employment redundancy disputes). 10.2 Stage of Deal The matter is not applicable in this jurisdiction. 10.3 “Broken-Deal” Disputes The matter is not applicable in this jurisdiction. 10. Litigation 10.1 Frequency of Litigation
Since the declaration of the state of emergency on 1 February 2021, strong activist pressure has continued to be applied on companies operating in Myanmar. The focus has been on companies with ties to Myan - mar’s armed forces; however, companies operating in Myanmar more broadly are also affected. This pres - sure has come from within the Myanmar community and the Myanmar diaspora, as well as from the wider international community. Pressure has been brought to bear through publicity campaigns, boycotts of products within Myanmar by distributors and consum - ers, and reports and open letters. 11.2 Aims of Activists The aim of activists is primarily to pressure companies with business ties to Myanmar’s armed forces to sever those ties, by, for example, withdrawing from supply or purchase arrangements or investments. However, as noted in 11.1 Shareholder Activism , this has also had a broader effect on companies that are operating in Myanmar. 11.3 Interference With Completion To date, activists have primarily targeted completed transactions. The primary goal of activists in Myanmar is to disrupt business dealings between third parties (including local and foreign investors) and the Myan - mar armed forces and affiliated entities.
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