Flow to start on legal wine imports

Wine importers are preparing for the restart of legal flows of foreign tipple after the government unveiled a procedure to allow imports.

The Ministry of Commerce issued a notification in mid-March that they will give permission on wine imports, and potential importers say they are now wading through the paperwork to allow them to begin legal imports for the first time.

“The change in policies depended on market demand and the increasing number of foreigners,” said ministry director general U Min Min.

Imports of wine and other alcohols have long been illegal, though authorities previously had largely turned a blind eye. This situation lasted until December 2013, when a crackdown began on importers using loopholes to bring liquor into the country.

The Ministry of Commerce promised to legalise alcohol imports, though after more than a year passed with no new rules, some prominent firms pulled all foreign alcohol from their shelves early in 2015.

While wine is the first to be allowed in by the ministry, it has plans to adjust its policies for other kinds of alcohol in the future based on market demand – though as yet no official notice on other forms of alcohol has been released.

U Min Min said wine carries with it a certain social cachet, which led to it being the first liquor to be legally allowed in.

“As wine is a symbol at formal and informal events, and while ASEAN countries allow the products in officially, and it’s tough to get high-quality, locally produced wine. These are the main reasons to lessen the restrictions,” he said.

Importers must have company registration, trading licences and an official deal with the company from which they are importing, said U Min Min.

Imports must first apply for an import licence, then ink contracts with foreign wine suppliers, before applying for licences from the Ministry of Commerce General Administration Department.

Hotels and duty-free shops enjoy a loophole allowing them to import wine. This has been kept going under recommendation from the Ministry of Hotels and Tourism, but supply from the hotels and duty free shops is not large enough to meet the growing market demand.

U Min Min said the new requirements are aimed at making sure importers pay proper taxes as well as preventing illegal trade.

A statement from business association UMFCCI on March 23 said wine importers must make sure each bottle has the proper label proving taxes are paid, that the ingredients are listed in English, that the wine is imported only by air or sea, and the labels showing the country of origin.

The government is expected to set up further policies on wine imports and consumption such as only allow certain qualities and limiting imported wine’s age, the statement said.

The Ministry of Commerce has not yet approved applications for importers, as the firms are still preparing their documents to begin legal imports, according to ministry Trade Promotion Department director U Win Myint.

“They need to have sufficient documents and registration for their official imports,” he said.

Retailers yesterday said they welcomed the new policies.

The importing rules will not be too difficult for importers or local retailers over the short term, though the issue of tax labels may be a problem, said U Aung Naing Myint, executive officer from the Myanmar Retailers Association.

The associations has heard feedback that it can be difficult to obtain some tax labels from the Internal Revenue Department. The labels are affixed over the cap or top of a wine bottle, ideally so it must be broken when the wine bottle is opened and cannot be re-used.

The quantity of the labels must be assured, he said.

“If they can’t get ensure a supply a labels to the importers, importers will not be able to distribute wine to the market even though the wine has been legally imported,” he said.

While legally imported products will obviously be more expensive than unofficial imports, as official imports are paying taxes and other fees, customers will be assured the products they are purchasing are genuine, said U Aung Naing Myint.

The Union Tax Law for the 2015-16 fiscal year has raised the commercial tax on wine to 60pc from 50pc starting April 1.

Daw Hla Hla Min, general manager of Mingalar Thiri Hotel in Nay Pyi Taw, said she welcomed the ministry’s move, adding it is a good sign for the catering industry and customers, as hotels currently face complaints from customers if they are unable to produce supply.

“We can provide an assortment of items, as much as customers want for official imports, but I think it will be a little pricey because of the taxes,” she said.

City Mart, the country’s most prominent supermarket chain, is preparing to follow the new regulations for wine imports according to the Ministry of Commerce’s announcement, marketing director Daw May Zin Soe Htet said.

“I don’t know the reality of the difficulties in following the regulations as this is still a very early stage,” she said.

“We are still preparing for the licence requirements, and we have not yet applied to officially begin wine imports.”

Source: Myanmar Times

NB: The best way to find information on this website is to key in your search terms into the Search Box in the top right corner of this web page. E.g. of search terms would be “property research report”, ”condominium law”, "Dagon City", “MOGE”, “yangon stock exchange”,"MECTEL", "hydropower", etc.

To learn about the business opportunities in Myanmar click here

To evaluate the various segments of the market that you could possibly enter base on your competencies you can do a Custom Market Entry Strategy Research. You can see a sample report at page "Actual Sample of Client Report”. Click here to go to page.

Do you know that IE Singapore is giving up to SGD 20,000 support for Singapore company to venture into Myanmar? To learn more click here