Practice Area: Banking & Finance | Anti-Money Laundering (AML) | Regulatory Compliance

ANTI-MONEY LAUNDERING LAW (2026)

On March 11, 2026, the National Defense and Security Council enacted the Anti-Money Laundering Law, 2026 (Law No. 16/2026) (“AML 2026”). AML 2026 primarily regulates “Reporting Organizations”, which encompass banks, non-bank financial institutions, and designated non-financial businesses and professions. Although its primary obligations apply to Reporting Organizations, the enhanced customer due diligence (CDD), beneficial ownership verification, and transaction monitoring requirements are expected to have significant practical implications for businesses that rely on the banking system for domestic and international commercial transactions. Additionally, the law also imposes direct obligations on individuals and entities transporting cash, bearer negotiable instruments, precious metals, or precious stones across Myanmar’s borders where the prescribed declaration thresholds are met.

EVOLUTION OF THE ANTI-MONEY LAUNDERING LEGAL FRAMEWORK IN MYANMAR

The regulatory landscape governing financial compliance in Myanmar has evolved through three primary legislative stages:

SCOPE AND APPLICABILITY

The mandates outlined in AML 2026 apply directly to all Reporting Organizations, which are legally defined to include:

• Commercial Banks
• Non-Bank Financial Institutions (NBFIs)
• Designated Non-Financial Businesses and Professions (DNFBPs)

Under Section 3 (g) of AML 2026, DNFBPs are specifically defined to include the following seven (7) categories of businesses and professionals:

(i) Casino;
(ii) Real estate agents;
(iii) Dealers in precious metals and gemstones;
(iv) Lawyers, notaries, legal professionals, and accountants when preparing or executing transactions for clients concerning:

• Buying and selling of real estate;
• Managing client money, securities, or other assets;
• Managing bank, savings, or securities accounts;
• Organizing contributions for the creation, operation, or management of companies;
• Creating, operating, managing, buying, or selling legal entities or business arrangements.

(v) Trust and company service providers offering services such as:

• Acting as a formation agent of legal entities;
• Acting as (or arranging for another person to act as) a director, company secretary, partner, or equivalent position;
• Providing a registered office, business address, accommodation, or administrative address for a legal entity.

(vi) Trustees acting as (or arranging for another to act as) a trustee of an express trust or equivalent legal arrangement.
(vii) Nominee shareholders acting as (or arranging for another to act as) a nominee shareholder for another person.

ESSENTIAL STATUTORY PROVISIONS FOR COMMERCIAL OPERATIONS

(i) Cross-Border Transport and Customs Declarations (Chapter 11)
AML 2026 heavily regulates the physical movement of high-value assets across Myanmar’s borders.

• Section 48: Any individual transporting cash, bearer negotiable instruments, precious stones, or metals meeting a specified threshold into or out of Myanmar is legally required to make a formal declaration to the Customs Department. This applies whether the assets are carried on a person, in luggage, via vehicles, or within cargo shipments.
• Section 49: The Customs Department is mandated to seize any undeclared or falsely declared cash and instruments, and to initiate AML investigations.
• Section 65: Non-compliance with Section 48 carries severe criminal liability. Individual offenders face 6 months to 1 year of imprisonment and/or a fine up to 100 million MMK. If the offense is committed on behalf of a corporate entity, the company faces a fine of up to 300 million MMK. The undeclared assets are also subject to confiscation as state funds.

(ii) Enhanced Financial Scrutiny and Corporate Transparency (Chapter 9)

• Beneficial Ownership Verification (Section 27): Reporting Organizations must identify the “Beneficial Owner” of a company and verify their identity. Banks are required to maintain a full understanding of a corporate client’s ownership and control structure before processing international wire transfers or establishing business relations.
• Suspicious Transaction Reports (Section 39): Reporting Organizations are compelled to immediately file a STR to the Financial Intelligence Unit (FIU) if a transaction is suspected of involving proceeds of crime or terrorism financing.
• Record Retention (Section 31): Reporting Organizations must maintain comprehensive records of transactions, account files, and business correspondence for a minimum of five years following the completion of a transaction or the closure of an account.

WHAT REPORTING ORGANIZATION AND BUSINESSES SHOULD DO NOW

In practical terms, AML 2026 signals a transition from a compliance-focused regime to a liability-focused regime, where failures in transparency, reporting, and due diligence may expose both corporate entities and their beneficial owners to substantial financial penalties, criminal sanctions, and asset confiscation. Early assessment of existing compliance frameworks and timely implementation of necessary enhancements will be essential to mitigate regulatory and enforcement risks under Myanmar’s new anti-money laundering landscape.
Commercial banks, non-bank financial institutions, and DNFBPs should therefore review and strengthen their internal AML policies, customer due diligence procedures, beneficial ownership verification mechanisms, transaction monitoring systems, and employee training programs to ensure compliance with the new legal requirements. Businesses engaged in cross-border transactions should also pay particular attention to customs declaration obligations and enhanced scrutiny of fund movements.

Disclaimer: The information provided in this newsletter is for general informational and educational purposes only and is not intended to be, nor should it be interpreted as, legal advice or a formal legal opinion. No reader should act, or refrain from acting, based on the contents of this update without first seeking professional legal counsel tailored to their specific circumstances and jurisdiction. For comprehensive legal support or specific inquiries regarding your company’s compliance, please contact our team directly at firm@iicole.com.