YANGON, Myanmar- New rules for billboard advertising rates

Shin Moe Myint/The Myanmar Times

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The Yangon City Development Committee (YCDC) will start using an instant payment system to collect payments for billboard rental fees within municipal areas.

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The government aims to eliminate excessive debts accumulating among advertisers in the city with the new system, according to YCDC.

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Although the grace period for a one year lease period was one month, it has now been shortened to one week – according to a report by the auditor general.

The auditor general’s 2017-2018 fiscal year report stated that officials must timely take action with collecting payments for billboards under the supervision of the YCDC, so as to avoid debt.

Moreover, lease is required to make a firm contract with the assistance of a lawyer if necessary, to ensure the terms are acceptable, the Public Accounts Committee suggested.

“When inviting applications, we have stated in the press that applicants have to pay K20 Lakh deposit to avoid brokers who sell the space back,” said U Sit Min Han, assistant head (deputy director) of YCDC’s administration.

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Billboard areas are classified into five zones depending on popularity, designated from A to E. Yearly rentals are K25 million for Zone A, K18 million for Zone B, K13.5 million for Zone C, K10 million for Zone D, and for Zone E the cost is K5 million.

Previously, all billboard rates K135 Lakh, but the new classification and collection rules takes into account the demand for advertising space. The system is also more convenient in terms of making payments, the Public Accounts Committee suggested.

There are over 500 billboards within YCDC’s jurisdiction, and about 350 were rented out in the 2015-16 fiscal year. That number was 280 rentals in 2016-17. Moreover, only 90 billboards were rented in 2018-19 fiscal year, he said.

Interested persons may rent vacant billboards for short- and long-term periods, and applications will be processed on a first-come-first-serve basis.

Billboards hired out by the YCDC are vinyl boards with LED lights. Applicants are currently permitted to advertise only on private land or buildings. For clients who rent LED billboards on private land, an annual tax of K25, 000 is collected per square foot of the billboard.

Billboards are mostly hired by advertising companies, while some companies hire the space themselves. Many companies rent the space for short periods – a month or three months – depending on their needs. They tend to hire advertising companies to take care of the rental agreements, and avoid dealing directly with the YCDC.

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“People used to rent billboards for strange advertisements, and sometimes for only 10 days or so. In those days there were no regular customers. As more people use social media and Facebook via mobile phones, online advertising has become far more effective,” said U Aung Myint, Operation Head of 2.0 Co. Ltd.

“Although billboards are an older method of advertising, they’re still useful for launching new or foreign products into a market,” said U Pyae Phyo Thein, director of Myanmar Outdoor-Indoor Advertizing Company.

“The billboard advertising businesses is not doing well at the moment – about 50 percent less, in terms of clients than what it was in the past,” he added.

Apart from billboards, tax will be imposed on sign boards directing people to their businesses in the YCDC municipal area. If businesses deploy these kinds of advertising signs, they will be notified and charged the applicable tax, according to YCDC.

Some businesses have at most 15 such sign boards placed around their premises. Instead of being removed completely, each business should negotiate the number of signs they can use, the Public Accounts Committee suggested.  – Translated

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