The promotional poster, which appeared on the bar's Facebook page, sparked outrage on social media in the predominantly Buddhist nation, which has seen a surge in religious nationalism in recent months.
General manager Philip Blackwood, 32, owner Tun Thurein, 40, and manager Htut Ko Ko Lwin, 26, were detained for police questioning yesterday and the bar was shuttered after a complaint by an official from Myanmar's Religious Department, police said.
"According to Philip's statement, they were trying to promote the bar. Buddha grabs people's interest... However Buddhists cannot accept it," a police official in Yangon's Bahan township told reporters late yesterday.
"This insults the religion. So we opened the case under the Religion Act. We will file a lawsuit," he said, requesting not to be named.
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Under the act, anyone who attempts to insult, destroy or damage any religion can be punished by a maximum of two years in jail, with another two-year penalty for those who attempt to insult religion through the written word.
A small group of locals protested outside the bar on last night, another police source said, requesting anonymity.
After criticism erupted the bar -- which opened just two weeks ago -- deleted the post and wrote an apology on the Facebook page.