Maldives says new foreign investment law to empower investors
President Muizzu on Tuesday ratified the Foreign Investment Bill, passed by the parliament on August 22.
A new Foreign Investment Act is a step forward for Maldivian businessmen and foreign business executives investing in Maldives, economic minister Mohamed Saeed said on Tuesday.
President Mohamed Muizzu on Tuesday ratified the Foreign Investment Bill, passed by the parliament on August 22, marking it as the first Foreign Investment Act since a similar law enforced in 1979. The new law will come into force three months from Tuesday.
Speaking at a press conference at the President's Office following the ratification of the Foreign Investment Act, Saeed said that a country's affairs should be done in an transparent and predictable manner when such a law comes.
Saeed said President Muizzu came to power with major pledges to expand business and boost the economy.
“Expanding business and making Maldives an easy place to do business and making sectors like real estate a business sector,” he said.
Attorney General Mohamed Usham said the previous Foreign Investment Act was good for its time, but not for modern times.
“However, the law is not the best law in terms of the rights and protections that people who want to come to invest in Maldives today,” he said.
Usham said various governments have started working to bring the Foreign Investment Act up to date. This government came to power and started making major changes to the laws to make Maldives a green country for investors, he said.
The law ratified by President Muizzu is:
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To formulate rules on determining the areas in which foreign investors can invest in Maldives
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To formulate rules relating to the issuance of investment permits to such persons in Maldives and rules relating to the protection and security available to such investors
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To describe the special circumstances in which such investments may be taken by the state and the rules for compensating such investments
The purpose of the new law is to increase foreign investment in Maldives and create a favourable environment for the attraction of capital, technology and knowledge and skills through these investments.
The law plans to develop the economy of via:
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Determine the rules to be followed to promote investment in the international arena to attract foreign investors to invest in Maldives and maintain that interest
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Determine the areas and conditions for foreign investment in Maldives
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Determine the rules and conditions for issuing investment permits to foreign investors in Maldives
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Determining the scope of protection and safeguards available to foreign investors; Determine the rules for taking action against those who violate the law
Under the law, a foreign investment can only be made by obtaining permission to invest in the areas specified under it.
The law provides for free-flow investment in certain areas and in areas where investment can be made with conditions.
The economic minister should determine the areas where foreign investors cannot invest at all and where they cannot invest unless certain conditions are met.
Under the law, investment permission can be applied for:
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Citizens of a foreign country
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Foreign-owned company
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A company jointly owned by Maldivians and foreigners
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Directly or indirectly 100% Maldivian-owned company incorporated abroad
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Foreign-owned partnerships established in Maldives
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Foreign-owned company established in Maldives
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Companies re-registered in Maldives under the Companies Act
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Joint venture arrangements between Maldivians and foreigners
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Foreign organisations
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Legal entities created under the laws of another jurisdiction
The law also contains provisions relating to the issuance, withholding and revocation of foreign investment licenses.
