Committee extends review of forex amendment to August 16

The Parliament’s Public Accounts Committee has extended the deadline for completing its review of proposed amendments to the Foreign Exchange Act, pushing the process to Sunday, August 16.

The bill, submitted during Wednesday’s sitting of the People’s Majlis by Holhudhoo MP Abdul Sattar Mohamed of the ruling People’s National Congress (PNC), seeks to remove the option that currently allows resorts to exchange a fixed amount of USD 500 per tourist.

Following its submission, the bill was referred to the Public Accounts Committee for review. The committee initially decided to accept public comments until 11:30 a.m. on Thursday and complete its review the same day.

However, during a committee meeting on Thursday, members voted to extend the review period. The motion was proposed by Funadhoo MP Mohamed Mamdooh and approved by the committee. The next meeting has been scheduled for 10:30 a.m. on Sunday.

Under the Foreign Exchange Act, which was enacted in late 2024 and came into force in January last year, resorts are required to exchange part of their foreign currency earnings through banks operating in the Maldives.

At present, resorts may comply with the law through one of two options:

The proposed amendment would abolish the USD 500 per tourist option, leaving resorts with a single requirement to convert 20 per cent of their monthly foreign currency revenue.

If enacted, the change would increase foreign currency conversion requirements for resorts currently using the per-tourist option.

Under the law, resorts are classified as Category A tourism establishments. Category B operators, which include hotels, guesthouses, safari vessels and tourist vessels, would continue to retain the existing options of converting either USD 25 per tourist or 20 per cent of monthly revenue.

The bill also proposes several other changes to the foreign exchange framework. These include raising the annual foreign currency revenue threshold for mandatory conversion by non-tourism businesses from USD 15 million to USD 25 million.

In addition, businesses outside the tourism sector that are fully Maldivian-owned would be required to convert seven per cent of their foreign currency revenue, while businesses without full local ownership would continue to convert 20 per cent.

The amendments would also require every resort to deposit its foreign currency earnings into a designated account held at a bank licensed in the Maldives and notify the Maldives Monetary Authority (MMA). Current legislation does not require the account to be maintained with a locally operating bank.

The extension of the committee review followed the cancellation of an additional parliamentary sitting that had been scheduled for Thursday.

It is understood that the sitting had been planned to consider and vote on the bill once the committee completed its review. With deliberations continuing, the matter is now expected to return to Parliament after the committee submits its report.