If you’re planning on buying a Maldives vacation villa because you’re setting up a business in the Maldives there are a few important things you should know.
Firstly, we’d like to welcome you to the Maldives! And secondly, we recommend you seek advice directly from the Maldives’ Ministry of Economic Development which is the government department responsible for processing your application to open a company. However, this post will offer you a quick and simple overview of the process and help highlight some of the aspects you’ll need to consider.
The registration category for someone who isn’t a Maldivian citizen opening a company in the Maldives is known as a ‘Foreign Investment’ in Maldivian English. The process of registration is usually very fast – it can be completed in as little as 17-30 days. You must apply in person at the Ministry of Economic Development in Malé or give a representative Power of Attorney to complete the process on your behalf.
It requires a minimum investment of USD $1 million. And as we explained in our post on Working in the Maldives, this entitles you to a Corporate Resident Visa for an additional $2,000 which lasts for a year and can be renewed again annually.
The World Bank’s Doing Business Report rates the Maldives 89.2 out of 100 overall for starting a business according to the 2020 report. This report uses data gathered from local businesses, not from Foreign Investments.
Perhaps you’re wanting to make a smaller investment than the $1 million required for a Foreign Investment. If this is the case, then the only option is registering the business in the name of a trusted Maldivian partner, who will legally own and operate it. Then you would need to work out an agreement between yourself and your partner with the help of a lawyer that would lay out the terms and conditions, such as you running the business for them, how much input they would have, how you would allocate profits and expenses and so on.
This option is legal but you need to ensure you have a good working relationship with your business partner. In the unlikely event that you require it at any point, there are options for professional arbitration in the Maldives.
The newly-formed Maldives Bar Council has a list of law firms and public notaries on its website. It includes useful phone numbers, addresses and email addresses. You may also wish to also check Google and Facebook reviews before appointing someone to represent you or to seek a recommendation from the Bar Council.
You will find that all Maldivian lawyers are fluent in English, and some speak additional foreign languages such as Italian, French or Japanese too as these are popular third languages amongst many of Maldives’ polyglots.
In case you require arbitration to resolve an issue you may be reassured to hear that foreign arbitration is a legally-recognized option in the Maldives. The Maldives is not a party to the New York Convention, but foreign arbitral awards are enforced under Section 72 of the Arbitration Act (Law No.: 10/2013). Our preferred location for all arbitration is the United States of America.
According to the Arbitration Act: Recognition and Enforcement (72) “An arbitral award made in a foreign country shall be recognized and enforced in the Maldives as long as the award was not made in contradiction with the procedures of this Act. The enforcement of an arbitral award shall be mandatory in the Maldives”.
The biggest economy in the Maldives is tourism. As such, there are ais a multitude of opportunities for Foreign Investment such as resorts, travel agencies, construction firms, architecture firms, resort suppliers/product importers, yachting and scuba diving operations. There is also plenty of scope for new concepts too which have not yet been introduced or tapped, such as water parks, eco-parks and mangrove ecotourism.
The second-largest economy is fishing. Fishing has been a huge part of Maldivian life for centuries and the Maldives is one of the world’s best-known suppliers of sustainable fish, particularly blue-fin tuna. That’s because the Maldives has strict laws regarding fishing and the protection of its oceans. Only sustainable pole and line fishing is permitted in the Maldives. This means there are opportunities for marketing sustainable fish, international exports etc.
There is also a great deal of interest and urgency in the Maldives in renewable energy options, and scope for greatly improving trash disposal and recycling services. In fact, The World Bank identified renewable energy investment in the Maldives (particularly solar) as a prime investment which could also help support the economy’s recovery from the COVID-19 pandemic. Business proposals in this area have historically received a lot of support from the government and current indications predict this will be the case in 2020 onwards. This is not an exhaustive list of opportunities but is food for thought.
The registration category for someone who isn’t a Maldivian citizen opening a company in the Maldives is known as a ‘Foreign Investment’ in Maldivian English. The process of registration is usually very fast – it can be completed in as little as 17-30 days. You must apply in person at the Ministry of Economic Development in Malé or give a representative Power of Attorney to complete the process on your behalf.
It requires a minimum investment of USD $1 million. And as we explained in our post on Working in the Maldives, this entitles you to a Corporate Resident Visa for an additional $2,000 which lasts for a year and can be renewed again annually.
The World Bank’s Doing Business Report rates the Maldives 89.2 out of 100 overall for starting a business according to the 2020 report. This report uses data gathered from local businesses, not from Foreign Investments.
Perhaps you’re wanting to make a smaller investment than the $1 million required for a Foreign Investment. If this is the case, then the only option is registering the business in the name of a trusted Maldivian partner, who will legally own and operate it. Then you would need to work out an agreement between yourself and your partner with the help of a lawyer that would lay out the terms and conditions, such as you running the business for them, how much input they would have, how you would allocate profits and expenses and so on.
This option is legal but you need to ensure you have a good working relationship with your business partner. In the unlikely event that you require it at any point, there are options for professional arbitration in the Maldives.
The newly-formed Maldives Bar Council has a list of law firms and public notaries on its website. It includes useful phone numbers, addresses and email addresses. You may also wish to also check Google and Facebook reviews before appointing someone to represent you or to seek a recommendation from the Bar Council.
You will find that all Maldivian lawyers are fluent in English, and some speak additional foreign languages such as Italian, French or Japanese too as these are popular third languages amongst many of Maldives’ polyglots.
In case you require arbitration to resolve an issue you may be reassured to hear that foreign arbitration is a legally-recognized option in the Maldives. The Maldives is not a party to the New York Convention, but foreign arbitral awards are enforced under Section 72 of the Arbitration Act (Law No.: 10/2013). Our preferred location for all arbitration is the United States of America.
According to the Arbitration Act: Recognition and Enforcement (72) “An arbitral award made in a foreign country shall be recognized and enforced in the Maldives as long as the award was not made in contradiction with the procedures of this Act. The enforcement of an arbitral award shall be mandatory in the Maldives”.
The biggest economy in the Maldives is tourism. As such, there are ais a multitude of opportunities for Foreign Investment such as resorts, travel agencies, construction firms, architecture firms, resort suppliers/product importers, yachting and scuba diving operations. There is also plenty of scope for new concepts too which have not yet been introduced or tapped, such as water parks, eco-parks and mangrove ecotourism.
The second-largest economy is fishing. Fishing has been a huge part of Maldivian life for centuries and the Maldives is one of the world’s best-known suppliers of sustainable fish, particularly blue-fin tuna. That’s because the Maldives has strict laws regarding fishing and the protection of its oceans. Only sustainable pole and line fishing is permitted in the Maldives. This means there are opportunities for marketing sustainable fish, international exports etc.
There is also a great deal of interest and urgency in the Maldives in renewable energy options, and scope for greatly improving trash disposal and recycling services. In fact, The World Bank identified renewable energy investment in the Maldives (particularly solar) as a prime investment which could also help support the economy’s recovery from the COVID-19 pandemic. Business proposals in this area have historically received a lot of support from the government and current indications predict this will be the case in 2020 onwards. This is not an exhaustive list of opportunities but is food for thought.
Beyond the resources we have already listed, you may also wish to investigate these:
Permanent Mission of the Republic of the Maldives – Commercial affairs synopsis
Maldives Embassy in Singapore – Why Invest in the Maldives?
The Business Report – An annual publication on investing in the Maldives
Let’s Invest Maldives – Investment advisory company
Meerubahuruge Aage (2F), Henveiru, Male, Maldives 20077
150 Spear St. San Francisco, CA 94105, USA
