A bill has been submitted to the parliament which proposes a fine up to MVR 1 million for foreign investors found in violations of laws.
The objective of the bill, submitted by Manadhoo MP Ahmed Haroon, on behalf of the government, is to create a legal framework that delineates sectors in which foreign investors are permitted to invest within the Maldives and to establish regulations on the issuance of licenses for such investors alongside the protections and safeguards they are entitled to.
It is also aimed at establishing the circumstances under which such investments can be expropriated by the state and the policies surrounding compensation in such a case. Furthermore, the bill also aimed to set down policies on the issuance of licenses for foreign contractors.
As per the bill, a foreign party can only carry out any investment-related work in the Maldives after seeking the license as stipulated under this act, and only after the approval for the foreign investment and the license has been received.
The record of investors awarded licenses shall be maintained by the relevant Ministry in accordance with regulations formulated once this bill becomes law.
While the Ministry reserves the right to withhold or nullify any such license issued – grounds for such actions may include bankruptcy of the investor, failure to carry out any work from one year of obtaining the license, or carrying out a work contradictory to the work permitted to actually undertake.
According to the bill, if the Ministry revokes an investor’s license, they will still need to settle all payments owed to the state and pay the salaries of all staff employed in relation to the investment.
However, the bill includes a provision, as part of the protections and safeguards investors are entitled to, which stipulates the state cannot expropriate any investment without plausible cause and without adequately compensating the investor.
The bill prohibits foreign investments from the following;
Under the bill, the investor will be provided a stipulated timeframe to adhere to instructions from the ministry regarding violations of the law. If the investor fails to comply with the instructions, they will be penalized based on the severity of the violation.
Penalties stated in the bill include;