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	Foreign investment in the MALDIVES
	Foreign Investment Services Bureau (FISB)
	Possible options for establishing foreign investments in the Maldives
	Annex 1 - Documents comprising a foreign investment application
	Positive List

Foreign investment in the Maldives

Foreign Direct Investments (FDI) has always played a crucial role in the economic development of the Maldives. The Government acknowledges the importance of foreign investment and recognizes its contribution to economic development and employment creation. The Law on Foreign Investments in the Republic of Maldives (Law 25/79) governs foreign investments in the country. Foreign investments in the tourism sector are registered with the Ministry of Tourism and Civil Aviation while all non tourism foreign investments are registered with the Ministry of Economic Development and Trade.

The success of foreign investments in the Maldives can be attributed to its open and liberal economic environment, relative political stability and the consistent growth of the economy, which has achieved an average annual growth rate of 7.5 percent over the last 15 years. Foreign investors are offered a simple and transparent policy environment and continuous efforts are being made to make the investing environment more predictable and transparent. Capitalizing on the numerous benefits of investing in the Maldives, many reputed international brand names have established their presence in the country. Amongst them are world class resort investments by international hotel chains such as Hilton, Four Seasons, One & Only, Club Med and numerous other regional brands. Other foreign investments in the Maldives are concentrated in the transport and telecoms sectors, water production and distribution, and in the financial sector. Many global brand names, such as HongKong Shanghai Banking Corporation (HSBC), Ernst and Young (E&Y), Price Waterhouse Coopers (PWC), KPMG and many reputed insurance providers have strongly established themselves in the Maldives. Foreign investments, irrespective of their size, are encouraged to enter and operate in the Maldives.

Literally, all sector's of the Maldives economy is open for foreign investors. However, small investors are encouraged to form joint-ventures (JVs) with Maldivian nationals or companies registered in the Maldives.

Foreign Investment Services Bureau (FISB)

FISB, the government agency entrusted with promoting, regulating and licensing foreign investments in the country, is the first port of call for all foreigners keen to invest in the Maldives. The process of registering a foreign investment, as required by Law, is simple and straight forward. Prospective investors can expect to get their operations under way within 10 days from the date that all the required documentation are submitted to FISB. FISB also plays an active role in supporting investors in their establishment and operations.

In short, FISB provides assistance at every stage of the investment process and will pave the way for speedy commercial operations. The following are the main functions and services that are provided by FISB:

	Marketing and promotion of the Maldives as an investment destination.
	Providing information on the Maldives and potential areas of investment to prospective investors.
	Providing information and guidance on the application process to foreign investors.
	Issuing licenses for foreign investors to conduct business operations in the Maldives.

Possible options for establishing foreign investments in the Maldives

Foreign investors may choose, either to set up an investment wholly owned by foreigners or form joint ventures with Maldivian Nationals or companies registered in the Maldives. As such foreign investments may enter the Maldives under the following THREE options

options

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	A decision on all foreign investment proposals received by FISB, which meet the conditions, stated in Option I will be made and communicated to the investor within 10 working days, upon submission of all the relevant documentation listed in Annex 1
	A decision on all foreign investment proposals received by FISB, which meet the conditions stated either in Option II or Option III will be made and communicated to the investor within 30 working days, upon submission of all the relevant documentation listed in Annex 1

Incentives for foreign investors

	There is no income tax, corporate tax or property tax in the Maldives
	Legally backed investment guarantee
	Long term contractual agreements and long term lease of land
	Freedom to use foreign managerial, technical and unskilled workers
	No restrictions on the repatriations of earnings or profits
	The application of some of the above incentives is subject to specific guidelines described elsewhere in this brochure

Cost of doing business

1. Cost of incorporating a Company in the Maldives

The following fees are to be paid to the Registrar of Companies at the time of incorporation of a Company in the Maldives.

Annual fee	USD 156 (approx.)
Stamp fee	USD 39 (approx.)
Company registration fee	The fee depends on the authorized capital of the Company (Minimum authorized capital of USD 156 [approx.] is required by Law)

2. Cost of re-registering a Company in the Maldives

Re-registering a Company resident overseas in the Maldives is free

3. Royalty on Foreign Investments

Foreign investments registered with the FISB are required to pay an annual royalty to the government, as per the following schedule:

	Foreign investment entities whose ownership is at least 51 percent held by Maldivians or wholly owned Maldivian entities incorporated in the Maldives, are required to pay an annual royalty equivalent to 1.5 percent of Gross Turnover or 7.5 percent of Net Profit, whichever is greater.
	Foreign investment entities, in which, less than 51 percent of the ownership is held by Maldivians or wholly owned Maldivian entities incorporated in the Maldives, are required to pay an annual royalty equivalent to 3 percent of Gross Turnover or 15 percent of Net Profit, whichever is greater.