Starting a Business in Maldives offers strong opportunities for entrepreneurs due to the country’s tourism-driven economy and rich natural resources. Tourism and food-related industries contribute nearly 90% of government revenue, making them the most profitable sectors. Along with this, the fishery industry is the second-largest business sector and plays a major role in exports.
Seafood and coastal fruit exports account for almost 98% of Maldives’ total export value, creating excellent scope for processing, packaging, and export-focused businesses. However, before entering the market, it is important to understand the legal rules, licensing process, and investment regulations. Having clear knowledge of these aspects helps ensure a smooth and successful business setup in Maldives.
Pros of Starting a Business in Maldives
Stable economy
Maldives has been witnessing a consistent influx of FDI ever since it became a member of the International Finance Corporation, an extended arm of the World Bank Organisation. The GDP, after being dented by the COVID-19 outbreak, witnessed consistent growth as its major sectors continued to thrive. The government has launched several programs, including investment initiatives, to support overseas businesses and investors.
Potent workforce
Building the workforce is among the key barriers to starting overseas ventures. Luckily, Maldives does not offer any pitfalls in this context thanks to its robust educational system and English being the primary business language.
Simplified Bureaucratic Framework
Maldives supports a seamless bureaucratic framework, paving the way for hassle-free business registration. Most businesses, be they indigenous or overseas, don’t unnecessarily confront paper-intensive procedures to bring their venture to life.
Legal Aspects of Starting A Business in Maldives
- Choosing a business name that is unique and legal as per the nation’s by-laws is mandatory
- Securing a legal business place is vital.
- Registering a business name and address with the Ministry of Economic Development[1] office is also paramount.
- The availability of a corporate bank account is essential. The bank account must have a minimum capital deposit depending on the type of structure being chosen.
- Management-wise, the company must have at least two shareholders and directors. At least one director should be a local national. The shareholder can either be a company or an individual.
- The company must also have a company secretary for managing compliance and finance affairs. Such professionals should be local residents.
Documents for Registering a Business in Maldives
Now we have learned what’s required to set up a legally abiding entity in Maldives, let’s focus on the mandatory paperwork to support registration.
For a new company
- Charter documents such as MoA and AoA. The MoA i.e. Memorandum of Association must entail the company’s objects, structure, and essential clauses depending on the nature of the business. Meanwhile, AoA i.e. Article of Memorandum must embody the rules, company structure, and required norms, reinforcing the company’s legal gravity.
- ID and Address proof of Directors, Shareholders, and employees
- Fully filled out registration and name approval form
- An acceptance letter issued by the company’s CS and managing directors, evidencing their acceptance for starting a business in Maldives.
For a branch office or an extension company
- ID and Address proof of Directors, Shareholders, and employees
- Board members’ approval showing their consent to set a company as a branch
- Financial documents of the controlling company.
Company Registration Process: A Step-by-Step Guide for starting a business in Maldives
Starting a business in Maldives involves complying with the following steps:
Step 1: Apply to the Ministry of Economic Development
An overseas applicant applying for business registration must apply to the Ministry of Economic Development. It is a ticket to invest overseas funds in Maldives. The registration application can be fetched from the official website trade.gov.mv. If you caught in two minds, let’s Advisou be your partner. From global incorporation and IPR to industry-specific approval, Advisou shines with a robust portfolio of services, making the business quest seamless and hassle-free for clients globally.
Step 2: Get approval from the Ministry of Economic Development
Before legalizing the entity, the Ministry of Economic Development will verify the request for FDI in Maldives. Only after finding the application in adherence to underlying laws, the authority will show the green signal. While investigating the matter for FDI, the authority may conduct a questioning session with shareholders. The timeline to complete this process may last for 2-14 days.
Step 3: Company registration
The applicant must choose an apt business structure for a company registration. Some common structures available for registration include:
- Limited Liability Company: LLC is a popular structure that ensures 100% ownership over business for an overseas businessman. Also, the taxes and liabilities are limited, making it an ideal choice for foreign entrepreneurs.
- Partnership: This business model suits individuals seeking to operate collectively, aiming to achieve a common goal.
- Branch office: It serves as an extended arm of the parent company, helping the later with several endevours, such as market research, promotion, etc.
Note: You can visit the business.egov.mv and trade.gov.mv. to secure the application for each business type.
Step 4: Sign FIA
Businesses belonging to sectors other than tourism must approach the Ministry of Economic Development to sign the Foreign Investment Agreement (FIA). The tourism-oriented businesses must have the approval of the Ministry of Tourism.
Step 5: Obtaining license and permit
After addressing the aforementioned steps, apply for trades and licenses based on the industry/sector being chosen. The completion of this step shall mark the end of the registration process, enabling you to start your business endevours without hassle.
Conclusion
That’s all about the legalities concerning starting a business in Maldives. If you have any queries or seek assistance relating to starting a venture abroad, feel fee to talk to Advisou’s executives. Advisou is a trusted name in the world of global incorporation and regulations. Whether you want to set up a compliance-intensive business or an advanced production unit, Advisou’s expertise will let you go the extra mile.
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