President Dr. Mohamed Muizzu has ratified the new Foreign Investment Law, marking a significant modernization of the foreign investment framework that has governed the Maldives for over 45 years. The new law aims to boost Foreign Direct Investment (FDI) by providing a transparent and secure environment for foreign businesses.
The law, seeks to streamline the process of investment approval, enhance investor rights, and ensure security and clarity in business operations. Among the critical changes is the requirement for foreign entities and individuals to obtain an investment license prior to establishing long-term business operations in the Maldives. Additionally, the law mandates that the Ministry of Economic Development &Trade, in consultation with the Cabinet, publish a list of business sectors closed or restricted to foreign investors, with considerations made for national security, market competition, and local expertise.
Significantly, the law also upholds international treaties on investment promotion and protection, granting precedence to multilateral and bilateral agreements. This is seen as a critical assurance for major foreign investors, solidifying the Maldives as a secure destination for foreign direct investment. The provisions of the law also include measures for fair and equitable treatment of investors, the right to repatriate profits, and compensation for expropriation which is only possible for specific pubic interest and national security reasons.
This move is expected to attract higher levels of foreign direct investments, generate employment, and solidify the Maldives as a secure and competitive destination for international investors