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1. How to use this manual
Begin with a practical question, move to the mapped provisions, and finish by checking the current official filing route.
Subject: Orientation and legal framework
Act references: Practice orientation
Key point: Practice notes explain a workflow; the expandable statutory blocks show the relevant provisions in English.
2. Sources and hierarchy of authority
A reliable opinion distinguishes enacted law, regulations, administrative procedure and the English translation.
Subject: Orientation and legal framework
Act references: s. 1; s. 247; s. 248; s. 249; s. 250; s. 251
Key point: The official Dhivehi Gazette text of Law No. 7/2023 is the primary enacted source.
3. Scope and objectives of the Act
The Act supplies the lifecycle framework for formation, registration, operation and dissolution while aiming at simpler rules and transparent registers.
Subject: Orientation and legal framework
Key point: The Act governs formation, registration, operation and dissolution of companies in the Maldives.
4. Registration and separate legal personality
Registration creates a separate legal entity with perpetual succession, ownership of its assets and capacity to sue and be sued.
Subject: Orientation and legal framework
Act references: s. 23; s. 24; s. 25
Key point: The certificate records the company's name, number, type and registration date.
5. Transitional position and current-law check
The former Act was repealed, existing companies continued, and transition periods did not preserve inconsistent constitutional provisions indefinitely.
Subject: Orientation and legal framework
Act references: s. 241; s. 242; s. 243; s. 244; s. 245; s. 246
Key point: Companies registered under the former law continued under the new Act.
6. Company types and classification map
The Act recognises four company types, while foreign investment operates as an additional classification cutting across private and public companies.
Subject: Choosing the company vehicle
Act references: s. 3; s. 4; s. 5; s. 6; s. 7; s. 8
Key point: The four company types are private, public, government and local authority companies.
7. Private company
A private company may have one to 50 members, one or more directors and no public offer of its shares.
Subject: Choosing the company vehicle
Act references: s. 4; s. 9; s. 10; s. 11
Key point: The share capital consists of one or more shares.
8. Public company
Public-company status is tied to authority or an intention to seek authority to offer securities to the public and carries additional governance requirements.
Subject: Choosing the company vehicle
Act references: s. 5; s. 12; s. 13; s. 14
Key point: The constitution must expressly state that the company is public.
9. Government company
A government company is wholly Government-owned and formed by Presidential decree or statute, with the Companies Act operating alongside its constituting instrument.
Subject: Choosing the company vehicle
Act references: s. 6; s. 15; s. 16; s. 17; s. 18
Key point: All shares forming the capital are registered in the name of the Government.
10. Local authority company
A local authority company is formed by one or more councils for economic activities within council jurisdiction and basic-needs responsibilities.
Subject: Choosing the company vehicle
Key point: Ownership and purpose derive from the council framework in section 7.
11. Foreign investment company
Any direct or specified indirect foreign participation can bring a private or public company within the foreign-investment classification.
Subject: Choosing the company vehicle
Act references: s. 8
Key point: The classification captures a company with any share registered to a foreign individual or entity.
12. Foreign company re-registration
A foreign legal entity may operate through re-registration, but must obtain the relevant authorisation, appoint a qualified Maldives-resident agent and maintain change reporting.
Subject: Choosing the company vehicle
Act references: s. 33; s. 34; s. 35; s. 36; s. 37
Key point: A foreign company must not conduct activity in Maldives without the required registration.
13. Pre-incorporation decision map
Good formation work begins before the application: activity, ownership, control, capital, constitutional protections and regulatory dependencies must be settled first.
Subject: Formation and registration
Key point: Registration requires a reserved name, company type, address, capital/share information, constitution and director particulars.
14. Company name selection and reservation
A company name must be available, accurate, non-misleading and compliant with the Act, Regulation and business-name rules.
Subject: Formation and registration
Act references: s. 66; s. 67; s. 68; s. 69; s. 70; s. 71; s. 72; s. 73; s. 74
Key point: The name must reflect the true nature of the company and must not be misleading or prohibited.
15. Registering a private company
A private-company filing should be the final expression of an agreed ownership and governance structure, not the starting point for those decisions.
Subject: Formation and registration
Act references: s. 20; s. 21; s. 23; s. 24; s. 25
Key point: The application identifies the reserved name, type, registered address, capital and agreed initial share distribution.
16. Registering a public company
Public-company formation requires the Companies Act registration workstream and a separate securities-law workstream for any public offer.
Subject: Formation and registration
Act references: s. 12; s. 13; s. 14; s. 20; s. 21; s. 23; s. 24; s. 25; s. 171; s. 172; s. 173
Key point: The constitution expressly identifies public-company status.
17. Registering Government and local authority companies
Formation must reconcile the Companies Act application with the instrument and approvals that create or authorise the public body company.
Subject: Formation and registration
Act references: s. 15; s. 16; s. 20; s. 22; s. 23; s. 24; s. 25
Key point: A Government company may be established by decree or statute and registered under the Act.
18. Re-registering a foreign entity
Re-registration preserves the foreign entity while placing its Maldives operation, agent and information within the local register.
Subject: Formation and registration
Act references: s. 33; s. 34; s. 35; s. 36
Key point: Foreign investment authorisation precedes re-registration.
19. Foreign-company agent: role and exposure
The agent is more than a postal contact: the Act assigns responsibility to the Registrar and personal liability in respect of enforcement against the foreign company.
Subject: Formation and registration
Key point: The agent must be an individual aged at least 18, ordinarily resident in Maldives and free of the specified disqualifications.
20. Certificate and day-one corporate housekeeping
The first post-registration work should convert a certificate into a functioning, evidenced corporate organisation.
Subject: Formation and registration
Act references: s. 23; s. 24; s. 25
Key point: The certificate is evidence of incorporation and its registration date.
Abuse of management power and court relief
The Act provides court remedies for abusive management and, in serious cases, personal liability through lifting the corporate veil.
Explanation and core rules
Sections 61 to 64 provide standing and remedial powers for abuse of company management. The applicant must submit a resulting court order to the Registrar within 14 days under section 64. Section 65 addresses circumstances and consequences of lifting the corporate veil. These provisions should be analysed with directors' duties and any derivative or contractual remedy.
Step-by-step procedure
- Identify the impugned decision, decision-maker and injury.
- Preserve board, member, financial and communications evidence.
- Map statutory standing and available orders.
- Assess urgent/interim relief and parallel contractual claims.
- After an order, complete the Registrar filing and internal rectification.
Documents and evidence
- Constitution and shareholders' agreement
- Minutes/resolutions
- Financial records
- Conflict disclosures
- Court papers and order
- Registrar submission
Points requiring care
Particular care is needed to avoid pleading a shareholder disagreement without identifying the statutory wrong and requested order, as well as failing to file a relevant court order within section 64's period.
Related Act provisions
Section 61 — Abuse of Power in Company Management
Overview of the provision
This provision enables an application to the Court where company conduct harms the interests of members as a whole, or is oppressive, unfairly prejudicial or discriminatory towards one or more members, whether as members or in another capacity. In deciding whether that threshold is met, the Court considers the company's management, its actual or proposed acts and omissions, and resolutions already passed or proposed by members or a class of members. The inquiry therefore reaches both conduct that has occurred and relevant proposals before they are carried out.
Provision references
(a) An application may be made to the Court for an order in respect of an act or omission of a company where— (1) the conduct of the company is prejudicial to the interests of the members as a whole; or (2) the company acts in a manner that is oppressive, unfairly prejudicial or discriminatory towards a member or members, whether in their capacity as members or otherwise.
(b) In determining whether an act or omission of the company falls within subsection (a), the Court shall consider— (1) the management of the company; (2) any act done or proposed to be done, or any omission made or proposed to be made, by the company; or (3) any resolution passed or proposed by the members or by a particular class of members of the company.
Section 62 — Persons Eligible to Apply for a Court Order
Overview of the provision
This provision identifies who may seek an order under section 61. A member may apply about conduct affecting them either as a member or in another capacity, and other members may also apply. A former member can apply where the issue concerns the circumstances in which their membership ended. A person who acquired shares by will, inheritance or operation of law is also eligible. The provision extends access beyond a narrow class of current registered members affected only in their membership capacity.
Provision references
An application for an order under section 61 of this Act may be made by— (a) a member of the company in respect of an act or omission affecting that member— (1) in a capacity other than that of a member; or (2) in the capacity of a member;
An application for an order under section 61 of this Act may be made by— (b) any member other than the member making an application under paragraph (a);
An application for an order under section 61 of this Act may be made by— (c) a person who has ceased to be a member of the company, where the application relates to the circumstances in which that person ceased to be a member; or
An application for an order under section 61 of this Act may be made by— (d) a person who has acquired shares in the company by will, inheritance or operation of law.
Section 63 — Court Orders
Overview of the provision
This provision gives the Court a range of possible responses in proceedings under sections 61 and 62 where it considers a direction necessary. It can direct a person to act, amend the memorandum or articles, or regulate the company's future affairs. It can order the purchase of shares acquired by will, inheritance or operation of law, or a share purchase that reasonably reduces the company's capital. It may also appoint a receiver, liquidator or manager over some or all assets, restrain specified conduct, or order winding up. The list illustrates the orders available; the Court chooses the response it considers appropriate in the case.
Provision references
In proceedings brought before the Court in accordance with sections 61 and 62 of this Act, where the Court considers it necessary to require the company or any person to act in a particular manner, the Court may make such orders as it considers appropriate, including— (a) directing a particular person to act in a specified manner;
In proceedings brought before the Court in accordance with sections 61 and 62 of this Act, where the Court considers it necessary to require the company or any person to act in a particular manner, the Court may make such orders as it considers appropriate, including— (b) ordering an amendment of the company’s Memorandum of Association or Articles of Association;
In proceedings brought before the Court in accordance with sections 61 and 62 of this Act, where the Court considers it necessary to require the company or any person to act in a particular manner, the Court may make such orders as it considers appropriate, including— (c) giving directions for the future conduct of the affairs of the company;
In proceedings brought before the Court in accordance with sections 61 and 62 of this Act, where the Court considers it necessary to require the company or any person to act in a particular manner, the Court may make such orders as it considers appropriate, including— (d) ordering the purchase of shares belonging to a member who acquired them by will, inheritance or operation of law;
In proceedings brought before the Court in accordance with sections 61 and 62 of this Act, where the Court considers it necessary to require the company or any person to act in a particular manner, the Court may make such orders as it considers appropriate, including— (e) ordering the purchase of shares in a manner that results in a reasonable reduction of the share capital of the company;
In proceedings brought before the Court in accordance with sections 61 and 62 of this Act, where the Court considers it necessary to require the company or any person to act in a particular manner, the Court may make such orders as it considers appropriate, including— (f) appointing a receiver, liquidator or manager in respect of some or all of the assets of the company;
In proceedings brought before the Court in accordance with sections 61 and 62 of this Act, where the Court considers it necessary to require the company or any person to act in a particular manner, the Court may make such orders as it considers appropriate, including— (g) restraining a person from carrying out a specified act; or
In proceedings brought before the Court in accordance with sections 61 and 62 of this Act, where the Court considers it necessary to require the company or any person to act in a particular manner, the Court may make such orders as it considers appropriate, including— (h) ordering the winding up of the company.
Section 64 — Submission of Court Order to the Registrar
Overview of the provision
This provision places the filing responsibility on the applicant who obtained a section 63 order. The applicant must send a copy to the Registrar within 14 days of the date the Court made it. The period therefore runs from the order itself, rather than a later decision to implement it.
Provision references
Where the Court makes an order under section 63 of this Act, the applicant shall submit a copy of the order to the Registrar within 14 days from the date on which the order is made.
Section 65 — Lifting the Corporate Veil
Overview of the provision
When personal liability may arise
This provision allows the Court, subject to subsection (b), to look beyond the company's separate legal identity where it is used for fraud or solely for the personal benefit of directors, members or officers. Those involved may then become personally responsible for acts carried out in the company's name. The stated conditions are cumulative: company and owners do not operate separately, fraudulent or wrongful conduct is concealed or liability avoided through the company, and that misuse directly causes loss for which corporate personality is being used to escape responsibility.
The conduct and possible orders
The Court may consider fraudulent conduct, misappropriation or unauthorised use of assets, deliberate direct or indirect misuse of corporate personality for someone's benefit to the company's detriment, and dividends declared while debts cannot be paid. On an application under this section, it may impose unlimited personal liability jointly or individually on the relevant directors, members and officers. After making that determination, it may order winding up or direct how the company's affairs should be conducted in future.
Provision references
(a) Subject to subsection (b), where a company registered under this Act engages in fraudulent activities, or where its directors, members or officers use the company solely for their personal benefit, the Court may lift the corporate veil. In such a case, notwithstanding the separate legal personality of the company, the directors, members or officers involved may be held personally liable for acts carried out in the name of the company.
(b) The Court may lift the corporate veil and hold directors, members or officers personally liable in respect of the affairs of the company where— (1) the company and its owners do not operate as separate entities; (2) the acts of the company are fraudulent or wrongful and the company is being used as a façade to conceal those acts or evade liability; and (3) the misuse of the company has directly caused loss to any person and the corporate personality of the company is being used to avoid legal responsibility for that loss.
(c) In determining whether to lift the corporate veil, the Court may regard the following as fraudulent or wrongful acts— (1) engaging in conduct that may be regarded as fraudulent; (2) misappropriating or making unauthorised use of the assets of the company; (3) deliberately misusing the legal personality of the company, directly or indirectly, for the benefit of the person concerned or another person, resulting in prejudice to the interests of the company; and (4) declaring dividends at a time when the company is unable to pay its debts.
(d) Upon an application made to the Court under this section, the Court may determine that the directors, members and officers concerned are personally liable, jointly or severally and without limitation, for the acts of the company.
(e) Where the Court determines personal liability under subsection (d), it may— (1) order the winding up of the company; or (2) give directions for the future conduct of the affairs of the company.
This page is a general research and practice aid. The translations used in this manual are unofficial. Verify the official Dhivehi legislation, amendments and current procedures before relying on any entry. Read our sources and verification guidance and contact a lawyer at Sulthan & Amhar for advice on your circumstances before relying on this material or taking action.