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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The former Act was repealed, existing companies continued, and transition periods did not preserve inconsistent constitutional provisions indefinitely.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.
Appointment, removal, resignation and vacancy
Director changes must satisfy the Articles, preserve minimum governance and be followed by internal and Registrar records.
Explanation and core rules
Initial directors take office on registration; later appointments generally follow member decisions unless the Articles confer a nomination power. Removal follows the Articles. A resignation generally takes effect on receipt at the service address or a stated later date. A sole/last director cannot simply resign without the section 122 meeting procedure. Three months without a director in the stated circumstances can lead to inactive designation.
Step-by-step procedure
- Check appointment/removal power and notice procedure.
- Obtain consent and eligibility declaration for a new director.
- Pass the correct member decision.
- Manage the effective date without breaching board or residence minimums.
- Update the register and file within 15 days.
Documents and evidence
- Nomination/right evidence
- Member resolution
- Consent/declaration
- Resignation/removal notice
- Register update and Registrar filing
Points requiring care
Particular care is needed to avoid a sole director's purported immediate resignation leaving no lawful governance, as well as an investor-nominated director appointed without the precise Articles mechanism.
Related Act provisions
Section 119 — Legal Status and Consequences of Directors’ Actions
Overview of the provision
This provision preserves the validity of acts carried out by someone acting as a director if a defect in their appointment or a lack of qualification is discovered later. The later discovery therefore does not, by itself, undo the acts already performed in that capacity.
Provision references
The acts of a person acting as a director are valid notwithstanding that it is subsequently discovered that there was a defect in the person’s appointment or that the person was not qualified to act as a director.
Section 120 — Appointment of Directors
Overview of the provision
This provision places director appointment or election with the members, following the articles. A director named in the registration application is treated as validly appointed when the company registers and remains until the term ends, removal or resignation. Later appointments are made by member decision at a general meeting or by member resolution unless the articles provide otherwise. If the articles give a particular member the right to appoint directors, that member can exercise it by their own decision. The articles therefore need to be checked for both general appointment procedure and any specific nomination right.
Provision references
(a) Directors shall be appointed or elected by a decision of the members in accordance with the Articles of Association of the company.
(b) A person named as a director in the application for registration of a company shall be deemed to have been validly appointed as a director upon registration of the company and shall continue in office until the expiry of that person’s term, removal or resignation.
(c) After registration of the company, a person shall be appointed as a director by a decision of the members at a general meeting or by a resolution of the members, unless otherwise provided in the Articles of Association of the company.
(d) Where the Articles of Association confer on a particular member the power to appoint one or more directors, an appointment may be made by a decision of that member.
Section 121 — Removal of Directors
Overview of the provision
This provision requires the removal of a director to follow the procedure in the company's articles. The practical starting point is therefore the applicable removal clause in those articles, rather than assuming a procedure that the section does not itself set out.
Provision references
A director shall be removed from office in accordance with the procedure prescribed in the Articles of Association of the company.
Section 122 — Vacation of Office of Director
Overview of the provision
Leaving office
This provision recognises resignation, lawful removal, disqualification under section 118 because of section 115(b), death and other constitutional grounds as ways a directorship can become vacant. Resignation normally takes effect when the notice reaches the company's service address, or on a later date stated in the notice. A sole or last remaining director, even if also the sole member, cannot resign until notice of a meeting to appoint a replacement has been given and the resignation is submitted at that meeting or the meeting-notice period has expired.
Ensuring the company has a director
Where the only director's office becomes vacant through the specified disqualification, death or another constitutional ground, the members must convene a replacement-appointment meeting; if the person was also sole member, the heirs must do so. If that duty is not fulfilled and the company remains without a director for three months, the Registrar must designate it inactive under section 208. Leaving office does not remove liability for acts or omissions while the person was a director.
Provision references
(a) Subject to subsection (c), the office of a director becomes vacant— (1) upon resignation in accordance with subsection (b); (2) upon removal of the director in accordance with this Act and the Constitution of the company; (3) where the director is disqualified from office under section 118 of this Act by reason of any circumstance specified in section 115(b); (4) upon the death of the director; or (5) in any other manner specified in the Constitution of the company.
(b) Subject to subsection (c), where a director gives notice of resignation, the director shall be deemed to have vacated office when the notice is received by the company at its service address or on such later date as may be specified in the notice.
(c) Notwithstanding any other provision of this section, where a company has only one director, or only one director remains in office, that director may not resign until notice of a general meeting for the appointment of a new director has been given to the members and the notice of resignation is submitted at that meeting or the period of notice for that meeting has expired.
(d) Subsection (c) applies notwithstanding that the sole director is also the sole member of the company.
(e) Where a company has only one director and the office of that director becomes vacant under subsection (a)(3), (4) or (5), the members of the company or, where the sole director was also the sole member, the heirs of that person shall convene a general meeting for the appointment of a new director.
(f) Where a company fails to comply with subsection (e) and remains without a director for a period of 3 months, the Registrar shall designate the company as an inactive company in accordance with section 208 of this Act.
(g) Vacation of office does not affect the liability of a person under this Act or the Constitution of the company for any act or omission occurring while that person held office as a director.
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.