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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The former Act was repealed, existing companies continued, and transition periods did not preserve inconsistent constitutional provisions indefinitely.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.
Allotment of shares
An allotment requires the correct corporate authority, recipient consent where obligations increase, consideration, register entry, certificate and Registrar notification.
Explanation and core rules
Initial shares are allotted in the proportions agreed in the Articles on registration. For a non-public company, later allotment by the Board requires member-resolution authority and compliance with the constitution. Written consent is required if the allotment creates or increases the recipient's obligation; breach makes the allotment void. The Board generally determines consideration unless the constitution provides otherwise. The member register is updated, a certificate issued and the Registrar notified within 15 days of the change.
Step-by-step procedure
- Check capital authority, pre-emption and class rights.
- Obtain member authority and recipient consent.
- Board-allot the shares and document consideration.
- Update the Register of Members and issue the certificate.
- Notify the Registrar within 15 days and update SBO records.
Documents and evidence
- Subscription agreement/application
- Member resolution
- Board allotment resolution
- Recipient consent
- Consideration evidence
- Register/certificate/Registrar filing
Points requiring care
Particular care is needed to avoid calling a payment an equity investment before shares are validly allotted, as well as ignoring indirect SBO changes caused by an allotment.
Related Act provisions
Section 155 — Allotment of Shares
Overview of the provision
This provision requires initial shares to be allotted on registration to the people who agreed in the articles to take them, in the agreed proportions. Outside that initial allotment, the board of a company other than a public company may allot shares when authorised by a members' resolution and permitted by the Act and constitution. The constitution may prescribe particular procedures or member-approval requirements, provided they are consistent with the Act. The board's allotment power therefore needs both the statutory authority and the applicable internal approval.
Provision references
(a) Upon registration of a company under this Act, shares shall be allotted, in the respective proportions, to the persons who agreed in the Articles of Association to take shares in the company.
(b) In the case of a company other than a public company, and in circumstances other than those specified in subsection (a), shares may be allotted by the Board of Directors where the allotment is authorised by a resolution of the members and is permitted by this Act and the Constitution of the company.
(c) Nothing in subsection (b) prevents the Constitution of a company from prescribing particular procedures or requiring the approval of the members for the allotment of shares, provided that such provisions do not contravene this Act.
Section 156 — Consent for Allotment
Overview of the provision
This provision protects someone from an allotment that creates a new obligation to the company or increases an existing one without their written consent. That consent must be obtained, and an allotment made in breach of the requirement is void. The consequence is therefore more than a missing record: the prohibited allotment has no validity under this section.
Provision references
Where the allotment of a share to any person increases an existing obligation of that person to the company or creates a new obligation, the written consent of that person must be obtained. An allotment made in contravention of this section is void.
Section 157 — Recording in the Register of Members
Overview of the provision
This provision requires the members' register to be updated for a section 155 allotment, a shareholding change under section 163 or a transmission under section 167. The register must therefore reflect each of these different ways in which a person's shareholding can change.
Provision references
Where shares are allotted under section 155 of this Act, the shareholding of a member changes under section 163, or shares are transmitted under section 167, the change must be entered in the Register of Members maintained under section 81 of this Act.
Section 158 — Consideration for Allotment
Overview of the provision
This provision normally gives the board the task of fixing what is provided in exchange for an allotment, unless the constitution says otherwise. That consideration can take forms including cash, promissory notes, service contracts, property or other company financial products. The Act therefore does not confine allotment consideration to an immediate cash payment.
Provision references
Unless otherwise provided in the Constitution of the company, the consideration for the allotment of shares shall be determined by the Board of Directors. The consideration may consist of cash, promissory notes, service contracts, property or other financial products of the company.
Section 168 — Notification of Share Changes to the Registrar
Overview of the provision
Notifying the Registrar
This provision requires the Registrar to be notified within 15 days of an allotment, transfer, transmission or other change to the members' register, with the relevant persons' particulars submitted for the official register. The submission must include the newly registered member's details and consent; a transfer also requires the transferor's details and transfer instrument. Other prescribed information must be provided too. When the requirements are satisfied, the Registrar must register the change and notify the company.
Corrections and late filing
The Registrar may require a submission believed to conflict with the Act, regulations or articles to be corrected and resubmitted within the reasonable regulatory period. Non-compliance with the section's requirements or periods by the company or a director is an offence under Chapter Fifteen. However, a late initial notification does not alone invalidate a register change otherwise made under the Act and articles. The company's underlying change and its later notification to the Registrar are therefore distinct steps.
Provision references
(a) The Registrar must be notified within 15 days of— (1) any allotment of shares under section 155 of this Act; (2) any transfer of shares under section 163 of this Act; (3) any transmission of shares under section 167 of this Act; or (4) any other change made to the Register of Members. The particulars of the persons concerned must also be submitted to the Registrar for registration in the register specified in section 231 of this Act.
(b) A submission under subsection (a) must be accompanied by— (1) particulars of the newly registered member and that member’s consent; (2) in the case of a transfer under section 163 of this Act, particulars of the transferor and the instrument of transfer; and (3) any other information prescribed by regulations made under this Act.
(c) Where a submission is made in accordance with subsections (a) and (b), and the requirements of this Act are fulfilled, the Registrar shall register the change in the register specified in section 231 of this Act and notify the company accordingly.
(d) Where the Registrar has reason to believe that a submission made under this section contains any matter that conflicts with this Act, regulations made under it or the Articles of Association of the company, the Registrar may direct the company to rectify the matter and resubmit it within such reasonable period as may be prescribed by regulations made under this Act.
(e) Where the company or any of its directors fails to comply with the requirements or periods specified in this section, an offence is committed and action shall be taken in accordance with Chapter Fifteen of this Act.
(f) A failure to comply within the period specified in subsection (a) does not, solely by reason of that failure, invalidate a change made to the Register of Members. Where the change has been made in accordance with this Act and the Articles of Association of the company, the change remains valid.
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.