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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The former Act was repealed, existing companies continued, and transition periods did not preserve inconsistent constitutional provisions indefinitely.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.
Increase and reduction of share capital
Capital increases and reductions require special resolutions, while reductions add a creditor-objection stage before registration.
Explanation and core rules
A special resolution authorises an increase. A reduction requires excess capital, no prejudice to other rights and a special resolution. The Registrar publishes a reduction notice allowing at least 30 days for objections. The alteration must be notified within 30 days with the section 154 bundle. Late notification does not alone invalidate an otherwise valid alteration, but company and directors may commit offences.
Step-by-step procedure
- Analyse capital, solvency, creditor and class-right impacts.
- Pass the special resolution.
- For a reduction, submit for public notice and manage objections.
- Update constitution/registers where required.
- File the alteration within 30 days and verify registration.
Documents and evidence
- Capital analysis
- Special resolution
- Creditor/member notice record
- Statement of compliance for reduction
- Updated capital/register documents
- Registrar receipt
Points requiring care
Particular care is needed to avoid implementing a reduction before the objection process and registration are complete, as well as increasing authorised/issued capital without separately completing allotment mechanics.
Related Act provisions
Section 152 — Increase of Capital
Overview of the provision
This provision enables a company to increase its share capital by a special resolution of the members. It identifies the required level and source of approval for the increase, which must be considered alongside the Act's associated filing requirements.
Provision references
The share capital of a company may be increased by a special resolution of the members.
Section 153 — Reduction of Capital
Overview of the provision
This provision permits a special-resolution reduction where capital exceeds the company's requirements, provided no other person's rights are prejudiced. When the reduction decision is submitted, the Registrar must publish a notice allowing creditors, members and other interested people at least 30 days to object. If no objection is lodged within that period, the reduction is registered under section 154. Member approval therefore operates alongside an opportunity for affected people to object.
Provision references
(a) Where a company has capital in excess of its requirements, its share capital may be reduced in accordance with this section by a special resolution of the members, provided that the reduction does not prejudice the rights of any other person.
(b) Where a decision of the members to reduce the share capital is submitted to the Registrar under subsection (a), the Registrar shall publish a notice inviting any creditor, member or other interested person to object to the proposed reduction. The notice shall allow a period of not less than 30 days for objections to be made.
(c) Where no objection is submitted to the Registrar within the period specified in subsection (b), the reduction of share capital shall be registered in the register in accordance with section 154 of this Act.
Section 154 — Notification of Capital Alteration to the Registrar
Overview of the provision
Applying to register a capital change
This provision requires a capital alteration under section 152 or 153 to be notified within 30 days, with an application for registration under the regulations. The company must include the special resolution, particulars of the alteration, the Schedule 1 fee and other prescribed information; a reduction also requires the section 228 compliance statement. If the requirements are met, the Registrar must register the alteration and notify the company.
Corrections and legal effect
The Registrar may direct correction and resubmission of an application believed to conflict with the Act, regulations or articles, allowing the reasonable period prescribed by regulations. Failure to meet the initial requirement or correction deadline is an offence by the company and every director under Chapter Fifteen. A late initial submission does not alone invalidate an alteration otherwise made in accordance with the Act and articles. The capital decision and compliance with its filing duties must therefore be assessed separately.
Provision references
(a) Where an alteration is made to the share capital of a company under section 152 or 153 of this Act, the company must notify the Registrar within 30 days of the alteration and submit an application for registration of the alteration in the manner prescribed by regulations made under this Act.
(b) An application under subsection (a) must be accompanied by— (1) the special resolution containing the decision of the members to increase or reduce the share capital; (2) particulars of the alteration made to the share capital; (3) where the application relates to a reduction of share capital, the statement of compliance specified in section 228 of this Act; (4) the fee prescribed in Schedule 1 to this Act; and (5) any other information prescribed by regulations made under this Act.
(c) Where an application is submitted in accordance with subsections (a) and (b), and the requirements of this Act are fulfilled, the Registrar shall register the alteration to the share capital of the company in the register specified in section 231 of this Act and notify the company accordingly.
(d) Where the Registrar has reason to believe that an application submitted under this section contains any matter that contravenes this Act, regulations made under it or any provision of the Articles of Association of the company, the Registrar may direct the company to rectify the matter and resubmit the application. The company shall be given a reasonable period, as prescribed by regulations made under this Act, within which to rectify and resubmit the application.
(e) Where a company fails to comply with subsection (a) within the period specified in that subsection, or fails to rectify and resubmit an application within the period specified by the Registrar under subsection (d), an offence is committed by— (1) the company; and (2) every director of the company. Action shall be taken against such persons 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 an alteration to the share capital of the company. Where the alteration has been made in accordance with this Act and the Articles of Association of the company, the alteration 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.