New Foreign Investment Entry Requirements Published

The Ministry of Economic Development and Trade (the “Ministry”) has published the new Foreign Investment Entry Requirements on 8 October 2025, under the Foreign Investment Act ¹(the “FI Act”). The new Entry Requirements revise sector classifications, investment thresholds and foreign shareholding limits across multiple business sectors.

Sector-Specific Restrictions
Under the FI Act, foreign investments remain subject to sector-specific restrictions. To obtain a foreign investment licence, the proposed business sector of the foreign investment must either be:

Open for foreign investment; or
Open for foreign investment subject to conditions/restrictions.

The new Entry Requirements published by the Ministry introduce material changes in several sectors that will affect market entry and transaction structuring for investors considering investing in Maldives.

Some of the major changes include:

Entry requirements for the core tourism sectors remain broadly unchanged
Entry requirements for real estate development activities are tightened, with more granular sub-categories narrowing access for smaller projects
Additional restrictions are imposed on the construction sector with permitted contract values increased significantly
Significant restrictions are introduced for transportation and logistics sector
Investment thresholds are reduced for the financial services and insurance sector
A specific business activity is introduced for renewable energy projects
Maximum foreign shareholding is decreased for dive centres and dive schools
Franchising restrictions are eased with location-based limits removed
The general prohibition on wholesale and retail sector is maintained

Transitional provisions for existing businesses
As the foreign ownership limitations, rules and conditions outlined in the new Entry Requirements published by the Ministry are set to take immediate effect, the new changes will significantly impact existing foreign investment entities currently operating in the Maldives.

To facilitate compliance for such existing investors, the Ministry has published transition arrangements. A summary of the key provisions is provided below.

1. Validity of existing Foreign Investment Agreements
Foreign investment entities with valid Foreign Investment Agreements may continue operating in the Maldives until the expiration of their current Foreign Investment Agreements.

To continue operations beyond the expiry, entities must restructure to comply with the new foreign ownership limits and other related conditions.

2. Application for a transition period
Foreign investment entities operating in newly restricted sectors that require additional time to either wind down operations or restructure in line with the new rules may apply to the Ministry for an extended transition period.

3. Sector-specific transition periods and rules
The Ministry has issued sector-specific transition rules for affected foreign investment entities. The Ministry asserts that these periods have been determined based on:

1. Sector of operation;
2. Nature of the project; and
3. Scale of the investment.

The Ministry has provided 1-year transition periods for business sectors that are primarily service-based, and for other business sectors that the Ministry does not consider to be capital-intensive.

Residential real estate projects will be granted a transition period equal to the remaining durations of their active projects (aligned with the relevant project agreements).

In sectors that the Ministry considers to be capital-intensive, transition periods have been granted as follows:

Scale of Investment	Transition Period
Less than USD5,000,000	3 years
Between USD5,000,000 and USD10,000,000	5 years
Greater than USD10,000,000	7 years

The Ministry has also stated that verified investments substantially in excess of USD10,000,000 may be granted transition periods exceeding 7 years at the Ministry’s discretion.

A complete list of sector-specific transition rules and timelines can be accessed here.

4. Foreign Investment Transition Committee
The Ministry will establish a Foreign Investment Transition Committee (the “Committee”) to determine applicable timelines and the scope of operations eligible to be granted transition periods as stated above.

5. Application review process
Applications for transition periods will undergo the following review stages:

1. Preliminary Assessment: The Ministry will check the completeness of the application, conduct tax and regulatory compliance checks, and prepare a summary report for the Committee.
2. Committee Review: The Committee will vet the summary report, request further documents or invite an applicant presentation if needed, and issue a decision based on the sector, investment scale, and commitments stated in the published sector-specific transition rules.
3. Outcome: Once the Committee has made a decision, and if the application has been approved, the Ministry will issue a Transition Arrangements Letter to the applicant detailing the transition period granted to the applicant; and any conditions applicable to the continuation of their business during the transition period.

The Ministry asserts that the review process will be completed for all complete applications within a maximum of 60 days.

6. Appeals and re-evaluation

Applicants dissatisfied with the Committee’s decision may submit a request for re-evaluation with additional documentation or representation.

Effective Date

The new Entry Requirements came into effect on 8 October 2025.