MALDIVES Law and Practice Contributed by: Hassan Maaz Shareef, Aminath Amathulla, Aishath Shifala, Mohamed Azmee, Nazahath Ahmed, Maaisha Mohamed Musthafa, Aifa Shareef and Noorul Hudha Ahmed, Premier Chambers LLP
right, whether directly or indirectly, to exert influence and control over the company’s financial and stra - tegic decisions will also be considered a significant beneficial owner. Companies are required to submit details of the signif - icant beneficial owners to the Registrar of Companies within 30 days of receiving the information. 3.4 Management Structures Private Companies Private companies registered in the Maldives are managed by their boards of directors. All companies have to appoint a managing director from among their directors. The managing director will be a full- time officer of the company and will be responsible for its management under the guidance of the board of directors. The directors may delegate their powers, duties and responsibilities to a director’s committee, an individual director or an employee of the company, as deter - mined by the board of directors, provided the delega - tion is not prohibited by the company’s constitutional documents. Even with the delegation of powers, the directors will remain accountable for the actions of In all partnerships registered in the Maldives, a man - aging partner has to be appointed. The managing partner is responsible for managing and overseeing all matters relating to the partnership according to the partnership agreement. 3.5 Directors’, Officers’ and Shareholders’ Liability Companies registered in the Maldives acquire a legal personality upon registration, distinct from that of their members, directors and officers. However, this is not absolute and the Companies Act states that if the company has committed a fraud and dishonest action and if the shareholders, directors or officers of the company have used the company for personal gain, the corporate veil of the company may be pierced and the shareholders, directors and officers of the com - pany may be held personally liable. the delegate. Partnerships
Specific responsibilities are imposed on the directors of a company under the Companies Act. If the direc - tors fail to comply with them, they commit an offence and can be penalised. There is an obligation on shareholders to disclose details of beneficial owners and if they fail to do so, they are considered to have committed an offence and can be penalised. The Companies Act recognises situations in which a company will be considered to be committing a crimi - nal offence. These circumstances arise when the com - pany submits false information, submits forged docu - ments to the Registrar of Companies or obstructs an inspection conducted by the Registrar of Companies or someone delegated by the Registrar of Companies. The Employment Act of the Maldives (Law 2/2008) (the “Employment Act” as amended) is the law that determines the fundamental principles relating to employment in the Maldives, as well as the rights and obligations of employers and employees and all other employment-related matters. The Employment Act applies to both private and public sector employees. The Employment Act states that it will not apply to any other persons exempted from it by any other statute. At the time of writing, the only parties exempted from it are the police and armed forces. Other related laws Other employment-related laws are as follows. • The Industrial Relations Act of the Maldives (Law 1/2024) (the “Industrial Relations Act”). This Act lays out a detailed framework for the formation of trade unions and employer organisations par - ticipating in such unions, as well as for mediation between workers, employees and employers. It applies to both public and private sector employ - ees and employers, except for the parties exempt - 4. Employment Law 4.1 Nature of Applicable Regulations Laws Employment Act
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