MALDIVES LAW AND PRACTICE Contributed by: Shaaheen Hameed, Hassan Maaz Shareef, Aminath Amathulla, Nazahath Ahmed, Isha Ali Raoof, Aifa Shareef, Noorul Hudha Ahmed and Mohamed Azmee, Premier Chambers LLP
Private companies These are companies where shares are privately held and the sale of shares to the public is pro - hibited. The minimum number of shareholders in a private company is one and the maximum number is 50. There is no minimum share capital requirement for private companies. Public companies The general public have the right to subscribe to shares, debentures or bonds in publicly traded companies. The number of shareholders in a public company is unlimited. There is also no minimum share capital requirement for public companies. However, if the public company is going to be listed on the Stock Exchange before listing, they must have an issued and paid-up capital of at least MVR10 million. State-owned companies State-owned companies are companies incor - porated under a Presidential Decree or by legis - lation and all the shares are owned by the gov - ernment. Local authority companies Local authority companies are companies incor - porated by local councils to conduct business activities which benefit citizens who are under the regulatory remit of the secretariat. Foreign investment companies Any company where one or more shares are held by a foreign individual or a foreign company or a partnership is considered a foreign investment company in the Maldives. A foreign investment company can be a private or public company. Foreign investment companies are subject to the FI Act. Specific designated sectors are open for foreign investment companies to conduct busi - ness with foreign shareholding of 100%, while
restrictions such as foreign shareholding per - centages apply in other areas. Re-registered companies Foreign registered companies including foreign registered co-operations, charities, foundations and other types of entities can re-register in the Maldives and conduct business operations. Like foreign investment companies incorporated in the Maldives, re-registered companies are sub - ject to the same restrictions regarding the areas in which they can operate. Every re-registered company has to appoint an agent in the Mal - dives who is accountable to the Registrar of Companies in relation to fulfilling all obligations under the Companies Act. In addition, the agent will be personally responsible for all actions taken against the re-registered entity under the Companies Act. Liability of Members of Company The shareholders of the company are only liable towards the company: • to the extent of the value of any unpaid shares held by them; • in a manner clearly specified in the constitu - tional documents of the company; and • any other manner specified in the Companies Act. Directors Only Maldivians are eligible to be directors in companies, with the exception of foreign invest - ment companies, State-owned companies and public companies with government sharehold - ings. At least one director must be resident in the Mal - dives. A person is generally considered to be residing in the Maldives if that person resides
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