President Dr. Mohamed Muizzu has officially ratified the 15th amendment to the Maldives Tourism Act, following its approval by the People’s Majlis on March 19, 2025. The amendment marks a significant transformation in the legal and financial structure of the tourism sector, introducing a dedicated Tourism Trust Fund to replace the existing one governed under the Public Accounts Act.
The amendment bill, which underwent extensive deliberations within the Parliamentary Committee on Economic Affairs, was passed with 55 votes in favor against seven opposing votes. The bill was introduced by Ahmed Riyaz, the representative for Thimarafushi from the ruling People’s National Congress (PNC). While the opposition Maldivian Democratic Party (MDP) suggested modifications to the bill, these proposals did not secure sufficient support in Parliament.
A key component of the amendment is the restructuring of policies regarding the allocation of islands, land, and lagoons for tourism development through cross-subsidy. It also establishes revised guidelines for lease extensions, redevelopment of tourism establishments, and land use for tourism within inhabited islands and urban areas. Under the new law, such developments must align with existing urban plans, while the President retains the authority to allocate uninhabited islands and lagoons for tourism projects, limited to guesthouses and hotels.
The amendment introduces a structured framework for resort lease extensions, stipulating a maximum extension period of 49 years upon payment of a lease renewal fee. Additionally, allocations for resort development under the cross-subsidy model must be in line with national economic and social policies to maximize benefits for the country.
A central feature of the amendment is the establishment of the Tourism Trust Fund, designed to support the sustainable growth of the industry through a structured financial mechanism. The existing funds currently managed under the Public Accounts Act will be transferred to this new trust, ensuring seamless continuity and financial stability. The fund will be overseen by a management committee comprising representatives from the Ministry of Tourism, the Ministry of Finance, and key industry stakeholders. Contributions to the fund will include sponsorships, corporate social responsibility (CSR) contributions from tourism operators, and proceeds from investment activities aimed at sectoral growth.
Furthermore, the revised legislation introduces new compliance measures for tourism projects, granting the President the authority to allocate uninhabited islands and lagoons for development while ensuring alignment with national planning strategies. In contrast, local councils will continue to oversee tourism-related land use in inhabited areas, reinforcing localized governance within a structured national policy framework.
To ensure effective regulatory oversight, the Ministry of Tourism and Environment has been tasked with managing the closure and redevelopment of tourist establishments, implementing a new set of safety and operational standards, and overseeing advertising regulations for tourism services. Establishments undergoing redevelopment must comply with strict lease agreement terms, with failure to meet the requirements potentially leading to lease cancellations without compensation.
With the amendment now ratified and published in the government gazette, the law has officially come into effect, heralding a new phase of strategic planning and financial management in the Maldives’ tourism sector.
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