New foreign currency exchange regulations ‘unacceptable’, MATI says

Maldives Association of Tourism Industry (MATI) has raised concerns over the Maldives Monetary Authority (MMA)’s new foreign currency regulations, stating that the association’s objections were not considered in the final version of the regulation.

In a statement issued following the MMA’s press release on Tuesday, MATI emphasised that the proposals presented by the Authority during consultations were “not acceptable” to the association. Despite this, none of MATI’s concerns were addressed when the regulation was gazetted.

MATI expressed disappointment with MMA’s claims that the regulations were formulated following consultations with stakeholders. According to MATI, although a meeting had been held at the request of MMA, the association’s feedback had been disregarded in the final drafting of the regulation.

MATI reassured that it remains committed to cooperating with authorities on issues affecting the country.

MMA on Tuesday introduced a new regulation requiring all foreign currency income generated by the tourism industry to be deposited in local banks.

As per the regulation, businesses active in the tourism industry and registered with the Maldives Inland Revenue Authority (MIRA) are required to re-register with MMA within 30 days. New registrants must also comply with this rule within the same timeframe.

Goods and service providers in the tourism sector are now required to submit details of their offerings to the MMA before the 28th of the following month.

The total foreign currency earnings must be deposited into a local bank’s foreign currency account, registered with MMA, within 87 days after the end of each month.

The regulation also specifies that transactions within the country must be conducted in Maldivian Rufiyaa, with certain exceptions. These include government-related transactions, remittances, foreign transactions, and sales to tourists, among others.

Any transaction made in foreign currency outside of the exempted categories will face fines ranging from MVR 10,000 to MVR one million.

Violations of other clauses in the regulation could also result in fines up to MVR one million.

In a second regulatory change, MMA has amended the Foreign Currency Regulation, requiring tourism facilities to exchange a portion of their foreign currency earnings through local banks.

For resorts, hotels, and tourist vessels (Category A), $500 per guest must be exchanged.

Guesthouses (Category B) are required to exchange $25 per tourist.

Lower exchange requirements are allowed in cases of tax payments in foreign currency, debt repayment, or court-ordered arrangements.