Parliament passes new amendments to Sole Proprietorship Act, increases fine for violations

Parliament, on Monday, has passed the government-proposed bill to amend the Sole Proprietorship Act was submitted by Kurendhoo MP Abdul Ghanee Abdul Hakeem.

The bill was passed by the unanimous vote of the 53 parliamentarians who were present for the voting. No bill was passed as it was proposed by the government, without any revisions.

According to the bill, its purpose is to remedy the difficulties currently faced by sole proprietors as well as to create ways how the statuses of sole proprietorships can be identified and monitored more easily. Another purpose mentioned in the bill is to ensure that the economic opportunities available for small and medium businesses are not constrained.

The bill passed today stipulates the circumstances under which the cancellation of permits of businesses are allowed should the business be carried out for a foreigner to heed profits from it, although registered to a local.

In this regard, if the registrar is provided evidence that the business is carried out to directly or indirectly profit a foreigner, the business permit may be canceled.

It also stipulates that if a sole proprietor lives abroad, a Maldivian must be appointed to be responsible for the operations of the business.

Prior to this, sole proprietorships are registered for a period of 5-years. The amendments passed today proposed to extend this period to 10-years. In addition to this, the 90 days previously allotted to carry on with business operations following the expiration of this period, has now been changed to one year.

Moreover, the amendments passed today also include increasing the fine amount for those who violate provisions of the Act. Previously, the fine was set at MVR 20,000. The amendments passed today increased this amount to MVR 100,000.