THE FIRST AMENDMENT TO THE FX REGULATIONS
After the First Amendment to the Foreign Currency Act took effect on 1 September 2026 and reorganized the Foreign Currency Act (Forex Act), MMA has now brought out the First Amendment to the Foreign Currency Regulations (FX Regulations) to provide clarity on the changes brought about by the Forex Act.
Some notable changes are summarized below:
MMA Approval Process
One of the most notable additions to the Forex Act was the requirement to obtain prior approval from MMA for all FX outflow as payment for supply of goods and services.
The revised FX Regulations now provide for that approval process by adding a new section 2-1 between the already existing sections 2 and 3.
According to the revision, all FX outflow (as payment for goods and services) budgeted for a year ought to be submitted to MMA 30 days before that year begins. Like the budgeted FX outflow for 2027 ought to be submitted to MMA by 30 November 2026.
In case any additional payment ought to be made within the year but outside of the FX outflow approved by MMA for the year, an ad hoc application may be made to MMA for approval of that specific expenditure.
As for the remainder of this year 2026, if any FX outflow (as payment for goods and services) is expected to be made from 10 September to 31 December, the application is to be made within 14 calendar days from the date the FX Regulations were amended, which is 10 September 2026 – so by 24 September 2026.
All applications for approvals ought to be made via the designated MMA FX portal with all particulars and supporting documentation as advised by MMA.
MMA will decide on each application within 14 working days. If the application is rejected, MMA will advise the applicant in writing and state their reasons.
There is also a continuing obligation: the reporting mechanism installed here.
Each applicant whose application is approved by MMA shall report details of FX outflow (between January and June of a year) by 28th July that year, and (between July and December of the year) by 28 January next year.
No MMA Approval Needed
It is to be noted that two types of (otherwise applicable) transactions are now exempted by MMA.
One is that a supplier who supplies goods or services to a business earning foreign currency income is not required to obtain approval from MMA to carry out that transaction / or to accept payment in FX.
The other is any transaction / obligation mentioned in section 2 of the FX Regulations. That includes the following:
- transactions between insurance companies and non-tourism customers in relation to their insurance policies and insurance intermediaries;
- a business and their shareholders such as loans, payment obligations, and FX exchange activities;
- a business and their related parties involving FX exchange activities;
- payment for goods and services supplied to diplomatic missions, multilateral organizations, and associations resident in the Maldives; and
- payments made for scholarships, student loan, and welfare schemes run by a BFCI.
Local Account
Section 4 provides that all deposits required to be made under the Law and the FX Regulations shall be made to a foreign currency account maintained in a bank licensed by MMA.
There can be more than one bank account to make the deposit, but deposits must be made to a single designated account in each bank.
Details of the bank account and the bank ought to be submitted to MMA, and any change in the bank account shall be advised within 7 days of change.
Review Applications
Section 14 speaks of the rules relating to asking for relief or review of the applicable threshold for conversion.
The section also outlines a list of supporting documents that need to accompany any relief application.
The review application must be made at least within three months of deadline for conversion – must provide reasons for the inability to convert and specify a period for which relief is requested, which cannot be more than 6 months.
The provision is also clear that a pending application for relief is not a permissible reason to discontinue or suspend the conversion obligation.
Note:
Please seek independent advice on the scope and applicability of the First Amendment to the Forex Regulations brought into effect on 10 September 2026.
Key:
A mere reference to a section is a reference to a section / provision of the Forex Regulations as amended.
A reference to a business is a reference to a business earning foreign currency income.
