A clause has been included in the Real Estate Business Bill whereby the maximum number of years a plot in the Integrated Real Estate Zone can be leased for is 99 years.
According to the bill submitted to the Parliament on behalf of the government, an Integrated Real Estate Zone can only be declared under a development project that has a masterplan with an investment of a minimum of USD 1 billion.
The zone can include an island, lagoon or an area containing a land plot and a lagoon. The zone can only be determined by the President.
The bill reads that the Integrated Real Estate Zone can only be leased for a maximum of 99 years. The bill also states that properties in the zones can be sold under leasehold rights for a period of 99 years under a surrender and regrant model.
A zone can be leased to a master developer by announcing a public tender, via proposals submitted within the government's economic policies or to a State-Owned Enterprise (SOE) according to the President's decision with the recommendation from the Cabinet.
The bill states that the lump sum that is paid as land premium, or 10 percent of revenue through sale of the land, and 10 percent from land lease and a percentage from business profits can be taken by the State. Additionally, when a property is being sold, four percent of the sale price must be given to the authority as a transfer fee.
The bill further reads that citizens from one nation or companies in which citizens of that nation hold a stake can only own up to 25 percent of the total properties that are developed across the zone.
Under the Maldives Immigration Act, those who are prohibited to enter Maldives, litigants who are a part of an international court case and those who have an arrest warrant in their name from international courts cannot purchase, lease or exchange properties in the zone.
If a property is purchased fraudulently or with false information, the transaction will be voided, and the authority will have the choice of issuing a fine up to 50 percent of the transaction, the bill reads.
According to the bill, the establishment and maintenance of basic services such as roads, electricity, water and sewerage, waste management and transportation system is the responsibility of the master developer. The developer will have the right to issue a "Usage Charge" via a special bank account to set charges for the services.
A designated number of Maldivians must be employed at all of the projects and businesses in the zone. It will be illegal for any business or activity deemed forbidden under Islamic Shariah to be operated in the zone.
