The Maldivian government has introduced an amendment to the Companies Act aimed at shortening the notice period for Extraordinary General Meetings (EGMs) from 21 days to just 10 days. The proposed bill, sponsored by Feydhoo MP Ismail Nizar, is currently under review by the Parliament’s Economic Committee.

The bill was presented during an extraordinary parliamentary sitting last week, and was further discussed in a subsequent session on Monday morning. The proposal seeks to streamline the process for convening EGMs by requiring companies to issue notices within three days of receiving written requests and to hold the meeting within 10 days.

Under the current law, companies are required to provide 21 days' notice for EGMs and can schedule the meeting within three months of receiving such requests.

The push for this legislative change comes in response to the Bank of Maldives (BML) needing to hold an EGM on September 21, following instructions from the Finance Ministry to approve changes to its board. Deputy Speaker Ahmed Nazim, who represents Dhiggaru, emphasized the urgency of the amendment, citing the resignation of BML’s CEO Karl Stumke on September 8. He argued that the shortened notice period would facilitate quicker decision-making, allowing for the appointment of a new CEO and improving efficiency in other companies as well, such as the State Trading Organization (STO) during its takeover process of Fenaka Corporation.

In addition to the shortened notice period, the bill includes provisions to allow both public and private companies to increase their board of directors. If a board determines that the number of directors is insufficient, it can appoint new directors within 10 days to reach the desired number.

The amendment is anticipated to enhance corporate governance and operational efficiency across various sectors in the Maldives.