The government has introduced a bill in parliament seeking to amend the Tourism Act to allow resort tenants to extend their leases by paying a reduced fee. The bill was introduced by Member of Parliament Abdullah Rasheed on behalf of the government.
Currently, Section 9(a) of the Tourism Law allows the lessee to extend the resort lease for another 49 years, provided that the lessee meets certain conditions. One of these conditions requires the lessee to make all payments due, including rent, fines, taxes, fees, etc., payable to the government, except those that have been deferred by agreement with the Ministry of Tourism.
The 10th amendment to the law, which will take effect on December 27, 2022, requires resort operators to pay a fee of $5 million for the first two years to extend their leases. Beyond this period, the extension fee will increase to $10 million for a 99-year lease.
The proposed amendment in section 9(a)(2) of the bill seeks to change the payment structure.
- A fee of $5 million must be paid within six months of the effective date of the amendment.
- After the six-month period, the fee will increase to $10 million.
Under current law, the opportunity to extend the resort’s lease for a fee of $5 million expires in December 2024. If the amendment passes, resort operators would be able to extend their leases for an additional six months at a lower fee instead of paying the higher fee of $10 million.
