As an organization advocating for local empowerment and entrepreneurship in tourism industry, the issue of foreign Online Travel Agents (OTA) acting for and on behalf of off-shore businesses, has been a challenge that we prioritized to address for years. Travel industry is sector frequented by such undocumented and unmonitored agents and agencies, who stand in the way of competitive and fair market growth for local businesses.
Today we see globally, various government acting against such businesses. Hotel rates all over the world are being affected by Airbnb pricing them out, as most are not complying with the required regulations and the taxes. Now a number of countries have started tightening up, Example : New York City Airbnb hosts soon will need to register their homes as rental properties; Japan Airbnb listing must now abide by the same safety rules as hotels; Berlin has a strict set of rules for Airbnb ; Paris Airbnb hosts can now only rent their homes for 120 days per year ; Sydney Airbnb new rules imposed to clamp down on parties in short term rentals.
In Maldives many expats can make money out of a vacant room in their apartment on Airbnb, which the government doesn’t get any tax revenue and isn’t monitored for safety concerns.
Also, as deliberated earlier in various forums by MATATO, Foreign Representative Offices in Maldives who operate on behalf of off-shore travel agencies, are one of the primary concerns expressed by MATATO members. Representative offices registered for limited operations are believed to be exempt from proper tax payments, obligations, and liabilities which are directed under trade regulations for the tourism industry.
However, under the guise of representative offices, off-shore travel agencies are efficiently conducting business in the local tourism market, making direct purchases, and selling Maldivian holiday products while enjoying the same privileges as local travel agents and tour operators. This not only creates an unfair business environment for Maldivian travel companies, but also diverts a concerning share of inbound travel revenue to foreign agencies.
Local travel agent’s industry needs to be a protected industry and government should not allow foreigners to operate in this area.
