Senators in Palau have rejected a bill that would have designated the island of Ngemelis as a national heritage site.
The heritage site bill introduced by President Tommy Remengesau would also have prohibited fishing at or near designated dive sites at Ngemelis.
The bill states that current law negatively affects Palau's dive industry by reducing the amount of marine life at dive sites, overcrowding the dive areas and possibly jeopardising the safety of divers.
Meanwhile, a bill seeking to impose a sales tax on goods and services was also rejected.
The sales tax was recommended by the 2007 Tax Review Task Force.