October was a significant month in the Indian Ocean as the Seychelles and Mauritius both secured their removal from key global ‘blacklists’ after making concerted efforts to bring their legislation fully into line with international standards. This means both jurisdictions can expect a substantial boost in business promotion and tourism over the next couple of months, said Sovereign Trust (SA) Limited Director, Coreen van der Merwe.
The news is of particular interest to South African investors, who are increasingly being attracted by the range of incentives available in Mauritius that make it cheaper and easier for investors and expatriates to live and work there. There is a dynamic and growing community of expatriate South Africans on the island.
The Seychelles was added to the European Union’s list of ‘non-cooperative jurisdictions for tax purposes’ – the so-called ‘blacklist’ – last February, when it failed to meet the EU’s tax transparency criteria of being ranked as at least ‘largely compliant’ by the OECD Global Forum regarding the exchange of information on request.
Mauritius was then also placed on the EU blacklist last October after the FATF, the global money laundering and terrorist financing watchdog, moved the island onto its own ‘grey list’ of countries subject to increased monitoring having identified strategic deficiencies in its Anti-money Laundering and Counter-terrorism Financing (AML/CFT) framework.
Both islands have worked extremely hard to bring their regulatory frameworks into line with fast-changing international standards and secure their removal from these lists at the earliest possible opportunity. The ‘whitelisting’ of Mauritius by the FATF means that its removal from the EU blacklist should now be imminent.
From a business perspective, there are three types of Mauritius companies that can be set up: the global business company, the authorised company and the domestic company. “It’s important to understand the differences between the three types of companies before you start setting up your business in Mauritius. You should take expert advice from companies who already have a footprint in Mauritius, and can guide you through the incorporation process, opening of Mauritius bank accounts, accounting and residency permits for employees to be relocated to Mauritius,” said van der Merwe.
Last year, Mauritius halved the minimum investment required to acquire an occupation permit as an investor and live in Mauritius as a non-citizen from USD100 000 (MUR1.7 million) to USD50,000. The validity of an occupation permit has also been extended from three to 10 years, and spouses of occupation permit holders will no longer require a separate permit to invest or work in Mauritius. The holders of occupation permits will also be allowed to bring their parents and dependents under 24 to live in Mauritius.
“The changes to the requirements for the various permits and acquisition of land are clear incentives to make Mauritius more attractive to prospective investors, talented individuals and expatriates wishing to base themselves in Mauritius,” said van der Merwe. “Now that the cloud of the grey list has been lifted, we expect to see more South Africans streaming to the island, both to live and work.”