Mauritius: Fundamental Reform In Business Facilitation And Expansion Of Economic Horizons In Mauritius

The Business Facilitation (Miscellaneous Provisions Act), 2017, enacted on 16 May 2017, aims to give new impetus to investment by creating a more favourable environment to doing business in Mauritius. It seeks to do away with regulatory and administrative constraints (whether at the outset or on an ongoing basis), and promotes a modern and digital business environment by bringing significant amendments and innovations to 26 pieces of legislation. Below is an overview of those legal changes that we deem notable.

Pushing the agenda of simplifying the setting up of businesses, the amended Limited Liability Partnerships Act, the Limited Partnerships Act and Foundations Act seek to shift the power at the time of registration from the relevant Minister to the Registrar of Companies, purporting again to expedite the process of starting any business and corporate structure. In a similar vein, the requirement to have a seal is no longer a prerequisite to registering a company under the Companies Act and the Foundations Act. The Registrar of Companies will issue an electronic Certificate of Incorporation within one working day (e-Certificate of Incorporation), the signed copy having now become optional.

Another welcome improvement to the Investment Promotion Act relates to the introduction by regulations of an e-licensing system for the online submission of applications for licences, clearances and authorisations (excluding permits for the import and export of goods), bringing the application process into the digital age.

Amendments to the Civil Code, Inscription of Privileges and Mortgages Act, Transcription and Mortgages Act, the Sale of Immovable Property Act and the Registration Duty Act now provide for a standard form to accompany deeds presented for registration, transcription or inscription at the Registrar General. Going forward, charge documents, documents witnessing sale or transfer of immovable property, crédit-bail or seizure must be accompanied by a prescribed form summarising the salient features. The advent of such a procedure aims to standardise, facilitate and speed up the process of registration at the level of the Registrar General, doing away with elaborate and time-consuming administrative procedures at the level of the Registrar.

Changes to the Notaries Act aim to streamline the process to register a property in Mauritius and propose the possibility, through the Mauritius e-Registry Platform, to carry out online searches on immovable properties.

To pursue the simplification of business and tax administration, the Income Tax Act now allows businesses to pay their social contributions (the National Pension Fund, National Savings Fund, and the recycling fee under Employment Rights Act) directly to the Mauritius Revenue Authority, which will, going forwrd, act as a single collecting agent for social contributions.

In terms of industry-specific changes, notable changes for the construction industry include:

  • applications for a building and land use permit ("BLUP") under the Local Government Act can be submitted at the respective local authority electronically. Businesses are no longer required to produce their business registration cards and clearance certificates from the Central Electricity Board, Central Water Authority, Wastewater Management Authority and Fire Services prior to applying for a BLUP.
  • the Environment Protection Act reduces the time set for submission of the outline of an undertaking by a proponent (developer) from one month prior to submission of the environmental impact assessment ("EIA") application, instead of three months. Another novelty is the time frame of a two-week delay within which the Director of Environment must impose the terms of reference for the EIA report, the fields of study that are required to be covered, and the levels of expertise and qualifications of the consultants signing the report. These measures will help in the assessment of EIA reports and expedite the determination process.
  • the Local Government Act now provides that where no BLUP or regulatory licence is required, businesses will be able to start their operations immediately after registration of the business activity with the Corporate and Business Registration Department. Also, the time frame for a local authority to issue an occupation certificate is being reduced from 10 days to five days.
  • under the new Morcellement Act, the time frame for the Morcellement Board to forward its recommendations to the relevant Minister to determine an application for a Morcellement Permit for projects holding a preliminary environment report or an EIA licence is reduced to three weeks, thereby expediting the determination process.

Heralding more transparency and accountability, the Insolvency Act has been amended to introduce the regulation of fees payable to a receiver in insolvency proceedings. Like liquidators, receivers are now entitled to charge, as fees, a capped percentage of the amount recovered through the disposal of assets. This amount will be prescribed by law. Insolvency practitioners are also liable to sanctions by the Director of Insolvency in the event that they fail to comply with a request of the Director of insolvency. The Mauritius Standards Bureau Act, which promotes standardisation and quality assurance in industry and trade, now classifies some goods as "controlled goods" (for eg, cement, outboard motors) and tabulates, in statute, the conditions under which such goods should be imported. Businesses importing such goods now have to apply and obtain an electronic conformity report prior to undertaking the imports.

This article was reviewed by Martine de Fleuriot de la Colinière, a director at ENSafrica in Mauritius.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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