First, some background:
On March 19, 2012, the First Secretary (Political) of the South African High Commission in Mauritius, Ivan Vosloo, wrote a note to our Minister of Finance (and deputy PM), Xavier Duval. In this note, Mr Vosloo showed tables that revealed a dramatic drop in the number of Residence Permits held by South Africans.
Unfortunately I don’t have a copy of this note, but the numbers revealed a drop from about 1 300 permits to about 380.
Xavier Duval took immediate action and the result was a forum hosted by the Board of Investment (BOI), inviting South African permit holders and other interested parties to meet with Ivan Vosloo, Ken Poonoosamy (MD, BOI) and Carole Rehaut (Manager International Business Services).
The forum was held on two days with invitees given the choice of which one to attend. The first was on Friday 13 April and the second on Monday 16 April. Superstition forced me to attend the Monday meeting. I was very impressed at the can-do attitude of Mr Poonoosamy and his team, and I am filled with excitement that Mauritius is keen to attract intellectual and financial capital from South Africa. More keen than they have seemed in the past.
I have tried to summarise the key points gleaned from my attendance and also from conversations with others who attended the Friday meeting. If I have left out anything or got something wrong, please post a comment to this effect.
Permanent Residence Permits
Permanent Residence Permits (PRP) are not permanent and should be renamed.
A view was expressed that expatriates holding three year occupation permits and running their own businesses have a high level of insecurity as renewals are not guaranteed, and criteria keep changing.
Mr Poonoosamy gave the message that once you have a PRP you are safe for ten years. The BOI will have no further interest until it comes time for renewal. Except for retirees. They need to bring the $40 000 into the country for their subsistence each year. Lump sum transfers will be considered, but don’t get clever and send the funds straight out again.
I asked if applicants for Occupation Permits (OP) were subject to minimum salary / turnover / investment amounts as well as a subjective evaluation based on the type of activity proposed. We got a bit of a mixed answer here. Firstly, the BOI discretionary committee seems to have been done away with. Mr Poonoosamy said that the BOI realised it was not up to them to evaluate whether a proposal had a good chance of failure or not. It was the investor who took the business risk. Good so far. Then someone asked why their application to start a Scuba Diving Operation had been stifled. Mr Poonoosamy’s reply was that it was up to the Tourism Authority to vet that type of application and report back to the BOI. Mr Vosloo said it was normal for any country to regulate professionals via internal professional structures. So the bottom line is that if you can achieve the minimum financial targets, you may also have to jump over a few more hurdles, depending on what you are planning to do.
Citizenship by naturalisation can be considered after you have been resident in Mauritius for five years in a row. The word Continuous in the law came under discussion and Ken Poonoosamy told us that if a non citizen were resident in Mauritius for an aggregate amount of 182 days in any year and was in possession of a tax residency certificate to this effect, that an application could be submitted for citizenship. In addition to the time test, the Prime Minister’s Office would also like to have evidence and third party references to attest to the fact that the individual has made a significant contribution to the country. Mr Poonoosamy pointed out that the processing of Citizen applications was the responsibility of the Prime Ministers’ Office but that the BOI could help with the submissions relating to economic contribution. It should be noted that granting citizenship by naturalisation is discretionary.
The following Residence Permit Holders (including PRP Holders) need to apply for work permits (if they want to work) subject to the same standards as those applying for Occupation Permits under the categories of Employee, Professional or Investor:
- Spouses of all permit holders including holders of Retirement and Permanent Residence Permits
- Children over the age of 18
- IRS and RES occupiers
Attendees suggested that Mauritius could benefit from a relaxation of these criteria. IRS and RES owners who clearly have already invested a fair amount in the country should be able to work, invest and grow the economy as they see fit. There is also a large untapped pool of entrepreneurial and intellectual capacity being wasted by making it difficult for spouses to get work permits.
Children over the age of 18 starting out in their lives find it difficult to achieve the required minimums. If the child can’t stay, sometimes the whole family leaves, along with its investment, capital and jobs created.
It was a concern that expatriates must pay more for their children in private schools than locals. Some believe it is in contravention of Mauritian law. When we arrived in Mauritius and were struggling to establish ourselves, discriminatory school-fees really upset me.
Registration Fees for IRS and RES
It costs $75 000 to register an IRS and $25 000 to register an RES, regardless of the total value. Mr Poonoosamy said that they were aware of the inconsistency and a possible change might be seen after the next budget.
This was probably the most emotive issue expressed by the Expats present. Many said that the possibility of purchasing an apartment held no value to them as they were used to living in large houses, and in any event there were few of these on the coast where they preferred to live. They expressed the need to be able to purchase or build houses to their own taste and budget, rather than have to take what was on offer via RES or IRS.
It was asked if apartments on State Land (beachfront) would be available to PRP holders. Mr Poonoosamy said that this would not be the case.
Existing Apartments with a Foreign Interest
It was asked whether apartment schemes on State Land that could have a foreign interest were legal. Mr Poonoosamy said that such schemes were illegal. He was then asked if existing schemes were illegal and he said that these schemes were set up using loopholes in the law. The loopholes were now closed but that the schemes that had come into existence before the law changed would have to be accepted