The government’s effort to improving the business environment in Mauritius
Throughout the past year, the government of Mauritius has implemented several regulations and new laws to attract investors to Mauritius. Several of them are dedicated to improving the business environment in the country. As such, it is going to be easier to establish and operate a business. Some of the measures are discussed below.
- August 13, 2020
- Posted by: DeenE
- Categories: companies act, Listing, Mauritius, Securities Act
Protection of minority investors
Protecting minority investors has been a priority for the government. To improve the safety net for them, it has taken into consideration recommendations of the World Bank and has introduced the following measures.
- The Securities Act will be amended to ensure that the public is immediately informed if a transaction has a value of at least 10% of the Company’s assets.
- The Companies Act will also be amended. Individual compensation of directors are disclosed in the annual report.
- Moreover, the Companies Act will be amended such that dividend declared by the Board is paid within a maximum period of 15 months subject to solvency test.
- The Companies Act will also cater to the disqualification of a director upon a successful claim by shareholders.
- The Listing Rules will be reviewed to provide for the requirement of obtaining shareholders’ approval for Related Party Transactions, where the percentage ratios as specified in the Rules, represent 10% or more.
To solve any issues that many arise when an entity cannot raise enough cash to meet its obligations, or to pay debts or when the value of an entity’s total assets exceeds its total liabilities, the Insolvency Act will be amended. It will allow an administrator to call separate meetings for different classes of creditors. The creditors are going to vote separately and the Administrator shall ensure equal treatment for each class. Moreover, the Administrator is going to ensure that creditors are not worse off than they would have been in a liquidation.
Sharing of information to expedite Doing Business
The Electronic Transaction Act will be amended to
- → include the possibility of sharing information electronically between public sector agencies, public agencies and authorised institutions that are listed in the schedule to the Act and
- → use InfoHighway for the sharing of company information with all licensed commercial banks to facilitate due diligence requirements.
Moreover, the Civil Status Act will be amended to expand the nature of information which can be shared between the entities.
Business-Related Rule Making
In September 2019, A Regulatory Impact Assessment (RIA) framework for evidenced-based business related rule making was established. This project is in collaboration with the Organisation for Economic Co-operation and Development (OECD) and it involves a cost of Euro 500,000 which was funded by the European Union (EU).
Expediting Dispute Resolutions
To facilitate the process of expediting dispute resolutions, the Income Tax Act will be amended. Parties attempting a mediation or a conciliation or an arbitration will be allowed a deduction from taxable income of an amount equivalent to 150% of the case filing fee.