The Business Facilitation (Miscellaneous Provisions) Act 2017: Dynamising the country’s competitiveness.
In the World Bank Doing Business Report 2017, Mauritius was once again ranked first among the sub-Saharan economies, but nevertheless made a spectacular fall, moving down from an overall global ranking of 32nd last year to the 49th position in 2017.
As a developing country, Mauritius is facing fiercer competition from other countries, and the survival of the country as one of the leading global financial centres depends upon its capacity to adapt to new exigencies and raise its standards to higher levels.
In the 2016/2017 Budget Speech, prior to the publication of the Doing Business Report 2017, the Government announced a series of reforms for business facilitation aiming at liberalising the economy from the stifling bureaucracy. The Government recognized the importance of streamlining procedures to allow for a more conducive business environment and to ultimately attract foreign investments to its shores. One of the ten core strategies of the Budget is “Improving the Business and Investment Climate Project”, which is being financed up to seven million euros through a grant of the European Union.
The Business Facilitation (Miscellaneous Provisions) Act 2017 has consequentially amended several laws and came into force on the 20th of May 2017. The main characteristics of the reforms with regard to Business Facilitation include:
Expediting the process to start a business
Amendments to existing legislations such as the Companies Act, the Local Government Act and the Business Registration Act are being made in order to facilitate the setting-up of a business within less than one working day.
In addition to amendments to the laws, the process of registering a business at the Central Business Registration Database (‘CBRD’) has been improved so that registration of businesses and incorporation of companies will be made within two hours.
In line with the Government’s objectives of shifting to a digital economy, old practices will be abolished and the Companies Act is being amended to cater for the issue of electronic Certificate of Incorporation and removal of references to company seal for domestic companies.
Expediting the processing and issue of construction permits
Administrative measures are being taken and legal amendments are being made to streamline the procedures for obtaining construction permits and to expedite the process for determination of Environmental Impact Assessment (‘EIA’) licences in Mauritius. In this regard, the process for issuing of a Morcellement Permit is being reduced to three weeks where a project has already been granted an EIA licence.
Facilitating the process to register property
With a view of expediting the property registration process and providing more transparency, the Mauritius Electronic Registry Platform has been implemented to enable professionals to carry online searches from their office premises. The Notaries Act is also being amended to give the public access to a summary of the deed, as prepared by Notaries.
In the same vein, land transfer tax and registration duty are being waived on the transfer of land to construct warehouses and on the transfer of warehouses for business purposes.
Improving the insolvency procedures
The Insolvency Act is being amended to rationalize insolvency procedures and to empower the Director of the Insolvency Service to take sanction(s) against any insolvency practitioner who fails to comply with a request of the Director or any provision of the law.
Additionally, with regards to the removal of a company from the Register, the Companies Act is being amended to reduce the time frame for a person to file proof of the ground of objection with the Registrar from six to two weeks.
Improving the system for collection of taxes and levies
Through amendments to laws such as the Income Tax Act, the National Pension Act, the National Savings Fund Act, the Government will be empowering the Mauritius Revenue Authority (‘MRA’) to act as a collecting agent of social charges, and thus providing for a single point of payment for taxes and contributions by enterprises.
It must also be highlighted that the MRA has already set up an Automatic VAT Refund Mechanism for expeditious processing and refunds of VAT claims, and a system for electronic submission of amended corporate tax returns.
Implementing the E-Licensing Project
The Investment Promotion Act is being amended to implement a national electronic licensing platform which will provide a single point of entry for application, processing and determination for permits and licenses. This project also includes the setting up of a centralized Electronic Registry of licenses which will hold and provide critical data on licensing requirements.
Taking into consideration the experience of other countries, whether close neighbours or far away countries, our Government has been focussing on both administrative changes to the present processes in public sector agencies and amendments to the laws. From a red tape reduction perspective, Mauritius is progressively making administrative procedures more transparent and efficient, which is essential to establish an enabling environment for private sector development. The Business Facilitation (Miscellaneous Provisions) Act 2017 will undoubtedly benefit Mauritius and improve the Mauritian Business Climate by further facilitating the starting up of businesses, thus creating opportunities for the benefit of all, both at local and international levels.