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Mauritius – A new real estate haven for foreign investors?

Under the new PDS rules, a PDS promoter has the obligation to sell 25% to a Mauritian resident or member of the Mauritian Diaspora.

The Property Development Scheme (“PDS”) which has replaced the Integrated Resort Scheme (“IRS”) and the Real Estate Scheme (“RES”), allows the development of a mix of residences for sale to non-citizens, citizens and members of the Mauritian Diaspora. The Investment Promotion Act 2000 (the “IPA 2000”) was amended and the Investment (Property Development Scheme) Regulations 2015 (the “PDS Regulations 2015”) were introduced to cater for the PDS.

Succeeding to the very successful IRS and RES, will not be an easy feat for the PDS. Under the IRS and RES, promoters and developers had no obligation to sell a minimum percentage of their units to a Mauritian resident or member of the Mauritian Diaspora. The introduction and implementation of the PDS has changed the rules. Under the new PDS rules, a PDS promoter has the obligation to sell 25% to a Mauritian resident or member of the Mauritian Diaspora. This provision has already raised eyebrows within the industry and menaces to stall the progression of the thriving and upscale real estate industry in Mauritius. Nonetheless, it is laudable initiative from the Government of Mauritius in their bid to promote diversity and inclusion in the society.

The Board of Investment of Mauritius (“BOI”) has been entrusted one very specific responsibility – sell the PDS as the next big thing in real estate development in Mauritius. While it is likely to be a hard sell, the BOI has already issued a comprehensive ‘Guideline for the Property Development Scheme’ (the “Guideline”). This article will highlight some of the most salient aspects of the Guideline.

About the PDS

The PDS allows the development of a mix of residences and the programme is designed to facilitate the acquisition of residential property by non-citizens in Mauritius. The PDS is essentially an integrated project with social dimensions for the benefit of the neighbouring community and allows for the development and sale of high standing residential units mainly to non-citizens.

The PDS provides for the following:

  1. development of luxurious residential units on freehold land of an extent of at least 0.4220 hectare (1 arpent);
  2. high quality public spaces that helps promote social interaction and a sense of community;
  3. high-class leisure, commercial amenities and facilities intended to enhance the residential units;
  4. day-to-day management services to residents including security, maintenance, gardening, solid waste disposal and household services;
  5. social contribution in terms of social amenities, community development and other facilities for the benefit of the community.

The PDS Certificate

  1. A PDS certificate issued under Section 18 of the IPA 2000 is conclusive evidence that all the requirements of the IPA 2000 and the PDS Regulations 2015 as to an investment project submitted to the BOI have been complied with. From the date of issue of the certificate, the company is responsible for the development, implementation and management of the PDS project in accordance with the approval granted by the BOI.
  2. The Company issued with a PDS Certificate has to implement the project as approved by the BOI and cannot change the use to which each major part of the integrated area has been approved, without the prior approval of the BOI.
  3. In case of substantial change in the ownership or transfer of shares in the Company, issued with a PDS Certificate, which could impact on the control of the company, the PDS Certificate will automatically be considered as null and void.

Stages to be followed prior to the issue of a PDS Certificate

Stage 1 An application for a PDS Certificate must be made to the Managing Director of the BOI. The document should be signed by the director of the company making the application. Where an application is submitted by a third party (e.g. consultant), a Power of Attorney or a mandate letter given by the applicant to the third party must be submitted. The duly completed and signed application form must be submitted together with the list of mandatory documents prescribed in the Guidelines.

Stage 2 A site visit shall be carried out, following which, promoters will be called upon to make a presentation of their project to relevant Government bodies. The PDS promoters are required to highlight the project details, the issues that may hinder the realisation of the project, areas requiring BOI and other authorities’ involvement, particulars of how the benefits of the project shall accrue to the neighbouring community.

Stage 3 A Letter of Approval is issued to the PDS Company making the application for the PDS certificate where the project meets the criteria of the scheme as stipulated in the PDS Regulations 2015 and the technical committee members have no objection to the project.  The Letter of Approval is valid for a period of 12 months from the date of the letter and it stipulates all the conditions that should be met for the issue of the PDS Certificate to the company. The Guidelines provide a comprehensive list of the conditions.

Stage 4 The PDS Company will have to apply for and secure the different statutory permits and licenses which includes, but is not limited to, the Land Conversion Permit, EIA License, Building & Land Use Permit required for the implementation of the PDS project. The PDS Company will have to furnish a bank guarantee of 50,000 rupees per residential unit (including serviced land) in favour of the BOI. This guarantee is to ensure that the PDS Company completes construction works within the period specified in the Certificate.

Stage 5 A PDS Certificate is issued after the PDS Company has complied with all the procedural steps prescribed in the Guidelines. The PDS Certificate is subject to numerous terms and conditions enumerated in the Guidelines.

Acquisition of a residential property under the PDS

The following persons may acquire a residential property from a PDS Company:

(a)      a natural person, whether a citizen of Mauritius, a non-citizen or a member of the Mauritian Diaspora;

(b)      a company incorporated or registered under the Companies Act 2001;

(c)      a société, where its deed of formation is deposited with the Registrar of Companies;

(d)      a limited partnership under the Limited Partnerships Act 2011;

(e)      a trust, where the trusteeship services are provided by a qualified trustee; or

(f)      Foundation under the Foundations Act 2012;

(g)      A qualified global business as defined under the Financial Services Act 2007 holding a Global Business Licence may acquire property under the PDS scheme.

Where the acquisition of an immovable property is made on the basis of a plan or during the construction phase, the contract shall be governed by the provisions of a “vente à terme” or “vente en l’état futur d’achèvement (VEFA)”, as the case may be, in accordance with the provisions of articles 1601-1 to 1601-45 of the Code Civil Mauricien.

Residency in Mauritius

(a)      Pursuant to Regulation 15 of the PDS Regulations 2015, a residence permit under the Immigration Act is granted to the non-citizen upon acquisition of a residential property not less than USD 500,000 or its equivalent in any other freely convertible foreign or Mauritian currencies. The residential property is deemed to be acquired on its registration and payment of the fixed duty of 5% the value of property to the registrar general.

(b)      The PDS Company must inform the BOI by way of a letter addressed to the Managing Director on registration of the immovable property and submit a certificate from the Notary to the effect that the deed drawn has been duly registered and transcribed.

(c)      The residence permit granted to the non-citizen remains in force until such time the non-citizen shall hold the residential property under the scheme or where the person nominated by the company’s secretary, director, gerant or qualified trustee, of the entity, as the case may be, informs the BOI to terminate the residency.

Duty and Taxes 

The PDS is also a demarcation from the IRS and RES inasmuch as it does not differentiate between small and big landowners and harmonises the registration duty to a single rate of 5% instead of USD 70,000 on registration of a deed under IRS and USD 25,000 under RES.


While the Mauritian real estate industry has been slowly adjusting to the introduction of the PDS, it remains to be seen whether the PDS will be as successful as its predecessors, the RES and IRS. As at January 2017, the BOI has issued twenty-one (21) Letters of Approval and 4 PDS Certificates to different PDS Companies.

The LEX Africa member in Mauritius is Erriah Chambers


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