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31 Mar 2020
BY Elsie Rasolohery Pascal

Mauritius: capital markets | practical considerations in the context of COVID-19

The coronavirus (COVID-19) outbreak is disrupting businesses across industry sectors and jurisdictions. Below, we highlight a few considerations that are relevant to listed issuers.

Communication with the Regulators

The Stock Exchange of Mauritius (“SEM”) has sent notifications that the staff of the Listing Division remain reachable by email. All communications with the SEM must therefore be by email.

A protocol has been established by the SEM and the Central Depository & Settlement Co. Ltd (“CDS”) to ensure business continuity across their services. The Listing Division will continue to operate and relay communiqués to the market by email or through the SEM website.

In a communique of 20 March 2020, the Financial Services Commission (the “Commission”) stated that “in order to ensure continuity of financial services, it will show flexibility towards companies, which may face challenges in meeting their forthcoming reporting obligations including regulatory filings. The Commission will consider, on a case-by-case basis, such measures that may alleviate the immediate regulatory burden for financial institution[s] during these challenging times […].”

Publication of financial statements

The deadline of 30 March 2020 for publishing financial statements for the year ended 31 December 2019 is extended by one month until 30 April 2020.

Issuers offering new notes should take into account the timing for up-to-date financial statements to be produced, before accessing the market.

Compliance and reporting obligations

Given Mauritius’ lockdown, participants must take into account unplanned business days of the SEM and the CDS, and their consequences on payment and delivery obligations, valuation dates, interest calculation periods, and service of notices to shareholders or noteholders.

Listed issuers are reminded that they are still required to comply with the Listing and DEM Rules during the country lockdown.

Notes issuers may wish to review their notes documentation, in particular, their undertakings and covenants:

  • to deliver their financial statements, including the provision of a compliance letter or certificate to noteholders, within a specified period after the end of the financial year;
  • to notify noteholders upon the occurrence of any event of default and to consider any potential cross-defaults and other potential issues; and
  • to consider the impact on the current situation on liquidity and access to funding.

Unplanned business days

In line with the power given to the Commission under the Securities Act, 2005 to cease securities transactions where it believes that the orderly transaction of business on the securities exchange is being or is likely to be adversely affected due to the occurrence of an emergency or a natural disaster, it has ordered that the Stock Exchange of Mauritius Ltd ceases all securities transactions from 27 March 2020 at 20:00 local time until 2 April 2020 at 20:00 local time.

Participants must therefore take into account these unplanned business days of the SEM and the CDS, and the consequences on payment and delivery obligations, valuation dates, or obligations, interest calculation period and service of notices to shareholders or noteholders. Upon resumption, participants must ensure that they meet all the conditions required by the CDS to perform the settlement of trades.

For more information, please contact:

Elsie Rasolohery Pascal
ENSafrica | Mauritius | Executive
epascal@ENSafrica.com
cell: +230 5492 3558

COVID-19, also known as the Coronavirus, is an infectious disease caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2) that was declared a pandemic by the World Health Organization on 11 March 2020. The disease has since been reported in over 190 countries.

No information provided herein may in any way be construed as legal advice from ENSafrica and/or any of its personnel. Professional advice must be sought from ENSafrica before any action is taken based on the information provided herein, and consent must be obtained from ENSafrica before the information provided herein is reproduced in any way. ENSafrica disclaims any responsibility for positions taken without due consultation and/or information reproduced without due consent, and no person shall have any claim of any nature whatsoever arising out of, or in connection with, the information provided herein against ENSafrica and/or any of its personnel. Any values, such as currency (and their indicators), and/or dates provided herein are indicative and for information purposes only, and ENSafrica does not warrant the correctness, completeness or accuracy of the information provided herein in any way.