The need of PMO approval enlarged under the Non-Citizens (Property Restriction) Act and the Foundations Act

The need of PMO approval enlarged under the Non-Citizens (Property Restriction) Act and the Foundations Act

The Non-Citizens (Property Restriction) Act 1975 (the “Act”) was recently amended through an emergency procedure on 27 April 2021. Consequential amendments were also brought to the Foundation Act 2012.

The amendments, which have been in force since 29 April 2021, specifically impose a restriction on non-citizens who are founders, beneficial owners, ultimate beneficial owners and beneficiaries of charitable or non-charitable foundations to hold, dispose of, purchase or otherwise acquire property, unless prior authorisation is sought with the Prime Minister’s Office (“PMO”).

Authorisation must be sought by way of a written application, which must contain the following information:

the precise location of the property;
a site plan showing its extent and precise location;
the nature of the interest intended to be purchased or otherwise acquired or held;
the reasons for which the application is made; and
other information that the Prime Minister may require.

Another major amendment to the Non-Citizen (Property Restrictions) Act is the inclusion of the term to “dispose of” in the list of acts requiring prior approval of the PMO.

Non-citizens cannot dispose of their properties, including properties acquired under schemes overseen by the Economic Development Board, unless prior authorisation is sought and obtained from the PMO.

Properties include shares as defined under the Act and thus, non-citizens who hold shares in companies, partnerships, sociétés or any other body corporate may not dispose of those shares unless prior authorisation is sought with the PMO. In the light of the wide definition of dispose of which includes “the burdening of a property with a mortgage or charge”, this is a major change which may have serious implications on business transactions generally.

What is at stake?

Non-compliance with the requirements of the Non-Citizen (Property Restrictions) Act may entail the sale of the property by the Curator of Vacant Estates and shall render the offender liable to criminal prosecution.

Reviewed by Thierry Koenig, head of ENSafrica | Mauritius.

For more information, please contact:

Céline Bellouard

ENSafrica | Mauritius | Barrister | Associate

cbellouard@ENSafrica.com

+230 5735 4781

Priya Emerith

ENSafrica | Mauritius | Barrister | Associate

pemerith@ENSafrica.com

+230 5728 7213

Dimitri Adam

ENSafrica | Mauritius | Barrister | Associate