Seychelles

Owning property in the Seychelles can be organised in accordance with the law of Seychelles through Company ownership. See the legal requirements below, offered by Seychelles Law firm,

IMMOVABLE PROPERTY TRANSFER RESTRICTIONS ACT

A non-Seychellois purchaser need to obtain the sanction of the Minister as required by the Immovable Property Transfer Restrictions Act as amended.  There is currently a restriction on the total amount of land in the whole of Seychelles that may be alienated to non-Seychellois and that is 5% of total in the country.

1.     All applications for purchase of immovable property or rights therein except those submitted by ‘parastatal’ organizations which are already delegated to the minister responsible for lands, will be processed in the normal manner to the Cabinet of Ministers for approval.

2.     The applicant will be requested to obtain a character reference from a person of high standing and a Police record from the country where he is presently residing or has last resided for a period of 1 year.

3.     After the necessary checks on the suitability of the land for the proposed development in the case of an application for vacant land and that the proposal accords with the prevailing sector policies, the subject property will be advertised to Seychellois, the cost of which will be born by the applicant.  The advert will appear 4 times in the Seychelles Nation over a 2-week period and interested Seychellois will then be given 3 weeks from the date of the first advert to respond.  Any interested Seychellois will then be given 2 weeks notice in writing in which to confirm that he will be purchasing the property in which case the file will be closed and the Non-Seychellois informed accordingly.  Where there is no response from Seychellois within the above time limits a Memorandum recommending the sale of the property to the applicant will be submitted to the Cabinet of Minister for approval.

4.    The Memorandum should inter alia convey the following information:-

(a)  The name, age, nationality and profession of the applicant in the case of an individual and a short statement on character and police record;

(b)    In the case of a company or partnership the names, nationality and profession of the Directors, and principal shareholders or partners together with a short statement on character and Police record.

(c)    The location and extent of the property (with a location plan attached where appropriate);

(d)   The purchase price and manner of payment if applicable;

(e)   The recommend use of the property and comments from other Ministries where appropriate;

(f)   The maximum area of land considered reasonable for the proposed development and the extent of land to be surrendered to the State where appropriate;

5.   Processing Fees

The following processing fees are payable in respect of an application for Sanction to purchase/lease immovable property or for the purchase of shares in a company owning an interest in land:

            Purchase of Immovable                         1½% of declared

            Property or rights therein                                   purchase price

            Lease of Immovable Property                           1½% of declared

                                                                                    annual rent

            Purchase of Shares                                           R1000/-

 

6.      Conditions of Sale

The following conditions (except in certain specific cases as outlined in paragraph 8 where exemptions will be recommended to Cabinet for approval) will be imposed on the applicant as part of the new policy:

(a) Money to pay the purchase price and the duties arising therefrom must be brought into Seychelles through the Central Bank of Seychelles in a convertible foreign currency and exchanged into Seychelles Rupees.  The purchase price must be paid to the seller in Seychelles Rupees.

(b)  In addition to the current 5% Stamp Duty, a Sanction duty of 30% of the purchase price of the property must be paid to Government upon presentation of the instrument of transfer for registration in accordance with Regulation 6(1) of the Immovable Property (Transfer Restriction) fees (Amendment) Regulations 1992.

(c)   In the case of vacant land a time limit (usually 2 years) must be set within which the development proposal must be completed.

(d)   In the case of a holiday home, the latter must be used strictly by the purchaser and his immediate family and must not be rented to either Seychellois or foreigners without permission in writing from Government.

(e)  The applicant must transfer the equivalent of R.2 million in convertible foreign currency through the Central Bank of Seychelles of which, (where it is agreeable to the applicant) R500,000 could be invested in Government securities redeemable over a period not exceeding 5 years (the type of such securities to be specified by the Central Bank at the time of the grant of Sanction), and the balance deposited into a personal account with a registered commercial bank in Seychelles in the case of purchase of vacant land or rights therein;

(f)   In the case of purchase of an existing development or rights therein the sum of R1 million should be transferred of which R500,000 could be invested in the above mentioned Government securities.

(g)  Both the above mentioned sums must be converted into Seychelles Rupees immediately upon receipt thereof.

A certificate to the effect that Paragraphs (e) or (f) has been complied with must be produced to the Registrar General by the Central Bank when the deed of transfer is submitted for registration.

7.  Other Criteria

Another important criterion which should be mandatory is that any Non-Seychellois wishing to acquire immovable property or rights therein on behalf of a Non-Seychellois company will have to form a locally registered company for this purpose in which at least 60% of the shares should be held by one or more individuals.  This is necessary in order to ensure property control over alienated land.  It should be noted that a Non-Seychellois company even if it is locally registered can easily evade the stringent requirements of the proposed policy if controlling interest therein is held by an overseas company.

The shares in the overseas company can easily be sold to a third party with payment being made overseas without Government’s knowledge hence defeating the objects of the proposed policy and strategy and depriving Seychelles of valuable financial and economic benefits.

8.  Exemptions

The Minister or Cabinet is already empowered to waive the 30% Sanction duty condition under the Immovable Property (Transfer Restriction) Fees (Amendment) Regulations, 1992.

8.1  In addition the conditions relating to remittance of foreign funds to a Seychelles rupee account could also be waived by Cabinet in certain cases eg:

(a)  A Non-Seychellois spouse acquiring a share in the matrimonial home;

(b)  Acquisition of freehold or leasehold property or rights therein by a Non-Seychellois individual or company for a substantial bona fide investment in Seychelles eg: a large tourism industrial or commercial development;

(c)   A Non-Seychellois company carrying on business in Seychelles and which derives its main income in Seychelles;

(d)  A locally registered company with either minority or majority Non-Seychellois shareholding set up for the        purposes of a bona fide business venture;

However where such a company is set up specifically to acquire a residential property or holiday home no exemption will be granted;

(e)  Where a Non-Seychellois individual or company leases property for less than two years.

Information supplied by :

Dr Shelton Jolicoeur

ILCS (International Law & Corporate Services)

PO Box 1137, Victoria

2^nd Floor

Allied Building Annex

Francis Rachel St. Victoria

Tel: (248) 323850

email: info@ilcssez.com

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