The Investment Promotion (Real Estate Development Scheme) Regulations 2007 give effect to the measures announced in the 2007-2008 Budget Speech. The new regulations are related to the Integrated Resort Scheme (IRS) and to the extension of the IRS to small landowners.

The Real Estate Development Scheme which came into operation on 29 November 2007 comprises of:

1. an amended IRS for large landowners who own land of an extent exceeding 10 hectares; and
2. a Real Estate Scheme (RES) for small landowners who own, in the aggregate, land of an extent not exceeding 10 hectares

An Integrated Resort Scheme project under the regulations shall provide for the development of residential units by allowing non-citizens to acquire freehold residential properties where each plot should not exceed 1.25 arpents and sold at a price of at least USD 500,000 or its equivalent in Euro or GB pounds sterling. A project under the scheme shall also provide leisure and commercial amenities/facilities of high standing and day-to-day management services to the residents.

Provisions are made in the regulations for every IRS Company to make a contribution of MUR 200, 000 per residential units to provide for social amenities, community development and other facilities for the benefit of the neighboring community where the IRS project is implemented. The contribution shall either be in cash, infrastructure (social amenities, community development, and other facilities), land or a combination of cash, infrastructure and land. The promoters shall be required to undertake an assessment of the social needs of the region and submit particulars of the social needs to be implemented by the IRS company including estimated costs and time frame for approval by the Board of Investment.

The regulations further provide for the IRS company to ensure that the benefits of the development of the project accrue to the people of the region (business opportunities for SMEs, employment for people). A written undertaking to that effect shall be provided by the company to the Board of Investment and the company shall be required to report periodically on achievements in relation to their undertaking.

Regarding projects which have been issued with an IRS certificate by the Board of Investment and where a contribution is required under the terms and conditions of the aforesaid certificate, the IRS company will have to comply with the new regulations within 3 months. If the IRS company has already started implementation of the social needs, it shall within 3 months from the coming into force of these regulations submit to BOI the nature of the social needs completed and the amount of expenditure incurred thereon.

The Real Estate Scheme (RES) for small landowners allows the development of any mix of residences to non-citizens in specific locations approved by the Board of Investment. These residences must include amenities and other facilities as well as day-to-day management services such as security, maintenance, gardening, solid waste disposal and household services. A project under the RES must be developed on freehold land of an extent of at least 1 arpent but not exceeding 10 hectares (23.69 arpents).

A project under RES can be developed by a small landowner who owns land of an extent of at least 1 arpent but not exceeding 10 hectares in aggregate for at least 5 consecutive years. Small landowners can group their land with other qualifying small landowners for a project provided that the lands are contiguous and the total real estate development area does not exceed 10 hectares. Only a company incorporated under the Companies Act where the owners of land retain shareholding in the company for at least 1 year after the completion of the project and issued with a RES certificate by the Board of Investment will be responsible for the execution, promotion, development and proper implementation of a project under the real estate scheme.

In addition to individuals (citizens and non-citizens) and companies (incorporated or registered), trusts and societe will be made eligible to acquire a residential property under IRS and RES under the new regulations. All persons intending to acquire a residential property under IRS and RES shall require an approval from BOI. A processing fee of MUR 10,000 per application is levied. A residence permit is issued to the buyer of a residential property under IRS and his/her dependents for so long the buyer maintains the property. No residency is provided to the buyer of a residential property under RES.

The regulations also provide for where a property is acquired by foreigners, the investment must be financed from funds outside Mauritius and where a loan is taken with a bank in Mauritius, the whole amount should be in USD, EURO or GBP.