Investment Promotion Act

Chapter number: 
103A
In force: 
Yes

 

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CONSOLIDATED TO 30 JUNE 2012

 

LAWS OF SEYCHELLES

 

Act 21 of 1994

SI. 75 of 1995

SI. 103 of 1995

CHAPTER 103A

INVESTMENT PROMOTION ACT

[1st January 1995]

 

ARRANGEMENT OF SECTIONS

1.      Short title

2.      Interpretation

3.      Certificate of approval

4.      Categories of investments

5.      Concessions and incentives

6.      Minister may call for information

7.      Regulations

8.      Rules

 

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1.      This Act may be cited as the Investment Promotion Act.

2.      In this Act –

"agricultural and marine resources investment" means an investment in an enterprise for agricultural or marine based resources but does not include an enterprise engaged in the processing of agricultural and marine based resources;

"capital investment" includes land, plant, machinery, buildings, furniture, assets and vehicles of an enterprise but does not include vehicles for the transport of passengers unless transport of passengers is the principal activity of the enterprise;

"enterprise" means an industry, project, undertaking or business;

"export oriented unit", in relation to an investment, means an investment other than tourism development investment, in which?

(a)        not less than 50 per centum of the annual turnover of its products or the services, as certified by an auditor, is directly exported;

(b)        the total proceeds of the exports, as certified by an auditor, are remitted to Seychelles in foreign currency; and

(c)        not less than 50 per centum of the remittances under paragraph (b), as certified by an auditor, is converted into the currency of Seychelles;

"general category" means an investment other than an export oriented unit or a special growth area;

"industrial and manufacturing investment" means an investment in an enterprise for any construction activity or for the transformation of raw materials imported to or originating in Seychelles into finished products and includes an investment in an enterprise for transformation of agricultural or marine based resources into finished products by a chemical, mechanical or any other process;

"investor" means an existing or a potential investor;

"operating equipment", in relation to a hotel or restaurant, means equipment specified by the Minister by notice published in the Gazette;

"professional services investment" means an investment in an enterprise for supply of professional services arising out of special skills or knowledge but does not include tourism related services;

"raw materials" means direct materials identifiable in the finished product;

"small scale industries investment" means any agricultural and marine resources investment or industrial and manufacturing investment in which –

(a)     the annual turnover does not exceed R 1,000,000;

(b)     the number of workers does not exceed 10;

(c)     capital investment does not exceed R 500,000; and

(d)     the enterprise is the sole enterprise of the investor and is managed by the investor;

"special growth area" is an investment in any of the activities specified in Part I of the Schedule for such period and subject to such conditions as may be specified in the certificate;

"throughputs" means all consumables other than raw materials and includes fuel specified in Schedule 4 of the Trades Tax Regulations, 1994 or any other Regulations replacing those Regulations;

"tourism development investment" means an investment in an enterprise connected with any of the activities specified in Part II of the Schedule.

3.      (1)        The Minister may, where the Cabinet has given its prior approval, grant to an investor a certificate of approval for such period and subject to such conditions as may be specified in the Certificate of approval.

(2)        Where the Minister is satisfied that a certificate of approval has been granted under subsection (1) to an investor on material or information which to the knowledge of the investor was false or untrue or that the investor has breached any conditions of the certificate or otherwise become disqualified for the grant of the certificate, the Minister may revoke the certificate of approval in whole or in part.

(3)        Where the Minister revokes a certificate of approval of an investor under subsection (2), the Minister shall forthwith notify the investor of the revocation and the reasons therefor.

(4)        Where a certificate of approval is revoked under subsection (2), the investor shall, with effect from the date of revocation, cease to be entitled to the concessions and incentives in relation to that certificate.

(5)        Where an investor is aggrieved by a revocation under subsection (2) of a certificate of approval granted to the investor under subsection (1), the investor may within 15 days after receiving the notification of revocation under subsection (3), appeal against the revocation to the Supreme Court.

(6)        The Supreme Court may on an appeal under subsection (4) affirm or revoke the decision of the Minister.

(7)        Where on an appeal under subsection (5) the Supreme Court revokes the decision of the Minister, the certificate of approval in relation thereto shall, for the purposes of subsection (4), be deemed not to have been revoked.

4.      The certificate of approval shall be in such form as may be approved by the Minister and shall be granted for one or more of the categories of investments specified in Part III of the Schedule.

5.      (1)        Upon the grant of a certificate of approval to an investor under section 3, the concessions and incentives specified in regulations shall, notwithstanding anything in any other law, apply to the investor.

(2)        Any concession or incentive applicable to an investor under subsection (1) on the grant of a certificate of approval to the investor shall, so long as the certificate of approval is in force, not be affected to the disadvantage of the investor by any amendment, after the grant of the certificate, of the regulations referred to in subsection (1) or any other law relating to those concessions and incentives.

(3)        A certificate of approval granted to an investor in relation to an export oriented unit shall cease to be valid ?

(a)        where the investment has satisfied the requirement of an export oriented unit at the time of the grant of the certificate, if it thereafter ceases to satisfy the requirements;

(b)        where the investment has not satisfied the requirements of an export unit at the time of the grant of the certificate, if it fails to satisfy the requirements within a period of two years after its grant.

(4)        Where the certificate of approval ceases to be valid under subsection (3) the Minister shall revoke the certificate of approval and shall forthwith notify the investor of the revocation and the reasons therefor.

(5)        Where a certificate of approval granted to an investor is revoked under subsection (4), the concession and incentives specified in regulations referred to in subsection (1) in relation to the certificate shall cease to apply to the investor ?

(a)        in the case of an investment referred to in paragraph (a) of subsection (3), with effect from the beginning of the year in which it ceases to satisfy the requirements of an export oriented unit;

(b)        in the case of an investment referred to in paragraph (b) of subsection (3), with effect from the date of the grant of the certificate.

(6)        Where an investor is aggrieved by the revocation under subsection (4) of a certificate of approval, the investor may within 15 days after receiving the notification of revocation under that subsection appeal against the revocation of the Supreme Court.

(7)        Supreme Court may on an appeal under subsection (6) affirm or revoke the decision of the Minister.

(8)        Where on an appeal under subsection (6) the Supreme Court revokes the decision of the Minister, the certificate of approval in relation thereto shall for purposes of subsection (5) be deemed not to have been revoked.

6.      (1)        The Minister may require an investor to furnish any additional information relevant to the grant of a certificate of approval.

7.      The Minister may make regulations for carrying into effect the purposes and provisions of this Act and for purposes for which regulations are required under this Act.

(2)        The Minister may by regulations amend the Schedule.

8.      The Chief Justice may make rules for the purpose of appeals under section 3(5) or section 5(6) and for specifying fees payable in respect of such appeals.

 

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SCHEDULE

Part I

Special Growth Area Activities

(a)     Activities in Outer Islands as set out in Part II of

Schedule I of the Constitution.

(b)     Golf Resort

(c)     Yacht Marina

(d)     Helicopter Services

(e)     Five Star Hotel

Part II

Tourism Development Activities

(a)     Hotels

(b)     Restaurants

(c)     Casinos

(d)     Care?Hire Operators

(e)     Tour Operators/Travel Agents

(f)     Dive Centres

(g)     Boat Hirers/Charterers

(h)     Yachts and Liveaboards

(i)      Taxi Operators

(j)      Special Growth Areas

(k)     General category

Part III

Investments

(a)     Agricultural and Marine Resources Investment

i.       Export Oriented Unit

ii.      Special Growth Area

iii.     General category

(b)     Industrial and Manufacturing Investment

i.       Export Oriented Unit

ii.      Special Growth Area

iii.     General category

(c)     Professional Services Investment

i.       Export Oriented Unit

ii.      Special Growth Area

iii.     General category

(d)     Small Scale Industries and Investment

i.       Export Oriented Unit

ii.      Special Growth Area

iii.     General category

(e)     Tourism Development Investment

i.       Special Growth Area

ii.      General category

 

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LAWS OF SEYCHELLES

 

SI. 1 of 1995

SI. 55 of 1996

SI. 39 of 1997

INVESTMENT PROMOTION ACT

CHAPTER 103A

SUBSIDIARY LEGISLATION

Investment Promotion (Concessions and Incentives) Regulations

 

1.      These Regulations may be cited as the Investment Promotion (Concessions and Incentives) Regulations.

2.      Upon the grant of a certificate of approval to an investor under section 3 of the Act, the concessions and incentives set out in the Schedule shall apply to the Investor in relation to the investment specified in the certificate.

 

SCHEDULE

Trades Tax Act (Cap 240)

All rates below are expressed as a percentage of the rates specified under the Trades Tax Act

 

Capital Equipment

Raw Materials & throughputs

Mfd goods/ Services

 

New Replacement

Fuel Others

 

(a)     Agricultural and Marine Resources Investment

i.    Export Oriented Unit 0% 0% 0% 0% 0%

ii.   Special Growth Area 0% 0% 0% 50% 0%

iii.  General category 50% 100% 100% 100% 0%

(b)     Industrial and Manufacturing Investment

i.    Export Oriented Unit 0% 0% 0% 0% 0%

ii.   Special Growth Area 0% 50% 0% 0% 50%

iii.  General category* 0% 100% 100% 0% 100%

(c)     Professional Services Investment

i.    Export Oriented Unit 0% 0% 50% 0% 0%

ii.   Special Growth Area 0% 50% 0% 50% 50%

iii.  General category 0% 100% 100% 100% 100%

(d)     Small Scale Industries Investment

i.    Export Oriented Unit 0% 0% 0% 0% 0%

ii.   Special Growth Area 0% 0% 0% 0% 50%

iii.  General category 0% 09% 100% 0% 100%

(e)     Tourism Development Investment

i.    Hotels** 0% 0% 100% 100% 100%

ii.   Restaurant** 0% 0% 100% 100% 0%

iii.  Casinos 0% 100% 100% 100% 100%

iv.  Car-Hire Operators 100% 100% 100% 100% 0%

v.   Tour Operators/

Travel Agents 0% 100% 100% 100% 100%

vi.  Dive Centres 0% 0% 100% 100% 0%

vii.Boat Hirers/Charters 0% 0% 0% 100% 0%

viii.         Yachts and Live-boards 0% 0% 0% 0% 0%

ix.  Taxi Operators 50% 100% 100% 100% 0%

x.   Special Growth Area 0% 0% 0% 50% 0%

xi.  General category 100% 100% 100% 100% 100%

xiii. Passenger cruise ships *** 0% 0% 0% 0% 0%

* Where such activity involves construction, the applicable rate for all Raw materials and throughputs shall be 100%.

** In addition such establishments will be granted 50% concession on all and operating equipment limited to 2% of their Gross Revenue.

*** In respect of passenger cruise ships the applicable rate for food and beverages shall be 3%.

Social Security Act (Cap 225)

All rates below are expressed as a percentage of the rates specified under the Social Security Act.

 

Employers contribution

where the employee is a

 

Seychellois Non-Seychellois

 

(a)     Agricultural and Marine Resources Investment

i.    Export Oriented Unit* 0% 0%

ii.   Special Growth* 50% 0%

iii.  General category 100% 100%

(b)     Industrial and Manufacturing Investment

i.    Export Oriented Unit* 0% 0%

ii.   Special Growth* 50% 0%

iii.  General category 100% 100%

(c)     Professional Services Investment

i.    Export Oriented Unit* 0% 0%

ii.   Special Growth* 50% 0%

iii.  General category 100% 100%

(d)     Small Scale Industries Investment

i.    Export Oriented Unit* 0% 0%

ii.   Special Growth* 50% 0%

iii.  General category 100% 100%

(e)     Tourism Development Investment

i.    Hotels 100% 100%

ii.   Restaurants 100% 100%

iii.  Casinos 100% 100%

iv.  Car-Hire Operators 100% 100%

v.   Tour Operators/Travel

Agent 100% 100%

vi.  Dive Centres 100% 100%

vii.Boat Hireres/Charterers 100% 100%

viii.         Yachts and Liveaboards* 0% 0%

ix.  Taxi Operators 100% 100%

x.   Special Growth Area* 50% 0%

xi.  General category 100% 100%

xii.Passenger cruise ships 0% %

* In case of a non-Seychellois employee, where the rate specified above is 0% of the rates in the Social Security Act the employer shall take out an acceptable policy of health insurance in respect of each employee. Where the employer does not take out a health insurance policy, there shall be substituted for that rate a rate equivalent to be 50% of the rates specified in the Social Security.

Immigration Decree (Cap 93)

Gainful Occupation Permit

Minimum guaranteed number of non-Seychellois employees (rounded to the nearest whole number) allowed as a percentage of total employees.

(a)     Agricultural and Marine Resources Investment

i.    Export Oriented Unit 25% upon payment of the Concessional Fees

ii.   Special Growth Area 25% upon payment of the Concessional Fees

(b)     Industrial and Manufacturing Investment

i.    Export Oriented Unit 25% upon payment of the Concessional Fees

ii.   Special Growth Area 25% upon payment of the Concessional Fees

(c)     Professional Services Investment

i.    Export Oriented Unit 25% upon payment of the Concessional Fees

25% upon payment of the Normal Fees

ii.   Special Growth Area 25% upon payment of the Concessional Fees

25% upon payment of the Normal Fees

(d)     Small Scale Industries Investment

i.    Export Oriented Units 25% upon payment of the Concessional Fees

ii.   Special Growth Area 25% upon payment of the Concessional Fees

(e)     Tourism Development Investment

i.    Hotels 5% upon payment of the Concessional Fees

ii.   Restaurants 5% upon payment of the Concessional Fees

iii.  Casinos 10% upon payment of the Normal Fees

iv.  Tour Operators/

Travel Agent 10% upon payment of the Normal Fees

vi.  Dive Centres 25% upon payment of the Concessional Fees

      25% in respect of shore based personnel, upon payment of Normal Fees.

vii.Yachts and Liveaboards 100% in respect of foreign crew on board the vessel without payment of fees.

viii.         Special Growth Area 25% upon payment of the Concessional Fees

x.   Passenger cruise ships 100% in respect of foreign crew on board the vessel, without payment fees.

      25% in respect of shore based personnel upon payment Normal Fees.

The Gainful Occupation Permit Fees payable for the categories Concessional and Normal shall be R.6,000 and R.18,000 per employee per annum respectively, payable in monthly instalments.

Business Tax Act (Cap 20)

(1)         Rates of Business tax payable

Expressed as a percentage of taxable income as defined under the Business Tax Act except where otherwise specified.

(a)     Agricultural and Marine Resources Investment

i.    Export Oriented Unit 15% in excess of R.24,000

ii.   Special Growth Area Rates Specified in the Business Tax Act

iii.  General category Area Rates Specified in the Business Tax Act

(b)     Industrial and Manufacturing Investment

i.    Export Oriented Unit 15% in excess of R.24,000

ii.   Special Growth Area Rates Specified in the Business Tax Act

iii.  General category Area Rates Specified in the Business Tax Act

(c)     Professional Services Investment

i.    Export Oriented Unit 15% in excess of R.24,000

ii.   Special Growth Area Rates Specified in the Business Tax Act

iii.  General category Area Rates Specified in the Business Tax Act

(d)     Small Scale Industries Investment

i.    Export Oriented Unit 15% in excess of R.24,000

ii.   Special Growth Area 15% in excess of R.24,000

iii.  General category Area Rates Specified in the Business Tax Act

(e)     Tourism Development Investment

i     Hotels Rates Specified in the Business Tax Act

ii.   Restaurants Rates Specified in the Business Tax Act

iii.  Casinos Rates Specified in the Business Tax Act, 1987

iv.  Car-Hire Operators Rates Specified in the Business Tax Act

v.   Tour Operators/ Rates Specified in the Business Travel Agent Tax Act

vi.  Dive Centres Rates Specified in the Business Tax Act

vii.Boat Hireres/Charterers Rates Specified in the Business Tax Act

viii.         Yachts and Liveaboards Rates Specified in the Business Tax Act

ix.  Taxi Operators Rates Specified in the Business Tax Act

x.   Special Growth Area 15% in excess of R.24,000

xi.  General category Rates Specified in the Business Tax Act

xii.Passenger Cruise ships 15% in excess of R24,000.

(2)   Tax Credits

Secondary concessions for certain business if they satisfy certain criteria for the full assessment year unless otherwise specified, in which such criteria are met. This will be deductible at the time of assessment upon production of a certificate from the auditor.

 

REBATE ON BUSINESS TAX PAYABLE

 

i.        Ownership - 51% or more Seychellois owned 5%

ii.               Companies listed on the Stock Exchange 5%

iii.    Special Growth Area - as specified in schedule 5%

iv.  Where export turnover exceeds 60% of total turnover 5%

v.   Where export turnover exceeds 70% of total turnover 10%

vi.  Where export turnover exceeds 80% of total turnover 15%

vii.Number of Seychellois full time employees exceeding 90% of the workforce 5%

viii.         Where local raw material is not less than 50% of total raw materials (excluding non-renewable resources) 5%

The rebates specified will be allowed in any assessment year where the assessment fulfills these criteria.

(3)         Special deductions from taxable income

Research, Marketing, Export Promotion, Travelling and Entertainment Expenses

 

Amount qualifying for the deduction as % of turnover or actual expenditure whichever is lower

Allowable Deduction as a % of actual or qualifying expenditure

 

(a)     Agricultural and Marine Resources Investment

i.    Export Oriented Unit 2% 200%

ii.   Special Growth Area 2% 200%

iii.  General category 0.5% 100%

(b)     Industrial and Manufacturing Investment

i.    Export Oriented Unit 2% 200%

ii.   Special Growth Area 2% 200%

iii.  General category 0.5% 100%

(c)     Professional Services Investment

i.    Export Oriented Unit 2% 200%

ii.   Special Growth Area 2% 200%

iii.  General category 0.5% 100%

(d)     Small Scale Industries Investment

i.    Export Oriented Unit 2% 200%

ii.   Special Growth Area 2% 200%

iii.  General category 0.5% 100%

(e)     Tourism Development Investment

i.    Hotels 5% 200%

ii.   Restaurants 5% 200%

iv.    Casinos 5% 100%

iv.  Car-Hire Operators 5% 100%

v.               Tour Operators/Travel 5% 200%Agents

vi.    Dive Centres 5% 200%

vii.  Boat Hireres/Charterers 5% 200%

viii.Yachts and Liveaboards 5% 200%

ix.  Taxi Operators 0% -

x.   Special Growth Area 5% 200%

xi.  General category 5% 100%

(4)         Accelerated Depreciation

Rates of Depreciation allowable on Capital Investments, other than land and building will be at the following rates.

(a)         Agricultural and Marine Resources Investment

Year 1 45%

Year 2 40%

Year 3 20%

Year 4 15%

Year 5 5%

(b)         Industrial and Manufacturing Investment

Year 1 45%

Year 2 40%

Year 3 30%

Year 4 25%

Year 5 10%

(c)          Professional Services Investment

Year 1 45%

Year 2 40%

Year 3 20%

Year 4 15%

Year 5 5%

(d)         Small Scale Industries Investment

Year 1 45%

Year 2 40%

Year 3 30%

Year 4 25%

Year 5 10%

(e)     Tourism Development Investment

Year 1 45%

Year 2 40%

Year 3 30%

Year 4 25%

Year 5 10%

The difference between the accelerated depreciation and normal depreciation as specified in the Business Tax Act will have to be invested in Depreciation Bonds.

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