Buying a business in Mauritius

Hey Shawn
I think it depends on the size of the company though but see with the current stakeholders to explain to you the progress report of the company that you want to buy

However, you can reach out and lets talk more if you do not have any business on the table yet

Have a nice day buddy
Jerome

Morning

That's how it is from the EBD website:

1. An Initial transfer of USD 100,000 and the business activity should generate an annual turnover of at least MUR 2 million for the first year and cumulative turnover of at least MUR 10 million for the subsequent two years.

2. An existing investor with a net asset value of at least USD 100,000 and a cumulative turnover of MUR 12 million during the preceding 3 years with a turnover of at least MUR 2 million in any one year.

For more information, I suggest you call or e-mail them.

If these conditions are not met, then I suggest the terms of the permit are not being met and there's the risk of the permit being cancelled.

Investment in a business is a risk by nature. There's no guaranteed return in any business.

As investors, you might probably need to sign an Investment agreement whereby remedial actions are mentionned - in case the company does not reap the expected results. If this is done, then you do not necessarily have any remedial action because profits / loss is assimilated to usual business risk. The only way you can get something out of it (in the absence of an Agreement) is IF the loss is due to dishonest or illegal practice.

I think WilsonH's answer is more relevant to what you're looking for if you're looking to get an occupation permit through the purchase of this business.  Since you're looking to purchase an existing company, then you will have to show the EDB (upon your application) that your total assets are equal to or exceed USD 100k. If they are not, you will have to make an additional investment in the company for it to meet this threshold. <-- This is ONE the criteria you have to meet in order to contemplate a successful of an Occupation Permit as an Investor.

Once you get the occupation permit, which will usually be valid for a period of 3 years, you then have to ensure that that company's annual turnover for the first year exceeds Rs 2M and cumulated annual turnover for the second and third year exceed Rs 10M. 

Bear in mind that the EDB will have access to your filed financial statements with the Registrar of Companies and/or tax returns with the Mauritius Revenue Authority, so they will be able to monitor the financial position of the company throughout those 3 years.

If you do not meet those annual turnover thresholds, the EDB retains a right to cancel your Occupation Permit as an Investor. Those turnover thresholds are only applicable in the event that you have applied for an Occupation Permit as an Investor in the name of that company.

I hope this clarifies things for you

I would like to purchase a business in Mauritius but am concerned about the company meeting its milestone targets each year
This is a business risk, as in every business. The 'business planning' approach should be well defined and monitoring of the progress is crucial.

Are these milestones determined by the initial investment $100 , $200 ,$ 300 Thousand  or are they as per the investors requirements i.e year 1 - year  2 , year 3 ? If not met what is the consequence ?
In strictly business terms, they are not. But for Occupation Permit terms, they are essential. If not met, the permit will not be renewed. The control is done at renewal time. At this particular moment the EDB does not really check your figures on the first and second year.

I had to precise the above since some people tend to think business is just ensuring Occupation Permit. While this is important, the safeguard of your real investment is also important. It serves no purpose to live in a foreign land through a residence permit and get out of it three years later with an empty pocket. For this, you might want to hire or consult with business specialists

It all depends on the return on investment. I have a friend who is selling his pds project in Grand Baie ,including the property and the licence . You can contact me if You interested.

regards
philippe

Hi

Winston's response is relevant. In practice, the business must generate Rs 12 million in revenues over the 3 years; doesn't need to be split equally in each year. Consequence for not achieving the targets - either occupation permit will not be renewed by EDB or inject new capital of USD 100,000 again.

Cheers