Now that the exit from the blacklist is almost certain, it will be for global business operators to focus on the future and the opportunities that will arise, observes François de Senneville, Head Africa group of Fieldfisher.
The European Commission has tabled the draft Delegated Regulation 2016/1675.
Mauritius is no longer on the new blacklist and it should have the force of law as of 27 February. Is the game won?
I do think that the game has now been won, although it is true that technically, in order to see this definitively, we must now wait for the vote of the European Parliament (which must take place in the month following the Commission’s decision, i.e. in a few days now). As a reminder, this decision of the European Commission is in line with the commitments made by the European Union which had committed to remove Mauritius from its black list as soon as Mauritius leaves the FATF grey list. It is therefore not a surprise, but a simple respect for the word given.
Since the inclusion of Mauritius on the blacklist, there has been a slowdown in transactions within the European Union. Similarly, due to the cumbersome due diligence procedures, many investors have turned to competing jurisdictions like Singapore and the United Arab Emirates. Can you tell us more about the impact of day-to-day operations?
All this was unfortunately expected. Inclusion on the blacklist has led to additional procedures at the level of operators and in particular banks. This has led to a loss of competitiveness in our financial sector. It had become longer, more complicated and more expensive to settle in Mauritius for its international investments. It is therefore natural that our competitors have benefited. Now let’s focus on the future and opportunities ahead now that this page is behind us. For good reason, growth is recovering strongly in the world. We must now attract opportunities and retain them. It is therefore necessary to structure ourselves so that the expected services are at the rendezvous if the financial sector wishes to emerge among its competitors. The time of easy money by offering compliance services billed more and more expensive is behind us. Now is the time for added value if we want the financial sector to continue to grow. This will involve investments by management companies to pay for talent and, if necessary, import it to achieve this. A movement of local concentration is therefore foreseeable. It is not excluded that leaders of the international council will come to Mauritius to take advantage of this situation, especially if local operators do not manage to cross this step. We cannot also exclude alliances between local operators and international brands to achieve this. They might even be welcome. Should we set up a public-private structure that would monitor our level of compliance with the FATF recommendations?
It is obvious that it is in the country’s interest to equip itself as quickly as possible with an adequate public-private structure that can meet periodically, but above all to continuously observe the progress of the long-term actions that must be taken as well as the monitoring of expenditure and the corresponding budgets to ensure the sustainability of our financial sector. This structure, both monitoring and advising the supervisory authorities in this sector, will also have to be a whistleblower whose mission would be to avoid at all costs a new episode of blacklisting. It is only with a spirit of questioning, a culture of constructive doubt and corresponding tools that we will achieve this.