You are here:
PacLII >>
Databases >> Vanuatu - Foreign Investment Approval Application Guide
Vanuatu - Foreign Investment Approval Application Guide
Download PDF version [160KB]
FOREIGN INVESTMENT APPROVAL
APPLICATION GUIDE
Republic of Vanuatu
VANUATU INVESTMENT PROMOTION AUTHORITY
Private Mail Bag 9011, Port Vila, Vanuatu
Tel : +678 24096 / 24441 Facsimile: +678 25216
E-mail: investment@vipa.org.vu Website: www.investvanuatu.org
Welcome
Welcome,
and thank you for choosing Vanuatu as an investment destination. This
guide is designed to provide you with all the information you will need
to complete a successful foreign investment application.
I
encourage you to read the guide before completing an application. It
explains our different application forms, approval requirements and the
evidence you must provide when applying. It is organized into the
following sections:
• General
information – general background about the process of obtaining a
foreign investment approval certificate including its legal basis and
the responsibilities and privileges it bestows on successful foreign
investors.
• Types of
application forms and associated fees – summary of the three types of
application forms you will need to be familiar with and our application
processing fees.
• Common
application related questions – Responses to commonly asked questions
such as how long it takes to process an application and what criteria
we use when assessing them.
•
Application guides – question by question guides that will assist you
to successfully complete each of the following application forms:
• New investment;
• Variation of an existing foreign investment approval certificate;
• Annually renew your foreign investment approval certificate.
While
we have made an effort to make the document as comprehensive as
possible, we appreciate there will always be specific queries and
issues for individual investors. We here at VIPA are always available
and happy to respond to any specific questions you may have. Please
contact the Manager, Foreign Investment Registration using the contact
details identified on the cover of this guide.
--------------------------------------------
Chief Executive Officer
Vanuatu Investment Promotion Authority
Contents
FOREIGN INVESTMENT APPROVAL
General Information
Common application related questions
Instructions for successfully completing an application form for a “New Investment”
Instructions for successfully completing an application form to “Vary an Existing FIAC”
Instructions for successfully completing an application form to “Renew a FIAC”
Schedule of fees and penalty fines
Application fees
Other fees
Penalty fines
FOREIGN INVESTMENT APPROVAL
General Information
Background
The
Government of Vanuatu has as its key goal raising the welfare of the
people of Vanuatu. It recognizes the significant contribution private
enterprise can play in achieving this goal, and is committed to having
in place an environment conducive to the maintenance and creation of
new investment.
While the Government welcomes foreign investment
to Vanuatu, it also seeks to protect the interests of citizen
investments in certain sectors of the economy. It also wishes to ensure
foreign investors are bone fide and possess sufficient financial means
to establish and operate their planned investments.
Purpose
Foreign
investment approval is the regulatory mechanism used by the Government
to help it achieve the above mentioned objectives. Once obtained, it
provides a foreign investor with the legal right to establish and
conduct business in specified activities and locations within Vanuatu.
Underlying legislation
The Foreign Investment Promotion Act 1998 (referred to hereafter as “the Act”) regulates foreign investment into Vanuatu.
Under
the law, a foreign investor is not allowed to engage in business within
the country without first obtaining a foreign investment approval
certificate. This requirement precedes all other business regulatory
requirements.
The Act is currently under review with the aim of
making the foreign investment approval process more transparent and
efficient to administer. The review is expected to be completed by the
end of 2009.
Definition of a foreign investor
A foreign investor is defined as:
• a person who is not a citizen of Vanuatu; or
•
a body corporate that is not wholly owned by Vanuatu citizens or has
any of its shares (voting or otherwise) beneficially owned or
controlled by persons who are not Vanuatu citizens; or
•
any entity other than a natural person or a body corporate where
control of, or benefit to be derived from the entity, will vest wholly
in persons who are not citizens of Vanuatu or a body corporate that is
a foreign investor.
Foreign investment approval certificate (FIAC)
A
successful foreign investor is issued with a foreign investment
approval certificate (FIAC). The FIAC is issued under the registered
name of the foreign investor and specifies all business activities the
enterprise may undertake within the country, along with the geographic
location of these activities. The FIAC is issued for a period of one
year.
A foreign investor must renew their FIAC annually by
lodging an application describing their performance during the year and
future plans.
In the event a foreign investor wishes to change
any aspect of their FIAC they must submit an application for variation.
This applies to a change in business name, shareholding or type or
location of business activity. A revised FIAC is issued once the
variation has been approved.
Failure to obtain a FIAC or amend
it as required could result in the foreign investor committing an
offence under the Act, for which a fine not exceeding VT500,000 is
prescribed. Investors who continually fail to abide by the terms and
conditions of their certificate or Vanuatu’s other laws may have their
certificate revoked.
Responsible government authority
The
Vanuatu Investment Promotion Authority (VIPA) is the government
authority tasked under the Act to receive and assess foreign investment
applications, issue, vary and renew FIACs, and monitor foreign investor
compliance with conditions set out in the certificates.
Foreign investor responsibilities and privileges
A
FIAC bestows both responsibilities and privileges on a foreign
investor. It is important that you are aware of these responsibilities
and privileges.
Responsibilities
•
Obey all the laws of Vanuatu, including completing and complying with
all the regulatory requirements necessary to establish and operate a
business in the country.
• In
the case of investors with limited Bislama, English or French language
skills, ensure at least one staff person is available to provide
translation services to ensure government agency monitoring and
inspection activities are effectively implemented.
•
Whenever possible hire and train Ni-Vanuatu workers, ensure they are
registered with the Vanuatu National Provident Fund, and treat them in
accordance with Department of Labour regulations.
•
Implement development activities sensitive to the country’s diverse
cultural traditions and fragile ecosystems, and which are in compliance
with the Environmental Management and Conservation Act 2002.
Privileges
• Zero corporate and personal income tax.
•
Subject to compliance with the Value Added Tax Act and Import Duties
Act, eligible for an exemption from either VAT or import duty, or both,
for the whole or part of the investment.
•
Subject to compliance with the Immigration Act, guaranteed minimum two
residency permits for shareholders in the foreign investment who intend
to reside in the country to implement their investment.
•
Subject to compliance with the Labour (Work Permits) Act, access to
work permits for at least two key positions requiring professional,
technical or managerial expertise.
•
Subject to compliance with the Land Leases Act, permission to lease
land for periods up to 75 years in rural areas, and 30 to 50 years in
urban areas.
• Freely able to repatriate funds without condition.
Types of foreign investment application forms
There
are three types of application forms, each of which is designed for a
specific purpose. The types of forms and explanations of when they
should be are outlined below:
Table 1. Types of foreign investment applications
| Application Form | When it should be used? |
| 1. New Investment | • To obtain a FIAC for a new investment in the country. |
| 2. Variation | • To change any aspect of an existing FIAC including business name, ownership, business activity or location. |
| 3. Renewal | • To renew an existing FIAC. Renewals must be done annually before the anniversary date of the FIAC. |
A
listing of application fees and fees for other services is included at
the end of the guide. It also identifies penalty fees charged for
different infractions related to the Act.
Common application related questions
Should I consult with other government agencies about my proposed business activities before I submit my application?
Yes,
we strongly encourage you to understand the regulatory environment you
will be working within before you submit your application for a foreign
investment approval certificate (FIAC).
First, you need to be
aware that the FIAC is required by law to identify the location of your
business activities. Because Provincial Councils and the Municipalities
of Port Vila and Luganville have authority to regulate some aspects of
business operation within their boundaries, there is the potential some
of these by-laws may include restrictions specific to foreign
investors. Unfortunately, there is no central repository of these
by-laws and rules. As a result, it is important you visit the
appropriate local authority as soon as possible to gain a better
understanding of their rules and how they may affect your proposed
business activities.
Second, you should also be aware the
Government of Vanuatu has policies in place to sustainably manage its
natural resources. This typically involves the setting of annual
allowable harvest levels which limit the number of licences that can be
issued at any one time. Moreover, in cases where over-exploitation of a
natural resource is deemed to have occurred harvesting bans will be
introduced. Such bans apply to all investors. If you are intending to
harvest or exploit natural resources you should consult the relevant
resource agencies as soon as possible to gain an understanding of the
health of the target natural resource, as well as, the current
availability of associated licences.
When is the appropriate time to make an application?
This
depends on the type of application you intend to submit. The table
below explains the requirements for each type of application:
Table 2. When to submit an application
| 1. New Investment | • We encourage you to complete the application process as soon as
possible once you have identified a viable business opportunity. The
FIAC is a pre-requisite for all other business regulatory requirements.
VIPA staff can also provide information and support to assist you
comply with these other requirements. Please note that you do not need
to be outside of the country in order to submit an application. |
| 2. Variation | • Changing your business name – You should first register the change at
the Vanuatu Financial Services Commission (VFSC). You will then need to
provide proof of this VFSC registration as part of your application to
VIPA. The application for variation should be submitted to VIPA within
two weeks of the change being made at the VFSC.
• Changing ownership of the investment – If you are selling all or part
of your business to new investors (foreign or local), or adding or
deleting shareholders, you should submit an application for variation
before making your final transaction. We recommend you do this to
ensure the proposed new foreign investors meet the requirements of the
Act and are deemed fit and proper persons. In instances where you have
added or deleted shareholders you will be required to submit a copy of
the VFSC document registering your revised ownership as a condition of
the approval.
• Changing business activity or business location – If you are intending
to begin operation of a new business activity or establish operations
of an already approved business activity but in a new location, you
must submit an application for variation before you proceed. You also
should submit an application for variation if you intend to stop
operating an already approved business activity. This can be done at
your discretion but should be completed before the end of the calendar
year in order to avoid payment of business licence fees associated with
that activity. |
| 3. Renewal | • Your FIAC must be renewed annually before its anniversary date. We
recommend you submit your application at least 3 weeks in advance of
your FIAC’s expiry date. Failure to renew your FIAC on time will incur
a penalty fee of VT100,000. |
In addition to the application form, are supporting documents required?
Each
type of application requires you to provide supporting documents. These
requirements are identified in the checklist included on page two of
each application form. Specific supporting document requirements are
explained in the “Filling out an application” sections of this document.
What language can I use to prepare my application?
All
applications, as well as supporting documents, must be completed in
either English or French. Supporting documents written in another
language must be translated into English. In these instances, the
original supporting document as well as the English translation must be
submitted as part of the application.
At what point is an application accepted for processing?
VIPA
staff use the checklists included at the front of each application form
to ensure that your application includes all the necessary information
and complies with the above mentioned language requirement. Payment of
the application fee will only be accepted if the application is found
to be complete. Application fees must be paid in full and are
non-refundable.
Applications that are deemed incomplete will be
returned with an explanation of what information is required in order
to address the gap.
On acceptance of the application, VIPA
issues a receipt indicating the payment was made and identifies a
target date for providing its response.
How long will it take to process my application?
Much
of the application processing is done by VIPA staff, but some
applications must go to the VIPA Board for consideration and approval.
VIPA is committed to providing a response for all types of application
within 15 working days of accepting a complete application.
What criteria are used to assess my application?
The key criteria used by VIPA to assess your application are identified below.
Table 3. Criteria used to assess applications
| 1. New investment | • Application is complete – All specified information requirements
have been met. This means the application form has been fully
completed, statutory declarations for all non-citizen investors have
been completed and signed, all supporting documents are attached and
complete, and the application fee has been paid in full.
• Proposed business activity is not prohibited - Certain activities cannot be undertaken by private sector enterprises
in Vanuatu. These activities are identified in Schedule 1, Part 1 of
the Act and include: the manufacture of nuclear and chemical weapons,
as well as arms; and the dumping or storage of nuclear waste of toxic
chemicals. The Penal Code Act also prohibits adult entertainment and
related services such as massage parlours, prostitution, as well as the
production and sale of x-rated materials.
• Proposed business activity
does not contravene reserved list requirements – Certain activities are
reserved solely for Ni-Vanuatu citizens, or restricted by minimum
investment conditions. These activities are identified in Schedule 1,
Part 2 of the Act. An application to invest in an activity reserved
solely for Ni-Vanuatu citizens will be rejected. An application to
invest in a business activity with minimum investment conditions is
permissible subject to the applicant providing a satisfactory
explanation describing how and when these conditions will be
achieved. The list of reserved activities is included as an appendix to
the application form.
• Proposed investor(s) is a fit and proper
person – An application will be rejected in instances where any
investor in the proposed investment has been: a) convicted by a court
in Vanuatu or any other country of an offence in respect of which they
have been sentenced to imprisonment for a term of 6 months or more; or
b) declared bankrupt more than twice, or is currently bankrupt and has not yet been granted an “order of discharge” by a court. |
| 2. Variation | Decision criteria depend on the nature of the variation being applied for:
• Change in business name
- Application is complete – All specified information requirements have been
met. This means the application form has been fully completed, the name
identified on the business name registration certificate is identical
to the name change being sought, and the application fee has been paid
in full.
•
Change in ownership
- Application is complete – All specified information
requirements have been met. This means the application form has been
fully completed, statutory declarations for all new non-citizen
investors have been completed and signed, all supporting documents are
attached and complete, and the application fee has been paid in full.
- Proposed investor(s) is a fit and proper person – An application will be
rejected in instances where any investor in the proposed investment has
been: a) convicted by a court in Vanuatu or any other country of an
offence in respect of which they have been sentenced to imprisonment
for a term of 6 months or more; or b) declared bankrupt more than
twice, or is currently bankrupt and has not yet been granted an “order
of discharge” by a court.
•
Change in business activity or location
- Application is complete – All
specified information requirements have been met. This means the
application form has been fully completed, all supporting documents are
attached and complete, and the application fee has been paid in full.
- Proposed
new business activity is not prohibited – Certain activities cannot be
undertaken by private sector enterprises in Vanuatu. These activities
are identified in Schedule 1, Part 1 of the Act and include: the
manufacture of nuclear and chemical weapons, as well as arms; and the
dumping or storage of nuclear waste of toxic chemicals. The Penal Code
Act also prohibits adult entertainment and related services
such as massage parlors, prostitution, as well as the production and
sale of x-rated materials
- Proposed business activity does not
contravene reserved list requirements – Certain activities are reserved
solely for Ni-Vanuatu citizens, or restricted by minimum investment
conditions. These activities are identified in Schedule 1, Part 2 of
the Act. An application to invest in an activity reserved solely for
Ni-Vanuatu citizens will be rejected. An application to invest in a
business activity with minimum investment conditions is permissible
subject to the applicant providing a satisfactory explanation
describing how and when these conditions will be achieved. The list of
reserved activities is included as an appendix to the application form. |
| 3. Renewal | • Application is complete – All specified information requirements have
been met. This means the application form has been fully completed, all
supporting documents are attached and complete, and the application fee
has been paid in full. |
Please
note that under the Act the VIPA Board also has the authority to
request other information from you if they feel it is necessary.
Failure to successfully address such a request in a timely way may
jeopardize the approval of your application.
Is there a process I can use to dispute a decision I don’t agree with?
Yes,
in the event you are unhappy with a decision we have made with respect
to your application you may launch an appeal within 14 days of
receiving the decision. Your appeal should be submitted to VIPA and
must be addressed to the VIPA Board. It should provide a clear
explanation of the reasons why you believe the initial decision should
be overturned. A fee of VT 5,000 is charged to lodge an appeal. The
VIPA Board will respond to any appeal letter it receives within 14
days. If you are still unsatisfied with the decision you may lodge a
further appeal with the Supreme Court.
Applying to establish a new investment
Instructions for successfully completing an application form for a “New Investment”
This
section will help you understand what information we need you to
provide in order to obtain a foreign investment approval certificate
(FIAC) for the first time and why. It is organized according to the
questions found in the application form.
Section 1: General information and checklist
Question 1 – Proposed business name
This
information is used to issue your FIAC. The name you select, however,
must be consistent with the Business Name Act, 1990. You must visit the
VFSC to apply for the reservation of your name. This can be done
quickly and at minimal cost.
Questions 2 to 5 – Name of key contact and contact information
This
is the person to whom all correspondence relating to your investment
will be sent, and whom we will contact if issues arise as part of our
monitoring activities. It can be you as the investor, a local business
consultant who is acting on your behalf, or a managing director you
have hired to run the business. You must provide us with a mailing
address, telephone number and email address.
You will be given an opportunity to update this information as part of the renewal process that occurs annually.
Question 6 – Brief description of proposed investment
You
must provide us with a concise summary describing the nature of your
proposed investment in the country. This will provide us with a clear
picture of your intentions. Please note your summary should be
consistent with the business activities you select in section 3. More
detailed information describing your activities should be included in
your business plan.
Question 7 – Checklist and required supporting documents
You
must ensure that all items identified in the checklist are appended to
your application. This information helps us verify and better
understand information included on your application form. Immediately
prior to submitting your application you should review this information
to ensure it is complete and then tick the associated box confirming it
is included in your package.
Table 4. Required supporting documents (New Investment)
| Statutory declaration(s) | • A signed declaration (original) is required for each investor that is
not a Ni-Vanuatu citizen or registered as a company in Vanuatu. The
declaration is used to notify us of any previous bankruptcies or
criminal convictions incurred by a shareholder in the investment. It
also provides us with comfort that the information provided in the
application form is true and accurate. The declaration must be signed
by the investor, as well as a registered Justice of the Peace,
Commissioner for Oaths or Notary Public, in Vanuatu or the country
where the investor resides. The declaration is included at the end of
the application form. |
| Business name reservation | • Obtainable from the VFSC, the business name reservation certificate
notifies us that your proposed business name (your response to Q.1) has
been reserved in Vanuatu solely for your use. Following approval of
your application you will be required to complete the process of
registering this name at the VFSC, along with incorporating or
registering your business entity. |
| Passport ID pages | • Copies of the passport ID pages for each foreign investor must be
provided. This is to substantiate the list of proposed shareholders in
the investment, and assists us with any investor screening checks we
may undertake. |
| Police clearance(s) | • Police clearances are required only for shareholders in the
investment who intend to reside in Vanuatu, as well as their
accompanying family members (if applicable). They provide evidence
these persons are of good character. Each police clearance must be less
than three months old when the application is lodged. It should be
obtained from the national or federal police force from the country the
individual has lived in for the past 12 months. If you are unable to
obtain a police certificate you must provide us with detailed
information of your attempt to get one. |
| Confirmation of funds | • You must provide proof you have financial resources (cash or other
unencumbered assets associated with the proposed business) of at least
VT 5.0 million. This provides us with comfort that you are a serious
investor with immediate access to capital for commencing your
investment. For cash assets, proof must be in the form of a current
bank statement (i.e. within five days of date of application) in the
name of one or more of the investors from a commercial bank in Vanuatu
or overseas attesting to this level of capital. In the case of land or
other assets, proof should include ownership papers in the name of the
investor and a valuation of the asset at current market prices. If the
assets are located in Vanuatu the valuation must be done by a valuer
who is registered with the Valuer General. If the assets are located
outside of the country, it must be done be done by a qualified third
party. |
| Business summary | • The business summary provides us with a better idea of the nature of
your proposed activities and assures us your intentions are serious. It
should address the following:
− Business description: concept behind
the business and a detailed explanation of what you propose to do and
where in the country it will be based
− Products or services: description of your proposed products and services
−
Management and staff: Key members of your management team and the
numbers and types of local employees you intend to hire, along with
proposed monthly wage rates.
− Reserved activities: Only necessary
if you intend to pursue a reserved business activity. In these
instances you must explain how and when you will achieve the planned
level of operation you specify in Q12, including providing a proforma
income statement for the first three years of operation.
|
| Local worker training plan | • You must provide a breakdown of your proposed staffing for the first
3 years of the investment. It should be broken down by citizen and
non-citizen workers and identify the key types of workers you will
require. Your training plan should outline the general skills training
you intend to undertake for the citizen component of your workforce and
how this will be done, i.e. on-the-job training, local training
courses. In cases where you intend to use expatriate labor, it should
also address your strategy for reducing this reliance over time. |
Section 2: Foreign investor information
Question 8 – Foreign Investor details
You
are required to identify all individuals or companies that are
shareholders in the business. This enables us to know who is behind the
investment and confirm the categorization of the investment as a
foreign investor.
In the case of individuals the names should
correspond to the names identified on the ID pages of their passports.
Contact details, and information about citizenship and percentage
ownership must be provided. individuals or companies that are
shareholders in the business. This enables us to know who is behind the
investment and confirm the categorization of the investment as a
foreign investor.
If a company will be a shareholder in the
investment you must provide a listing of its shareholders and
directors, the jurisdiction where the company is incorporated, its
contact details, and the percentage of its ownership held by
non-Ni-Vanuatu citizens.
Each investor that is not a Ni-Vanuatu
citizen or registered as a company in Vanuatu must complete a statutory
declaration included on page 7 of the application form.
Question 9 – Associated businesses
In
order to get as a clear picture of the ownership of the proposed
investment as possible, you are required to inform us of other
businesses that shareholders of the proposed foreign investment are
currently involved in, whether in Vanuatu or overseas.
Question 10 – Form of intended business entity
You
should indicate the type of business entity you intend to operate under
in Vanuatu. Following receipt of a FIAC, you will be required to visit
the VFSC to register your business entity.
Section 3: Business activities and location
Question 11 – Intended investment categories, business activities and location
The
FIAC will list every business activity you are permitted to undertake
in Vanuatu, as well as the locations you will operate from. It provides
us with a transparent means of monitoring your activities in the
country. This listing will also be used later to assist local
authorities issue your annual business licence.
Using the list
of investment categories and business activities included in Appendix A
of the application form, and for each location in the country where you
intend to base yourself, you should identify each business activity you
intend to pursue and its associated investment code.
With
respect to information about the location of your investment, we only
require you to identify the municipality or province from which you
will operate. In identifying your location you should select from the
following options:
• Port Vila Municipality
• Luganville Municipality
• Shefa Province (operating outside of Port Vila in Efate, Epi and Shepherd Islands)
• Sanma Province (operating outside of Luganville in Santo and Malo)
• Malampa Province (Ambryn, Malakula and Paama)
• Penama Province (Pentecost, Ambae and Maewo)
• Tafea (Tanna, Aniwa, Futuna, Erromango and Anatom)
• Torba Province (Banks and Torres Islands)
For example:
If you intend to establish a hotel on Tanna, you would record:
• “D3 (code); Accommodation, restaurants and bars (category); Hotel (business activity); Tafea Province (location)”.
Alternatively, if you intend to establish an accounting practice in Port Vila and Luganville, you would record two entries:
• “F4; Other professional and business services; Accounting Practitioner; Port Vila Muncipality”, and
• “F4; Other professional and business services; Accounting practitioner; Luganville Municipality”.
It
is extremely important your list is comprehensive and accurate. You
should not hesitate to consult with a VIPA staff person if you have any
questions in interpreting Appendix A or preparing your list.
Question 12 – Reserved business activities
Certain
business activities have been defined as “reserved” under the Act.
These activities are identified in Appendix B of the application form.
Some of these activities (section 1) are reserved solely for Ni-Vanuatu
citizens. As a foreign investor, you are not permitted to involve
yourself in any of these activities.
Others (section 2),
however, are open to foreign investment assuming you meet certain
conditions. If you intend to operate one of these business activities
you must inform us of this intention and identify the planned level of
operation you intend to achieve. This planned level must be greater
than the minimum investment threshold that has been set. For example,
if you intend to establish a hotel on the island of Tanna it must have
a total investment of 10 million vatu or annual sales turnover of 20
million vatu. Let’s say you propose to invest 50 million vatu in the
project. You would record the following:
•
“D3 (code); Hotel (business activity); Tafea Province (location);
annual turnover of 50 million vatu (planned level of operation)”
Please
note that in your business summary, you must clearly explain how you to
intend to achieve this planned target level of operation by the end of
your first two years of operation. If you are unable to demonstrate
achievement of the specified minimum investment within this timeframe
your right to operate in the reserved activity may be revoked.
Section 4: Implementation issues
Question 13 – Management
In
instances where you intend to employ someone other than one of
the investors to manage the day-to-day affairs of the business,
you are required to provide us with the name and contact details of
this individual. This lets us know who has operational responsibility
for your investment.
Question 14 – Access to land
Gaining
access to land in Vanuatu through a lease arrangement can be a
challenge. While it is not essential for you to have already made such
arrangements we are interested in knowing if this is an important
pre-requisite for your investment, and if so, how far along the process
you have gone. This information provides us with a better understanding
of how long it may take you to become operational. It also gives an
indication of how we at VIPA might be of assistance in this area.
Question 15 – Potential environmental impacts
The
promotion of environmentally sound and safe management and conservation
of the country’s natural resources is a key objective of the Government
of Vanuatu. Assuming your application is approved, and following the
full preparation of your development proposal, you are required to
consult the Environment Unit at the Ministry of Lands to determine if a
preliminary impact assessment is required. Preliminary assessments are
required only in situations where your development proposal is likely
to cause a significant environmental, social or custom impact. The
results of such an assessment will then be used to determine if a full
impact assessment is required.
By responding to the six
questions included in the application form concerning your proposed
plans, we both gain a better understanding of whether a preliminary
impact assessment will ultimately be required. If you answer yes to any
of the questions included in Q.15 there is a good chance the
Environment Unit will require this of you. In the event you respond
positively to any of these questions, you should also provide a brief
explanation of the nature of your development activity. For example, if
you propose to build wharf facilities and a fish processing plant, you
might respond:
• “ yes” to Q.15a and c;
•
“wharf facility will be constructed to accommodate long-line vessels,
and large volumes of water will be used to process fish which will then
receive primary treatment before being discharged into the ocean” (as
your explanation).
Please note that if you answer “no” to
all of the questions included in the self-assessment it does not mean a
preliminary environmental impact assessment will not be required. Once
you have obtained your FIAC, you still must consult the Environment
Unit to clarify your obligations with respect to this requirement.
Section 5: Summary information
Question 16 – Investors
Provide
a list of the full names of all shareholders in the investment, along
with their nationalities and percentage shareholding. This information
summarizes the information you provided in response to Question 8.
Question 17 – Residency permits required
Provide
the full names of those individuals who intend to reside in Vanuatu for
the purposes of implementing the investment. The person(s) can be an
investor (identified in response to Question 16), a designated manager
(identified in response to Question 13) or an accompanying family
member. You are guaranteed a minimum of two residency permits. If you
require more you must explain why they are required. You must provide a
police clearance for each of these people.
Please note you are
still required to contact the Immigration Department and fully comply
with their application process. Section 9A of the Immigration Act CAP
66, however, currently obligates the Department to issue any residency
permits agreed to as part of the FIAC as long as they meet the
conditions set out in the Immigration Act.
Question 18 – Value of proposed investment
You
are required to provide an estimate of the total value of the
investment you intend to make in millions of vatu. This information
provides us with important information that we use for statistical and
monitoring purposes.
Your estimate must be broken down into
basic asset categories (i.e. land and buildings, plant and equipment
etc) with an indication of whether the assets will be sourced locally,
or purchased overseas. It must cover the first three years of your
investment, informing us the total value of the investment at the end
of each year. Please note this information should be consistent with,
and supported by, information you include in the financial section of
your business plan.
Question 19 – Projected employment
You
are also required to provide a summary of the formal employment your
investment is expected to create over the first three years of
operation. This information is similarly used for statistical and
monitoring purposes.
The information should represent full-time
positions (excluding any investors) and be broken down according to
their position type (i.e. management, skilled or non-skilled) and
citizenship (i.e. Ni-Vanuatu or foreign worker). This information
should be consistent with, and supported by, information included in
your business plan.
Please note, once issued with a FIAC, you
will be required to register as an employer with the Vanuatu National
Provident Fund and make monthly social security payments to the Fund on
behalf of your workers.
Instructions for successfully completing an application form to “Vary an Existing FIAC”
This
section will help you understand what information we need you to
provide in order to vary your foreign investment approval certificate
and why. It is organized according to the questions found in the
application form.
Section 1: Type of variation requested and checklist
Question 1 – Business name
This is the name of the business under which your existing FIAC has been issued.
Questions 2 and 3 – Name of key contact and telephone number
This
is the person to whom all correspondence relating to your investment is
normally sent, and whom we will contact if issues arise as part of our
monitoring activities. You must also provide us this person’s telephone
number.
Question 4 – Type of variation requested, checklist and supporting documents
This
single application form can be used to make several changes to your
FIAC. The first step is to tick the box associated with the type of
variation you wish to make:
• Option a) – Change the business name that appears on your FIAC
• Option b) – Change the shareholding ownership of the investment
• Option c) – Add or delete a business activity or change your business location
Please note you can use the application to make one or more changes at the same time.
Once
you have made your selection, you must ensure that all items identified
in the checklist associated with this option are appended to your
application. This information helps us verify and better understand
information included on your application form. Immediately prior to
submitting your application check to ensure you have this information
and then tick the associated box confirming it is included in your
package.
The following table identifies and explains the
supporting documents you are required to submit and is organized by
type of variation.
Table 5. Required supporting documents (Variation)
| Change in Business Name | |
| Business name registration certificate | • Copy of the certificate issued by VFSC identifying your new business
name. This is required in order to verify that the business name under
which your new FIAC will be issued has been legally changed. |
| Change in Ownership | |
| Statutory declaration(s) |
• A signed declaration (original) is required for each investor
that is not a Ni-Vanuatu citizen or registered as a company in Vanuatu.
The declaration is used to notify us of any previous bankruptcies or
criminal convictions incurred by a shareholder in the investment, and
provides us with comfort that information provided in the application
form is true and accurate. The declaration must be signed by the
investor, as well as a registered Justice of the Peace, Commissioner
for Oaths or Notary Public, in Vanuatu or the country where the
investor resides. The declaration is included at the end of this
section of the form. |
| Passport ID pages | • Copies of the passport ID pages for each new foreign investor must be
provided. This is to substantiate the list of new proposed shareholders
in the investment, and assists us with any investor screening checks we
may undertake. |
| Police clearance(s) | • Police clearances are required only for shareholders in the
investment who intend to reside in Vanuatu, as well as their
accompanying family members (if applicable). They provide evidence
these persons are of good character. Each police clearance must be less
than three months old when the application is lodged. It should be
obtained from the national or federal police force from the country the
individual has lived in for the past 12 months. If you are unable to
obtain a police certificate you must provide us with detailed
information of your attempt to get one. |
| Letter of support from business owner/director | • A letter from the owners or directors of the business is required in
order to confirm the proposed change in shareholder ownership. This
provides us with comfort that the transaction is legitimate. The letter
should be on company letterhead and specify the ownership changes that
are being made. |
| Confirmation of funds | • You must provide proof you have financial resources (cash or other
unencumbered assets associated with the proposed business) of at least
VT 5.0 million. This provides us with comfort that you are a serious
investor with immediate access to capital for commencing your
investment. For cash assets, proof must be in the form of a current
bank statement (i.e. within five days of date of application) in the
name of one or more of the investors from a commercial bank in Vanuatu
or overseas attesting to this level of capital. In the case of land or
other assets, proof should include ownership papers in the name of the
investor and a valuation of the asset at current market prices. If the
assets are located in Vanuatu the valuation must be done by a valuer
who is registered with the Valuer General. If the assets are located
outside of the country, it must be done be done by a qualified third
party. |
| Existing business licence | • Provide a copy of your current business licence. For businesses
located in Port Vila or Luganville, your business licence is obtainable
from the Rates and Taxes Office, Department of Customs. For businesses
located in other areas of the country it is issued by the local
Provincial Council. This confirms that your business is operational and
in compliance with Business Licencing requirements. |
| Change in Business Activity or Location | |
| Existing business licence | • Provide a copy of your current business licence. For businesses
located in Port Vila or Luganville, your business licence is obtainable
from the Rates and Taxes Office, Department of Customs. For businesses
located in other areas of the country it is issued by the local
Provincial Council. This confirms that your business is operational and
in compliance with Business Licencing requirements. |
| Business summary (if investing in a reserved activity) | • If you are intending to invest in a “reserved” business activity to
which minimum investment conditions are attached, you must explain how
and when you will achieve the planned level of operation you specify in
answer to Q11b. Your business summary should address the following:
− Business description: detailed explanation of what you propose to do and where in the country it will be based
− Products or services: description of your proposed products and services
−
Management and staff: key members of your management team and the
numbers and types of local employees you intend to hire, along with
proposed monthly wage rates.
− Financial plan: proforma income
statement for the first three years of operation showing when the
required threshold levels will be achieved. |
Section 2: Variation in business name
Questions
in this section only need to be completed and submitted if you are
changing the business name that appears on your FIAC.
Question 5 – Business Name
Provide your new business name as it appears on your business name registration certificate issued by the VFSC.
Signature
You must sign and date page 3 of the application form.
Section 3: Variation in ownership
Questions
in this section only need to be completed and submitted if you are
changing the shareholding ownership of all or part of your investment.
Question 6 – Investors
You are required to identify all new individuals or companies that are shareholders in the business.
In
the case of individuals the names should correspond to the names
identified on the ID pages of their passports. Contact details, and
information about citizenship and percentage ownership must be
provided. individuals or companies that are shareholders in the
business.
If a company will be a new shareholder in the
investment you must provide a listing of its shareholders and
directors, the jurisdiction where the company is incorporated, its
contact details, and the percentage of its ownership held by
non-Ni-Vanuatu citizens.
Each investor that is not a Ni-Vanuatu
citizen or registered as a company in Vanuatu must complete a statutory
declaration included on page 6 of the application form.
Question 7 – Associated businesses
In
order to get as a clear picture of the new ownership of the proposed
investment as possible, you are required to inform us of other
businesses that the proposed new shareholders in the investment are
currently involved in, whether in Vanuatu or overseas.
Question 8 – Day-to-day management
If
you intend to employ someone other than one of existing or new
investors to manage the day-to-day affairs of the business, you are
required to provide us with the name and contact details of this
individual. This lets us know who has operational responsibility for
your investment.
Question 9 – Summary
Provide
us with an indication of the type of variation in ownership you are
applying for by ticking the appropriate box, i.e. selling the entire
business or merely adding new shareholders.
In part b, you must
provide a summary of how your ownership is changing. This includes a
complete list of the existing shareholders in the business (i.e. before
the change) alongside a list of your shareholders assuming the
application is approved. The lists should include the percentage
shareholding of each investor, as well as their nationality.
In
part c, with respect to the proposed new ownership of the business, you
are required to provide us with a list of every investor who intends to
reside in Vanuatu for the purposes of implementing the investment, or a
designated manager if you answered “yes” to Q8. For each person you
list, you must indicate by ticking the appropriate box whether the
person has already been issued a residency permit associated with this
investment, or if one is required. This information gives us a clear
idea on the total number of residency permits you require, and the
number of new permits that must be issued immediately. Each person for
whom a new residency permit is being requested must provide a police
clearance.
This information is passed on to the Immigration
Department. Please note you are still required to contact the
Immigration Department and fully comply with their application process.
Section 9A of the Immigration Act CAP 66, however, obligates the
Department to issue any residency permits agreed to as part of the FIAC
as long as they meet the conditions set out in the Immigration Act.
Signature
You must sign and date page 5 of the application form.
Section 4: Variation in business activity or location
Questions
in this section only need to be completed if you propose to change the
business activities listed on your FIAC or their location.
Question 10 – Description of the new proposed investment
You
must provide us with a summary describing the nature of your proposed
new investment in the country and how it fits with your existing
activities. This will provide us with a clear picture of your
intentions.
Question 11 – Variation in business activity or location
Your
FIAC lists every business activity you are permitted to undertake in
Vanuatu, as well as the locations you can operate from. It provides us
with a transparent means of monitoring your activities in the country
and is used by authorities to issue your annual business licence.
This
question is used to ascertain which type of variation you would like to
make, and describe the proposed variation. There are three types of
variation to select from:
• Begin operation of a new business activity? – Tick the “yes” box in response to Q.11a;
• Stop operating a business activity included on your existing FIAC? – Tick the “yes” box in response to Q.11c;
•
Begin operation of a business activity for which you already have
approval, but in a new location within the country? – tick the “yes”
box in response to Q.11d.
Beginning a new business activity (Q.11a)
If
you answer “yes” to Q11.a, and you intend to start a new business
activity, you must then identify, using the list of investment
categories and business activities included in Appendix A, all the new
business activities you propose to initiate, as well as, the location
in the country you will base yourself to implement them.
With
respect to information about the location of your investment, we only
require you to identify the municipality or province from which you
will operate. In identifying your location you should select from the
following options:
• Port Vila Municipality
• Luganville Municipality
• Shefa Province (operating outside of Port Vila in Efate, Epi and Shepherd Islands)
• Sanma Province (operating outside of Luganville in Santo and Malo)
• Malampa Province (Ambryn, Malakula and Paama)
• Penama Province (Pentecost, Ambae and Maewo)
• Tafea (Tanna, Aniwa, Futuna, Erromango and Anatom)
• Torba Province (Banks and Torres Islands)
For example, if you intend to establish a hotel on Tanna, you would record:
• “D3 (code); Accommodation, restaurants and bars (category); Hotel (business activity); Tafea Province (location)”.
It
is extremely important your list of new business activities is
comprehensive and accurate. You should not hesitate to consult with a
VIPA staff person if you have any questions in interpreting Appendix A
or preparing your list.
Achieving any associated investment conditions (Q.11b)
If
any of the new business activities you identify in Q.11a are defined as
“reserved” under the Act, we need you to provide us with some further
information.
Reserved business activities are identified in
Appendix B of the application form. Some of these activities (section
1) are reserved solely for Ni-Vanuatu citizens. As a foreign investor,
you are not permitted to involve yourself in any of these activities.
Others
(section 2), however, are open to foreign investment assuming you meet
certain conditions. If you intend to operate one of these business
activities you must inform us of this intention and identify the
planned level of operation you intend to achieve. This planned level
must be greater than the minimum investment threshold that has been
set. For example, if you intend to establish a hotel on the island of
Tanna it must have a total investment of 10 million vatu or annual
sales turnover of 20 million vatu. Let’s say you propose to invest 50
million vatu in the project. You would record the following:
• “D3 (code); Hotel (business activity); Tafea Province (location); 50 million vatu (planned level of operation)”
Please
note that you must submit a business summary clearly explaining how you
to intend to achieve this planned target level of operation by the end
of your first two years of operation. If you are unable to demonstrate
achievement of the specified minimum investment within this timeframe
your right to operate in the reserved activity may be revoked.
Stopping an already approved business activity (Q.11c)
If
you answer “yes” to Q.11c, and intend to stop operating an already
approved business activity, then you must identify this activity along
with its location and associated investment category. Please note the
code, category, business activity and location must be identical to
what appears on your FIAC.
Establishing an already approved business activity in a new location (Q.11d)
If
you answer “yes” to Q.11d, and intend to establish operation of a
business activity already included on your existing FIAC but do it from
a new location within the country, then you must identify the activity
along with its location and associated investment category. Please note
the code, category and business activity must already appear at least
once on your FIAC.
Question 12 – Value of proposed investment
If
you are proposing to make a new investment, you must provide an
estimate of its total value in millions of vatu. This information
provides us with important information that is used for statistical and
monitoring purposes.
Your estimate must be broken down into
basic asset categories (i.e. land and buildings, plant and equipment
etc). In addition, you must provide an indication of the value of your
investment before and after your proposed investment is made.
Question 13 – Projected employment
Similarly,
you are required to provide a summary of the additional formal
employment that will result from your new investment. This information
is also used for statistical and monitoring purposes.
The
information should represent full-time positions (excluding any
investors) and be broken down according to their position type (i.e.
management, skilled or non-skilled) and citizenship (i.e. Ni-Vanuatu or
foreign worker). The information must also be organized to show the
number of full-time workers before and after your new investment is
implemented.
Please note as an employer you are required to
register with the Vanuatu National Provident Fund and make monthly
social security payments to the Fund on behalf of your workers.
Question 14 – Access to land
As
with Q12 and Q13, you only need answer this question if you are
intending to implement a new business activity or begin operating from
a new location.
Given the challenges that exist in obtaining a
land lease in Vanuatu, we are interested in knowing if access to land
is an important pre-requisite for your new investment, and if so, how
far along the lease process you have gone. This information provides us
with a better understanding of how long it may take you to become
operational. It also gives an indication of how we at VIPA might be of
assistance in this area.
Question 15 – Potential environmental impacts
Lastly,
we are interested in any potential environmental impacts that may arise
from your new investment. As you are aware, the promotion of
environmentally sound and safe management and conservation of the
country’s natural resources is a key objective of the Government of
Vanuatu. Assuming your application for variation is approved, and
following the full preparation of your development proposal, you are
required to consult the Environment Unit at the Ministry of Lands to
determine if a preliminary impact assessment is required. Preliminary
assessments are required only in situations where your development
proposal is likely to cause a significant environmental, social or
custom impact. The results of such an assessment will then be used to
determine if a full impact assessment is required.
By responding
to the six questions included in the application form concerning your
proposed plans, we both gain a better understanding of whether a
preliminary impact assessment will ultimately be required. If you
answer yes to any of the questions included in Q.15 there is a good
chance the Environment Unit will require this of you. In the event you
respond positively to any of these questions, you should also provide a
brief explanation of the nature of your development activity. For
example, if you propose to build wharf facilities and a fish processing
plant, you might respond:
• “ yes” to Q.15a and c;
•
“wharf facility will be constructed to accommodate long-line vessels,
and large volumes of water will be used to process fish which will then
receive primary treatment before being discharged into the ocean” (as
your explanation).
Please note that if you answer “no” to
all of the questions included in the self-assessment it does not mean a
preliminary environmental impact assessment will not be required. Once
you have obtained your FIAC, you still must consult the Environment
Unit to clarify your obligations with respect to this requirement.
Signature
You must sign and date page 9 of the application form.
Instructions for successfully completing an application form to “Renew a FIAC”
This
section will help you understand what information we need you to
provide in order to renew your foreign investment approval certificate
(FIAC) and why. It is organized according to the questions found in the
application form.
Section 1: General information and checklist
Question 1 – FIAC details
Provide
the business name under which your FIAC is issued, along with your
certificate number. You also must list all the business activities and
associated locations within the country that are identified on your
certificate.
Question 2 – Contact details
Provide
the name of the person to whom all correspondence relating to your
investment should be sent. This is also the person whom we will contact
if any issues arise as part of our monitoring activities. This person
can be the investor, a local business consultant who is acting on your
behalf, or a managing director you have hired to run the business. You
must provide us with a mailing address, telephone number and email
address.
Question 3 – Investor nationality
Identify
the country of origin of the investment by ticking the appropriate box.
In the event the investment is owned by investors from more than one
country please identify the country that represents the majority of
your shareholders. For example, if you have a total of three
shareholders, two of whom are from New Zealand and one from Australia,
you should tick the box for New Zealand. If the shareholding is equally
split between two or more countries tick the box associated with these
countries. This information is used for statistical purposes and
assists us in our promotion activities.
Question 4 – Status of investment
We
are interested in knowing what stage you are at in implementing your
investment. Please tick the box which best describes your current
situation with respect to your investment:
•
Under consideration – You have obtained a FIAC but are still exploring
your options or in the process of developing your development proposals.
•
Confirmed and implemented shortly – You have decided where and how you
will implement your investment and are in the process of establishing
your business operations, i.e. securing land or undertaking
constructing. You have not yet commenced earning income in any of the
business activities listed on your FIAC.
• Carrying on business
but not as fully planned – You are operational and earning income from
at least one planned business activity, but have been unable to
commence operations in all activities listed on your FIAC.
• Carrying on business – You are operational and earning income from all activities listed on your FIAC.
•
Carrying on business with new investment under consideration – You are
operational and earning income from all activities listed on your FIAC,
and seriously considering expanding your investment into new activities
or locations within the country in the coming year.
• Plan to divest – You intend to close or sell your business operations within the country in the coming year.
Question 5 – Checklist
You
must ensure all items identified in the checklist are appended to your
application. Immediately prior to submitting your application check to
ensure you have this information and then tick the associated box
confirming it is included in your package.
Table 6. Required supporting documents (Renewal)
| VAT returns | • Provide copies of your VAT returns submitted to the VAT Office,
Department of Customs over the past 12 month period. This helps confirm
your business is operational and in compliance with government
requirements. |
| Existing business licence | • Provide a copy of your current business licence. For businesses
located in Port Vila or Luganville, your business licence is obtainable
from the Rates and Taxes Office, Department of Customs. For businesses
located in other areas of the country it is issued by the local
Provincial Council. This helps confirm your business is operational and
in compliance with government requirements. |
Section 2: Financial information
Question 6 – Total level of actual investment
Provide
the date of your most recent financial year. Based on your balance
sheet for this ending period, provide a summary of the value of your
actual investment in millions of vatu. The total value should be broken
down into its major components, i.e. land and buildings, other fixed
assets, working capital and inventory.
Question 7 – Total level of actual employment
Based
on the monthly contribution schedules you submitted to the Vanuatu
National Provident Fund over the past 12 months, provide the number of
workers under your employ. You should exclude any investors from this
total.
The total must also be broken down according to the
number who are Ni-Vanuatu citizens and the number who are expatriates
working under work permits. Of the number of Ni-Vanuatu citizen
workers, also provide the number who are female.
Finally, provide a breakdown of the wages paid to these different employer groups over the past year.
Question 8 – Total level of actual sales
Based
on the VAT returns you submitted to the VAT Office, Department Customs,
provide the total gross sales earned in millions of vatu for the past
12 month period. Please note this figure should be consistent with
information included on your VAT returns. You are required to attach
copies of these VAT returns to your application.
Section 3: Reserved activities
Question 9 – Achievement of minimum investment conditions
If
you have been given approval to operate in a reserved activity for
which minimum investment conditions apply, you are required to provide
us with information that shows you have achieved these conditions.
If one or more business activities identified on your certificate is included on Appendix A, please tick “yes”.
If
yes, you must identify the reserved activity, its code and location,
and indicate whether you have met the minimum threshold conditions or
not, as well as the level of operation you have attained.
If you
have not yet been able to achieve the minimum threshold conditions you
must provide us with a clear explanation as to the reasons behind this
result. In addition, you must explain the steps you intend to take over
the coming year to address this short-coming.
Section 4: Plans and problems encountered
Question 10 – Difficulties negatively affecting investment implementation
Provide
comments to assist us better understand any difficulties you have
encountered over the past year in the course of implementing your
investment. Please be as specific as possible in identifying problem
areas, particularly if the issue relates to a government policy or
regulatory requirement. We are also interested in knowing how these
problems have impacted your business, i.e. delayed implementation by x
months, resulted in foregone sales of x vatu, etc.
We use this
information to gain a better appreciation for the key problems being
faced by investors in order to help us with our policy advocacy work.
Question 11 – Expansion plans
In
the event you are considering expanding your operations within the
country over the coming year, we would appreciate knowing more about
your plans. This includes a brief description of the new business
activities and/or locations under consideration, the approximate value
of this new investment (in millions of vatu) and the timeline for
implementation.
Please note if your planned expansion is in an
activity or location which is not already included on your FIAC you are
required to apply for a variation to your FIAC before you begin
implementation. We would also be pleased to discuss your plans with you
to see how we may be able to assist.
Question 12 – Plans to wind down your investment
In
the event you are considering winding down aspects of your investment
or divesting completely, we would appreciate knowing more about your
plans. This includes identification of the business activities in
question, their estimated value (in millions of vatu), and how you
intend to proceed.
Please note if you sell your business (either
in its entirety or aspects of it) you are required to apply for a
variation to your FIAC before completing the transaction.
Signature
You must sign and date page 4 of the application form.
Schedule of fees and penalty fines
Application fees
| Application for a new investment (Form 1) | VT 25,000 |
| Application to vary and existing foreign approval investment certificate (Form 2) | VT 10,000 |
| Application to renew a foreign investment certificate (Form 3) | VT 10,000 |
| Application to launch an appeal of any decision you do not agree with | VT 10,000 |
Other fees
| Issue of a new foreign investment approval certificate if it is lost or misplaced | VT 2,000 |
| Hard copy of the VIPA Act No. 15 1998 | VT 1,000 |
Hard copy of VIPA Annual Report
• Private entities
• Government departments and agencies |
VT 700
VT 400 |
Hard copy of VIPA Quarterly Report
• Private entities
• Government departments and agencies |
VT 450
VT 200 |
| For any other request for which a fee is not elsewhere prescribed | VT 10,000 |
Penalty fines
| For failing to submit an application to renew a foreign investment approval certificate within one week of its expiry | VT 100,000 |
| For failing to submit an application to vary an existing foreign
investment approval certificate before commencing its implementation | VT 200,000 |
For operating any business activity without a valid foreign investment approval certificate
| VT 500,000 |
PacLII:
Copyright Policy
| Disclaimers
| Privacy Policy
| Feedback|
Report an error
URL: http://www.paclii.org/vu/other/vipaapplicationguide.html
