St. Lucia is without a doubt one of the most beautiful islands within the Caribbean, attracting repeated awards for excellence within the tourism sector. As such, it has consistently attracted millions in Foreign Direct Investment despite the economic challenges presented by the global financial crisis. The implementation of the Citizenship by Investment Programme (CIP Programme) in 2015 has only served to further fertilize an already conducive breeding ground for successful investments on the island.
As with all investments within the tourism industry, securing initial capital can create real challenges for investors. One of the ways in which an applicant may qualify for a St. Lucian passport is to invest in any pre-approved real estate development valued at a minimum of US$300,000 for no less than five years. By attracting credible high net worth individuals seeking citizenship opportunities that suit their desired lifestyle, the CIP Programme in St. Lucia is an attractive proposition for investors with innovative real estate development options.
While there is no doubt St. Lucia is an ideal venue for real estate development, success is highly dependent on the effective management of the inherent risks involved in property development. One of the key requirements under the CIP guidelines is that the development must be a high end branded hotel, resort or boutique property. There are, however, several other conditions that must be satisfied to become an approved real estate project under the CIP Programme. To meet these requirements, Investors must consider how they structure the investment so as to ensure it is financially viable. This includes, but is not limited to, taking the following steps:
- Engaging suitable technical consultants and construction companies to ensure the project is technically and financially sound;
- Securing the necessary planning permissions and meeting all regulatory requirements;
- Applying for all applicable tax concessions available under the Tourism Stimulus & Incentives Act, including a 25 year income tax relief for the duration of the development period being a period of not more that 25 years ;
- Implementing the most tax efficient corporate structure for the investment including capitalizing on the use of offshore companies where applicable;
- Negotiating with relevant financiers and drafting, preparing and registering any agreements and/or security documents;
- Managing the various risks involved in property development with suitable contracts that avoid costly litigation;
- Securing the necessary trade licences and work permits for the operation of the resort and managing all issues relating to employment of staff;
- Utilizing the necessary dispute resolution mechanism available to minimize the impact of disputes arising whether during the construction phase or operations of the development.
The firm, Floissac Fleming & Associates established as Floissac & Giraudy in 1960, is one of Saint Lucia’s oldest and most reputable law firms in Saint Lucia. Our lawyers offer a broad range of legal services and our team has accordingly acquired, individually and collectively, significant experience in diverse areas of civil and commercial practice, civil and commercial litigation, offshore investment, construction law and arbitration in Saint Lucia. At Floissac Fleming & Associates, together with our affiliate companies Abacus Financial Services Limited and Polaris Citizenship & Investment Consultancy Services Limited which are duly registered agents under the International Business Companies Act and Citizenship by Investment Act respectively, we are well equipped to advise investors in several areas relating to property investment both within and outside of the CIP Programme. For more information on how we may assist you, please feel free to contact us at [email protected].