D’Arros: We Were Cheated Too!
Government doesn’t know what happened
The owner’s luxury villa on D’Arros Island
This week, the Seychelles Government made its first ever reference to the controversy surrounding D’Arros Island. Through the SBC, and using the office of the Registrar, it confirmed that it did not know what had happened to the island. If the ownership of D’Arros had changed from the Pahlavi family of Iran, then Seychelles would be due to collect duty on the transfer, the report said. But by now everyone knows that D’Arros is the property of Lilianne Bettencourt, the L’Oreal heiress embroiled in a tax scandal in France.
Since ownership changed, then we were defrauded too. The Government should be able to give a direct answer.
The statement made clear that Seychelles did not know what the position was regarding the island. While the French authorities are pursuing the with investigations in the financial transactions which include D’Arros, the Seychelles Government needs an enquiry too to establish what happened.
The Government should not have any doubts about where things stand. The reports of Lilianne Bettencourt having acquired D’Arros have been around for a number of years during which time she is supposed to have stayed on the island on several occasions. Government should have known of any change of ownership and stamp duty paid should have been claimed.
The situation in fact shows another gap in the laws regarding land transfer. While sales of land itself are normally recorded promptly in the registry, there is a way in which this is often avoided. It is when the property is owned by a company, and then shares in the company are transferred to another party. In this case, the company owning the land remains the same, so there is no change in the land registry itself. But the transfer of shares means a change of ownership which should be declared and on which stamp duty should be paid. In our system, the declaration becomes public only when the annual financial returns, which lists the names of shareholders, are filed. This should normally be in the following year.
The problem is that many companies do not file annual returns regularly and promptly. Some are years in arrears. This may be a deliberate way of avoiding a revelation of change of ownership and, from our observations, it has been used often by Government officials to hide their interests in share transfers.
This is the occasion not only to pursue the matter of D’Arros, but to revise the laws to require more transparency in the real owners of companies.
Source: Regar 7-16-10