The sudden outbreak has left individuals and ... - Business Mauritius€¦ · Through this FAQ our lawyers provide answers to a wide range of legal questions which may arise as a

The sudden outbreak has left individuals and businesses with many pressing

questionsthatneedanswers.

Through this FAQour lawyers provide answers to awide range of legal questions

whichmayariseasa resultof the impactofCOVID19onbusinesses. Shouldyou

require legaladvice in respectof the impactofCOVID19onyourbusinessdonot

hesitatetocontactanyofourlawyerslistedbelow.

ContactourLawyers’TeamIqbalRajahbalee-SCManagingPartnerE:[email protected]

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MushtaqNamdarkhanPartnerE:[email protected]

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ValerieBisasurPartnerE:[email protected]

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T(+230)4032400F(+230)4032401Wwww.blc.mu

Thecontentofthisdocumentisintendedtobeofgeneraluseonlyandshouldnotberelieduponwithoutseekingspecificlegaladviceonanymatter–(26March2020)

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FAQsONIMPACTOFCOVID-19ONMAURITIANLAWS

A. EMPLOYMENT

Questions Answers1. Cananemployerbelegally

compelled to notify thelocal health ministry,either proactively or inresponsetoarequestfromthe ministry or othergovernmentagencyincasean employee is infectedwiththeCOVID-19virus?

TheemployerisnotlegallycompelledtonotifythehealthministryincaseanemployeeisinfectedbytheCOVID-19virus,unlessinresponsetoarequestfrom the relevantministry or authority. The Employerwill only be able tostatethattheemployeehassymptomsbutwillnotbeabletoascertainthattheemployee is infectedwithCovid-19as the test isonlybeingcarriedbytheofficersoftheMinistry.

2. Is an employer legallyobligated to notifyemployees if any of theiremployeesisinfectedwiththeCOVID-19virus?

An employer is not legally obligated to notify employees if any of theiremployees is infected with the COVID-19 virus but the employer shouldappropriatelydisclosethatsomeoneintheworkplacehasbeenexposedtoCOVID-19, without disclosing the identity of that employee in order toprotect their privacy. The employer should advise employees to self-quarantineinsucheventandseekmedicaladviceorcontacttheMinistryofHealthiftheyhaveanysymptomsofthevirus.

3. Is there an obligation tocloseaplaceofwork ifanemployee is infected? Atwhat stage can theemployerreopentheplaceofwork?

The Occupational Health and Safety Act 2005 (OSHA) imposes a duty onemployers to ensure the safety, health and welfare at work for allemployees. The OSHA states that employers must, as far as practicable,provideandmaintainaworkingenvironmentthat issafeandwithoutriskstohealth. Given thegravityof theCOVID-19, theemployermayhavenootheroptiontoclosedownuntilthepremisescanbethoroughlycleanedinaccordancewithWHOstandards.

4. Are there any issues withforcingemployeestoworkfromhome?

Employmentcontractsoftenprovidethattheemployee’splaceofworkshallbe[x]orsuchotherplaceastheemployeemaybenotified.Insuchcase,anemployermayrequireitsemployeestoworkfromhome.Evenwithoutsucha provision, if the reason is to ensure the health and safety of theemployees,anemployerwouldhavegoodgroundsforrequiringemployeestoworkfromhome.TheprevailingsituationinMauritius,inthelightofthedirectivesandorders issuedby the relevantauthorities, call foremployeesto work from home (unless the services provided by the employers aredeemedessential)isclearlygoodreasoninthecurrentcircumstances.


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Questions Answers5. How can employers cut

wagesforemployees?Forexample, can employeesbe asked to stay awayfromworkinexchangeforreduced pay withouttriggeringredundancies?

Anemployermayrequireanemployeetostayawayfromtheworkplaceasexplained above. However the reduction of wages unilaterally withouttriggering a redundancy would require the consent of the employee.Howevertheemployermayrequireaworkertoworktemporarilyforatimeshorter than that specified in the agreement at a reduced remunerationsubjecttotheapprovalofthesupervisingofficeroftheMinistryresponsibleforthesubjectoflabourandemploymentrelations.

6. Can employers forceemployeestogoonforcedpaidleave?

Foremployeeswhosemonthlybasicsalary isMUR50000or less, the lawprovidesthatwhereanemployerandanemployeeareunabletoagreeastowhentheleaveistobetaken,halfoftheleaveperiodshallbefixedbythe employer and the other half by theWorker.Hence the Employer canforce the employee to take half of their leaves entitlement. For thoseemployeeswhosebasicsalaryismorethanMUR50000amonth,itwillbecontractualandsubjecttothetermsoftheemploymentagreement

7. Can employers forceemployeestogoonforcedpaidleaveorunpaidleaveduringthistime?

The answer provided to question 6 will not be applicable in the currentsituation. In the current context where there is a curfew or even in asituation of a lock down where businesses are closed, it would not bepossible foremployer to forceemployees to take their leavesentitlementbyvirtueofthefactthatgiventhenatureofthejob,theemployeescannotworkfromhome.

8. Canthequarantineperiodbe deducted from anemployee’s annual leaveor sick leave?What if theperiod exceeds theemployee’s sick leaveentitlement?

Itwould be on case-to-case basis as towhether the quarantinewould beconsideredassickleave.Iftheemployeebywayofprecautionarymeasurehasdecidedtoself-quarantine,thenitmaynotbeconsideredassickleavebut will have to take his annual leave. In the event the Employee hasexhausted his annual leave or sick leave entitlements, then it would beleavewithoutpay.

9. Cantermsofemploymentbe renegotiated duringthis period of thepandemic?

Anytermsrenegotiatedwillhavetobewithconsentoftheemployee

10. Can employees be askedto reduce the number ofhours they work so thattheyarepaidbasedonthenumber of hours worked(salary is reducedaccordingly)?

Intheabsenceofmutualconsent,theemployermayrequiretheemployeetowork temporarily for a shorter time than specified in the employmentcontractatareducedpay,subjecttotheapprovalofthesupervisingofficeroftheMinistryofLabour.


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Questions Answers11. Doemployersstillneed

to pay full salaries toemployeesifthenatureoftheir job isthattheyare unable to workremotely but need tostay home to be safefromthevirus?

Yes,employersstillneedtopayfullsalariestoemployeesifthenatureoftheirjobisthattheyareunabletoworkremotelybutneedtostayathometobesafefromthevirusasaresultoftheconfinement/curfew.

12 Whatdutyofcaredoesan employer owe totheir employees duringthis time? Accordingly,what liabilities ariseonan employer if anemployee is infectedattheplaceofwork?

TheOccupationalHealthandSafetyAct,2005(OSHA)imposesalegalobligationonemployerstotakevariousmeasurestoensurethattheworkplaceissafeforallemployees.EmployersmustthereforeputinplacemeasurestoprotecttheiremployeesfromthespreadofCOVID-19attheworkplace.AbreachoftheOSHAmayresulttoafineofnotexceedingMUR75000andimprisonmentnotexceedingoneyear.

13. Can employees whocannot work remotelybe forced to takeannualleaveduringthisperiod?

It will not be possible for employers to force employees to take annualleavesinthesituationofacurfew/confinement.

14. Can employers makeemployees redundantmerely due to the factthatapandemicexists?

Employersmayterminateemployees’employmentcontractsonaccountofredundancyprovidedthattheybelievethatitisforareasonablecauseandthat theyareable todemonstrate that there isavalid justification for theproposedredundancysubjecttostrictcompliancetothestatutoryprocesslaiddownintheWorkers’RightsAct2019.

15. What is an employeeentitled to when theyare working remotely?What are the benefitsanemployeeisentitledto when workingremotely?

Employees are entitled to their usual employment benefits as stipulatedundertheiremploymentcontracts(suchassalariesandleaveentitlementsetc.) when they are working remotely. They would not, however, beentitled to benefits that require that they are physically present at theworkplacesuchastransportifthereisaclearprovisionintheemploymentagreementtotheeffectthatthetransportallowanceisforattendingwork.

16. Should an employerhave a written COVID-19policy?

Yes,itisrecommendedforemployerstohaveawrittenCOVID-19policyasameasure to help protect workers from infection and protect employersfromliability.


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Questions Answers17. Would directors and officers

be held liable for not doingenough ifsomeonecaughtthevirusandspreadtootherstaffmembers?

Any personwho, at the time of the commission of the offence,wasconcerned in the management of the body corporate may be heldliable unless he shows that the offence was committed without hisknowledge and/or that he took all reasonable steps to prevent thecommissionoftheoffice.

18. Can an employer make anemployee perform other jobswhen their core functions aredown (for examples, if salesaredown)?

Anemployermaymakeanemployeeperformother jobswhen theircorefunctionsaredownbutmustconsultandobtainconsentwiththeemployee prior to making any amendment to his duties andresponsibilities.

19. Whatshouldanemployerdoifan employee doesn't want tocome atwork because he/sheis afraid of being infected attheworkplace?

Employees are not allowed to be away from the workplace withoutcause. If the employee is afraid to be infected, the employee shalltakehis leaveentitlements. In theevent that theemployeedoesnothave any leave entitlements and the employer refuses to provideemployees leavewithout pay, the employermay initiate disciplinaryactions.


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B. REALESTATEANDCONSTRUCTION

Questions Answers1. What are the obligations of

landlords and tenants inrelation to minimising thespread of the COVID-19 virusat the building or the leasedpremises?

The duty is on employers under the section 5 of the MauritianOccupational Safety and Health Act 2005 to provide and maintain aworking environment that is safe and without risks to health. Theemployer should also provide information, instruction, training andsupervision as is necessary to ensure the safety and health at work ofemployees, and ensure that any person not in his employment is notexposedtoanyriskofsafetyorhealth.Wheresanitaryconveniences,washingfacilities,facilitiesforthetakingofmealsormessareused incommonbyseveral tenants, theownerof thebuildingshallberesponsiblefortheircleanlinessandmaintenance.

2. Can the Government orderthe closureof thewholeorapartofabuilding?

The Public Health Act contains provisions for the closure of a dwellinghousewhich is unfit for human habitation. The Permanent Secretary oftheMinistry of Healthmay,with the approval of theMinister order thedestruction, evacuation, burning or disinfection by steam or any othermeans,ofanyhouse,hut,building,orpremisesand itsappurtenancesorground, or the houses or buildings adjacent thereto — (i) in which hebelieves that any person suffering or suspected to have been sufferingfrom plague has been residing; (ii) which he has been occupyingpermanentlyortemporarily;or(iii)whichhebelievestobeinfected.Underregulation16ofthePreventionandMitigationofInfectiousDisease(Coronavirus)Regulations2020,whereitappearstotheMinisterofHealththatpremisesarebeingusedforanypurposeorinanymannerwhichmaylead to the spreadof coronavirus,hemay,byGeneralNotice,order thatthepremisesbeclosedorremainclosedornottoadmitcustomersthereinasmaybereasonablynecessarytopreventthespreadofcoronavirus.

3. Can a landlord unilaterallydecidetoclosethewholeorapartofabuildingtohelpstopthe spread of the COVID-19virus?

Subject to the express provisions of the lease and in the absence of aGovernment directive under the Prevention andMitigation of InfectiousDisease (Coronavirus) Regulations 2020, if a landlordunilaterally decidedtoclose theentireorapartof thebuilding thataffects theabilityof thetenanttousetheleasedpremises,thelandlordcouldpotentiallybeliablefor the breachof the landlord’s obligation to allow the tenant quiet andpeacefulpossessionoftheleasedpremises.Insuch


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Questions Answers instancesthetenantwouldbeentitledtoexercisetheremediesprovided

undertheleaseandunderthelaw.Anysuchclosuretotheextentthatitaffectsthetenant’suseoftheleasedpremises should ideally be done in consultation with and with theagreementofthetenant.

4. Can a tenant unilaterallydecide to shut itspremises tohelp stop thespread of the COVID-19virus

The tenant cannot unilaterally do so, unless contractually agreed in thelease agreement. Currently, given the prevailing curfew order andcompletelockdown,buildingsaremandatorilyclosedbylaw.

5. What is the effect on co-tenancyclauseswheretheGovernment directs theclosure of the whole orpart of a building orwhere the other tenantsinthebuildingunilaterallydecide to close theirleasedpremisesandceasetrade?

Thepositionwoulddependonwhetherprovisionsaboutco-tenancyhavebeenmade in the lease agreement. Currently, in view of the prevailingcurfewandcompletelockdown,buildingsaremandatorilyclosedbylaw.

6. Cana tenant suspend thepayment of rent claimingthat the Covid-19 givesrise to a force majeureevent?

Ifthecontracthasprovidedforsuspensionofpayments,e.g.asaresultofa curfew or lockdown ordered by Government to prevent the spread ofCovid-19,thetenantcanavailitselfofthatclause.Intheabsenceofsuchaclause, thetenantcanrelyon forcemajeureasaconceptunder theCivilCodebutwouldhavetoprovethatthecurfew/lockdownissomethingthatwasunforeseeableandirresistiblewhichhaspreventeditfrompayingtherent;itmaybedifficulttoestablishthatinrespectofapaymentobligationhowever.

7. What happens if there isfailuretoprovidebuildingservices, includingmaintenance, cleaning,sanitation, and securityduetoCOVID-19?

Responsibility for the provision of services for a multi-tenant building,includingmaintenance, cleaning, sanitation and security for the commonareasarenormallysetoutinthelease.Landlords may, in the lease agreement, exclude liability for failure toprovideserviceswherethecessationoftheservicesisduetofactorsoutofthecontrolofthelandlordorduetonofaultonthepartofthelandlord.Thisisrecognisedonthebasisthatthelandlordisnotpersonallyprovidingtheservicesandthatthelandlordhasnodirectcontroloverthethirdpartyservicevendors.Practically, however, the landlord would take all reasonable stepsnecessarytorestoretherelevantservicestotheextentpracticableasitisnotinthebestinterestofthelandlordtoletitsentirebuildingdeteriorate.Thisisbecausethelandlord’sinterestintheentirebuildingismuchgreaterthananyoneindividualtenant’sinterestinaportionofthebuilding.


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Questions Answers8. If an individual tenant or

an employee of thetenant contracts COVID-19,canalandlordprohibitthe tenant or itsemployee from accessingthebuilding/premises?

Thelandlordwouldhavenosuchpowerorentitlement.Itwouldbeuptothe tenant, as employer, to take steps to protect the health of itsemployees and third parties, as per section 5 of theOccupational SafetyandHealthAct.

9. What alternativeremedies can I consider ifmy contract/lease doesnotentitlemetosuspendmyobligationsonaccountofforcemajeure?

Onemay rely on forcemajeure as a civil law concept, namely an eventwhich is unforeseeable and irresistible which is such that it preventsperformanceof contractualobligationsduring theperiodwhile the forcemajeureeventisongoing.

10. What should real estatedevelopers withdevelopment loans do inview of the loomingslowdown in housepurchaseuptake?

On13March2020,theBankofMauritiusannouncedaseriesofmeasuresthatwouldalleviateeconomicoperatorsimpactedbyCovid-19,namely:

(a) AspecialfacilityofRs5billiontobeavailablethroughcommercialbanks at interest rate of 2.5% per annum payable over 2 years.Thefacilityisavailablebetween24Marchand31July2020,andamoratorium of 6 months is available on capital and interestrepayments. Operators can contact their banks to availthemselvesofsuchfacility;

(b) Reductionofthecashreserveratioofcommercialbanksfrom9%to8%;and

(c) Commercial banks to provide a six-monthmoratoriumon capitalrepaymentsofexistingloansofoperatorsimpactedbyCovid-19.

On20March2020,theBankofMauritiusannouncedfurthermeasures:

(a) households affected by Covid-19may request their commercialbanksfora6-monthmoratoriumoncapitalrepayments;

(b) the Bank of Mauritius will bear interest repayments ofoutstandinghousehold loans from01April to30 June2020, forhouseholdsearninguptoRs50,000amonth;the Bank of Mauritius will make a USD 300 million foreigncurrency line available through commercial banks to operatorswithforeigncurrencyearnings. SuchfacilitywillbearinterestatUSD6monthLIBOR,beavailablebetween24March2020and30June2020,andrepaymentwillbeover2years;and

(c) introductionof a swaparrangement through commercial banks,foraninitialamountofUSD100milliontoassistimport-orientedbusinesses. The arrangement is available between 24 March2020and30June2020.


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Questions Answers

11. How are payments underthe sale agreementaffected if thecompletiondate falls during a periodwhen the lands registriesareclosed?

Thiswill vary fromone agreement to another depending on the specifictermsoftheagreement:a) Foracashtransaction,apurchaser’sobligationtopaythebalanceof

the purchase price is normally pegged to the completion date inexchange for the release of the completion documents. In somecircumstances, parties agree that the entire purchase price or aportion of it can be released to the vendor on the completion dateuponreleaseofthecompletiondocumentstothepurchaser.However,it is market practice for the deposit and the balance to be held inescrowpendingtheregistrationofthetransfer.

b) Inafinancedtransaction,thepurchasernormallypaysthedepositintoescrow and on the completion date procures a financial undertakingfrom its financier to make payment of the balance of the purchasepricetothevendorontheregistrationofthetransferinfavourofthepurchaser and the charge in favour of the purchaser’s financier. Thevendor would not be entitled to the entire purchase price until thetransferandthechargehavebeenregistered.

c) TheclosureoftheofficesoftheRegistrar-GeneralandConservatorofMortgages in both instances has the effect of delaying the stampingand registration of the transfer and the charge (if applicable) andconsequentlythereceiptbythevendorofthepurchasepriceandthegranting of possession of the property to the purchaser. Both thevendor and the purchaser should have a discussion on how best tomanage each party’s expectations and timelines for completing thetransactionastheclosureandthereopeningofthe landsregistries isnotinthecontrolofeitherparty.

d) The provisions of the agreement for sale on time prescribed for

registering the transfer should also be reviewed so as to provide foradditionaltimeifrequired.


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Questions Answers12. Howdoesthecurrentclosure

of the lands registries andvarious governmental officesaffect completion in varioussale and purchasetransactions?

The following issues should be considered when bearing in mindcompletionforapropertysaletransaction:i. in a financed transaction, the completion period should give

sufficienttimeforthebanktocompleteitsduediligence(ifthishasnotalreadybeendone)oncethelandsregistriesreopen;

ii. the completion period should also give sufficient time for thevendor to procure the various completion documents once theoffices of the Registrar-General and Conservator of Mortgagesreopen;

iii. whether anyof the completiondocuments thatmayhave alreadybeenprocuredwouldexpirepriortothere-openingoftheofficesoftheRegistrar-GeneralandConservatorofMortgages;and

iv. timeprescribedforregisteringthetransferIftheagreementforsalehasalreadybeenexecutedandthecompletiondate will occur prior to the reopening of the offices of the RegistrarGeneralandConservatorofMortgages,thenpartieswillneedtodiscussproviding an extension of time to a more realistic date so as to alloweachpartytocomplywithitscompletionobligations.

13. How does closure ofregistriesaffectthehandoverofpossessionofthepropertyonasaletransaction?

Itismarketpracticeforpossessionofthepropertytobegrantedbythevendortothepurchaseroncompletionoftheregistrationofthetransferandreleaseofthepurchasepricetothevendor.Asmentionedabove, theclosureof theofficesof theRegistrarGeneralandConservatorofMortgageshas the impactofdelaying thestampingandregistrationformalitiesonthetransferandconsequentlythereleaseofpurchasepricetothevendorandgrantofpossessionofthepropertytothepurchaser.Shouldthepurchaserwishtotakepossessionofthepropertypriortotheregistration of the transfer then this may be made conditional on thereleaseof thepurchasepriceand thepurchaserwould take the riskontheregistrationofthetransfer.Alternatively, the purchaser may occupy the property prior to theregistrationofthetransferasatenantandpayrenttothevendor.Inthissituation, while the vendor enjoys an additional revenue stream (forwhat is hoped to be a short period), the vendor takes on the risk ofvacatingthepurchaserifthetransactionisnotcompletedduetonofaultonthepartofthevendor.


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Questions Answers

14. What steps if any is theMinistry of Housing andLands taking to helpwiththe registration ofdocumentsthatmayhavestatutory or contractualtimelines?

Nosuchmeasureshaveasyetbeencommunicated.

15. Is COVID-19 covered bybusiness interruptioninsuranceandwhat is thethresholdforrecovery?

Theclosureofacommercialbuilding/mallbytheGovernmentpursuanttoapublichealth/quarantineordermaytriggeraninsuranceclaim.However, thiswould be subject to the terms of the individual insurancepolicyandonewouldneedtoreviewtheirinsurancepolicyandcheckwiththeir insurers or insurance brokers on whether the insurance policyincludes losses caused by pandemics or closure of businesses due to apublichealthquarantineorder.Landlords and tenants may need to review their business interruptioncovertoconfirmthatitwillallowthemtorecoverlosses(includinglossofrentandprofit)sufferedduetobuildings/commercialcentres/mallsbeingclosed.


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C. CORPORATE

Questions Answers1. Is the COVID- 19 pandemic

an event which is a forcemajeure or is it an Act ofGod?

Itdependsonhowthecontract isdraftedandwhat is includedaswithinthe categories of “force majeure” and “act of God”. If the contract issilent,theCivilCoderecognisestheconceptofforcemajeureasadefencewhichexcusesacontractingparty fromperforming itsobligations. Forcemajeurethenpreventsthepartywhohasbeenpreventedfromperformingfrombeingliabletotheothercontractingparties.Foraneventtoamountto forcemajeure under the Civil Code, itmust be unforeseeable (at thetimeofconclusionofthecontract)andirresistibleandsoastopreventtheaffected party from performing its obligations. It only exonerates thecontractingpartyfromperformanceduringtheperiodforwhichtheeventlasts.

2. What if my contract doesnot have a force majeureclause?

The position would be governed by articles 1147 and 1148 of the CivilCode,whichhavebeensummarisedabove.

3. Canacontractbesetasideifapartycannotdelivergoodsor serviceson timebecauseofthepandemic?

Given theprevailing curfewwhich is restricting themovement of peopleand goods within the territory ofMauritius, this would likely be a forcemajeureeventwhichpreventsasupplierfromdeliveringgoods.The court would not set aside such a contract if, after the curfew, thesupplierisreadyandwillingtoperformitsdeliveryobligations,anditisstillpossiblecontractuallytoperformthoseobligations.

4. Canapartysuspenditsnon-monetary obligations underacontractinlightofCOVID-19?

Ifthecontract issilent,theprovisionsoftheCivilCodeonforcemajeure,as interpretedby case law,will apply. Themereoccurrenceof Covid-19would not be sufficient to justify a suspension of non-monetaryobligations, as the affected party would need to show how anunforeseeableandirresistibleeventhascausedittobeunabletoperformitsobligations.Rather,Governmentimposedmeasuressuchasregulationson quarantine, lockdowns and curfews would in most cases physicallypreventtheperformanceofcontractualobligations.It is open to contracting parties to have provided more detail in theircontracts on how an epidemic or outbreak of disease can, if at all,temporarilyexcuseperformanceofobligationsbyacontractingparty.

5. Can a party suspend itsmonetary obligations underacontractinlightofCOVID-19?

ApartywouldneedtorelyonthecircumstancesmentionedinQ.1aboveinordertosuspenditsobligationsunderacontract.


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Questions Answers Torelyonaforcemajeureevent,theeventmustpreventperformanceof

the specific obligation. Since the funds transfer system remainsoperational (albeit subject to fewer bank staff working), it is generallydifficult to rely on force majeure provisions to suspend paymentobligations. Parties should therefore consider the wording of the forcemajeure clause to confirm if the clause exempts obligations relating topaymentofmoney.In addition, the party should also consider if the provision exempts anyunpaidfinancialobligationsincurredpriortotheeventbeingreliedon.Forinstance, if the clause only relates to obligations arising on or after therelevant forcemajeure event, the clause cannot be relied upon to avoidunfulfilledobligationsthatarosepriortoCOVID-19.Lastly,thepartyshouldcheckiftheforcemajeureclausecoversbothpartiesoronepartyasthiswillhelpestablishwhichobligationsarecovered.

6. In what circumstances cana party rely on forcemajeure in order tosuspend its obligationsunder a contract? Whatconditions need to befulfilled?

UndertheCivilCode,theaffectedcontractingpartymustshowthatitwaspreventedbyaneventwhichwasunforeseeable(atthetimeofconclusionofthecontract)andirresistible,throughnofaultofitsown,toperformitscontractualobligations.That party is then excused for the duration of the force majeure eventfromany liabilitythataccruestothenon-affectedpartyasaresultofthenon-performance.

7. WouldCOVID-19constituteforcemajeure?Whatarethethresholdsforforcemajeure?

TheoccurrenceofCovid-19itselfwouldnotbeaforcemajeureevent,asitwould not be an irresistible event which prevents performance of acontract(unlessthecontractingpartyisanindividualwhoishimselflaidupwiththeinfection).However,Governmentmeasurestakentopreventthespreadof thediseasesuchas lockdownandcurfewsmaymesufficientlyserious to meet the thresholds of unforeseeability and irresistibility toamounttoforcemajeureevents.

8. In what circumstances canapartyrelyontheprincipleof frustrationof a contractwith respect to COVID-19andifsoonwhatbasis?

ThereisnoconceptoffrustrationofcontractsinMauritius.Ifthecontractissilentandaforcemajeureeventlastsforalongtime,or(evenifitlastsforarelativelyshorttime)issuchastohaverenderedtheperformanceofacontractnugatory,anyoneofthecontractingpartiescanapplytocourtfortheterminationofthecontractunderarticle1184oftheCivilCode.

9. If a counterparty to acontractrefusestomeetitsobligations under thecontractbecauseofCOVID-19,whatrecoursedoestheotherpartyhave?

Insuchacase,thedisgruntledpartycansuetheotherpartyforbreachofcontract and claim damages or specific performance (depending on thenatureofthecontract),orexerciseanyotherremediesavailableunderthecontractorunderlaw.


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Questions Answers

10. WithrespecttoregistrationofdocumentsundertheCompaniesAct:(i) What happens to

the requirement toregister documentswiththeRegistrarofCompanies (whereofficesareclosed);

So far, the Registrar of Companies has issued a communique extendingthedeadlinebywhichcompanieswithyearendof30Septembercanfiletheirfinancialstatementsandfinancialsummariesto27April2020.

(ii) Are penaltiesapplicable for latepayment of stampduty during theperiod of COVID-19and can one get awaiver of penaltiesunder applicablelegislation?

So far, no communiquehasbeen issuedby theRegistrarGeneral aboutwaiverofpenalties. Induecourse, representationscanbemade to theMinister of Finance and Registrar-General to apply such a waiver inrespectofthelockdownperiod.

11. If one has entered into acommercialcontract(e.g.aShare PurchaseAgreement)thatispendingcompletion, would theoutbreak of COVID-19 bedeemed to constitute amaterial adverse change(MAC) entitling a party toterminate the agreement/delay completion? Whatother recourse would youhave?

AMAC clause is a provision in a contract that allows a party to eitherrescind a contract or vary the contractual terms if there is a materialadverse change in the business or prospects of the relevant asset inquestion(beitsharesinacompany,propertyorevenentryintoofajointventure).Rarelydoes theMACclearly and specificallydefine theeventsthatconstituteaMACortheamountoflossofvalueofatargetbusinessthatwould constituteaMAC. In theeventof adisputeas towhetheraMAChasarisen,thecourtshavetoconductaninquirybasedonthefactsoftheeventinquestiontodetermineifthateventconstitutesaMAC.


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Questions Answers In order to rely on a MAC, this must be specifically included in the

underlyingcontract.COVID-19 has been declared a pandemic by the World HealthOrganization. Many businesses have been adversely affected by thepandemic due to reasons such as lock downs and business supplydisruptionsandareexperiencingorareanticipatingfinancialdownturnsduetoCOVID-19.Despitetheforegoing,theeffectsofthepandemiconthe earning potential of businesses and industries in the long term isunknown.Itisunknownhowlongthepandemicwilllastanditslongtermeffectontheglobaleconomy.TheabilityofapartytosuccessfullyclaimthatCOVID-19constitutesaMACwillneedtobeassessedonacase-by-case basis taking into account the individual circumstances of theparticular matter and the effect that COVID-19 will have had on theirbusiness,assetsoroperations.In the event that a party was aware of the COVID-19 outbreak whenentering into the relevant contract, itwould be evenmore difficult forsuchapartytorelyontheMACclause.

12. WhataretheeffectsofCOVID-19ondelaystoobtainregulatoryapprovalsthatareconditionprecedent(CP)tocompletion?

ItshouldbenotedthatasresultofCOVID-19andthevariousdirectivesthathavebeenissuedbytheGovernmentinresponsetoCOVID-19,alotoftheGovernmentoffices(includingregulators’offices)areclosedandalot of the normal services are unavailable at this time. This is likely toresult in delays in procuring regulatory approvals required in order toconsummatetransactions.Please refer to our response toQ.1 above. A party could rely on forcemajeureinordertosuspenditsobligationsunderacontractortoextendthe timeline for completion (if this right exists under the contract). Aparty can terminate the contract if a right of termination has beenprovidedforinthecontract;otherwise,terminationcanonlybeorderedbytheCourtunderArticle1184oftheCivilCode.Thepartiestothecontractcouldalsomutuallyagreeinwritingtodelaycompletionofthetransactionandextendthetimelinesforthefulfillmentof the CPs awaiting further developments on the measures thatgovernmentwilltaketocontainCOVID-19.Inaddition,contractingpartiesneedtoact ingoodfaith. Acontractingpartywhounreasonably refuses toextendthedate forcomplianceofaconditionprecedentbecauseof the lockdowncouldbe regardedasnothaving acted in good faith (which is potentially a breach of contract initself) or in abuse of its rights (which is a potentially a tort underMauritianlaw).


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13. Forpurposesofinterpretingaforcemajeureclausethatincludesan“epidemic”asanevent,canitbearguedthatthereiscurrentlyan“epidemic”inMauritius?

Section 78 of the Public Health Act provides that where any part ofMauritiusappearstobethreatenedwith,orisinfectedbyanydangerousepidemic,endemic, infectiousorcommunicabledisease, theMinisterofHealthmaybynoticepublished in theGovernmentGazette,direct thatsections79to83oftheActshallbeapplicabletoMauritiusorsuchareaofMauritiusasmaybe specified in thenotice. TheMinistergave suchnoticeon19March2020,applicabletothewholeofMauritius.


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D. INSURANCE

Questions Answers1. Is business interruption

covered in insurancepoliciesinMauritius?

Thiswilldependonthespecificcontentsofeachspecificinsurancepolicy.

2. Would the cover extendto interruption caused bytheCOVID-19pandemic?

The terms of each policy have to be examined, policy-by-policy. It is notpossibletogiveageneralanswer.

3. What should businessesdo/consider in relation totheir insurance policies inlight of the COVID-19pandemic?

Businessesshoulddothefollowing:a) Carefullyreviewalongwiththeiradvisersthetermsoftheirexisting

coverage to establish whether business interruption relating toCOVID-19orepidemicsgenerallywouldbecoveredorexcludedfromcover andwhether, even if theremay be no exclusion from cover,whetherproofofphysicallossmayaffecttheabilitytorecoverfrominsurance.

b) Goingforward,businessesshouldavoidgenericpoliciesandcarefullythink throughthepractical risksand losses theyare likely to face inanenvironmentwheresuchepidemicsanddiseaseoutbreaksarenolonger‘blackswan’eventsandstructuretheirinsurancecoveragesoastoeffectivelyrespondtotheserisks.

c) Insurers, insureds and brokers should work together to evaluate

whetherthepresentindustrystandardformsofcommercialpropertyandbusiness interruptioncoverare‘fitforpurpose’andtoconsiderdevelopingproducts that address thepractical risks thatbusinessesarefacingatpresentandarelikelytofaceinthefuture.

d) For instance, consideration could be given to cover endorsementsthatextendcovertoacontingentbusinessinterruption,thatis,coveris extended to a business where its key suppliers (rather than thebusiness itself) suffer physical losses to their property that impairsthesupplier’sabilitytodelivercontractedgoodsormaterials.

e) Considerationcouldalsobegiventoextensionofcovertosituationswhere although there has been no physical damage, governmentalaction such as a lockdown orders as part of epidemic containmentmeasures,affectsaccesstooruseoftheinsured’sbusinesspremises.


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Questions Answers

4. In the case of InsurancePremium FinancingArrangements, if theclient does not meet hismonthly payments,would the insurers becalledupontocancelthepolicies and refund thepremiumdue?

TheMauritiusCivilCodeprovides foramechanismtocancelpolicies.A firstnotice requestingpaymenthas tobesent,and it isonly if this firstnotice isnot complied with that the insurance policy can be cancelled for nonpayment.


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E. COMPETITION

Questions Answers1. What happens to

mergers being evaluatedby the CompetitionCommissionofMauritius(the ‘CCM’) in the eventof a lock down/ closureoftheCCM?

As at 26thMarch, 2020, the CCM had not issued any statement providingguidance on howmerger assessments will be conducted in the event of alockdown. However, parties should envisage the possibility of mergerevaluationsbytheCCMbeingdelayedorcompletelystalledasaresultoftheongoinglockdowninMauritiusasaprecautionarymeasureagainstCOVID-19pandemic.Fortunately, the Competition Act 2007 (the ‘Act’) does not provide fornotifications or approvals to be obtained from the CCMprior to amerger.TheActenablesapartytoamergertoapplyforguidanceastowhethertheproposedmergerwillresultinasubstantiallesseningofthemarket.Although not mandatory, notifying before completion of the transactionbrings severalbenefits like certainty to the transaction, the transaction canbe tailormade taking intoaccountconcernsof theCCM, ifany, thecostofimplementing remedies of the CCM is lower before completion of thetransactionandfollowingtheguidanceoftheCommissioninformeddecisioncanbetaken.TheCCM isexpected tocomplete itsmergerassessmentwithin30workingdays after the receipt of the notification; and in the case of a detailedassessment it shouldnotexceed sixmonths.However, the responseof theCCMmaybedelayedduetothelockdowninMauritius.NotethattheCCMhaspowerto investigatecompletedmergersandhas itsownmechanismtodetectmergerswhichhavenotbeennotified.

2. How will mergerapplications besubmitted to theCCM inthe event of a lockdown/ closure of theCCM?

The CCM is yet to issue a statement providing guidance on how mergerguidancewillbesubmittedintheeventofalockdown.

3. What kind of conduct isbusiness is prohibitedand is likely to attractinvestigations orimposition of sanctionsby the CCM during thisperiodofCOVID-19?

RestrictiveBusinessPractices

(a) HorizontalAgreements: Section41of theActprohibitsagreementsor a provisionof such agreements betweenenterprises that supplygoods or services of the same description, or acquire goods orservicesof thesamedescription,whichhave theobjectoreffectofsignificantlypreventing,restrictingordistortingcompetition.


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Questions Answers (b) Bid Rigging: Under section 42 of the Act, an agreement shall be

prohibitedandvoidwhereonepartytotheagreement:i) agrees not to submit a bid or tender in response to an

invitationforbidsortenders;orii) agreesupontheprice,termsorconditionsofabidortender

tobesubmittedinresponsetosuchacallorrequest.(c) VerticalAgreements InvolvingResalePriceManagement:According

to section 43 of the Act, a vertical agreement between enterprisesshall, to the extent that it involves resale price maintenance, beprohibitedandvoid.

(d) Non-CollusiveHorizontalAgreements:Ahorizontalagreementthatisnotcollusiveundersection41oftheActmaybereviewedbytheCCMwhere-(i) thepartiestotheagreementtogethersupply30percentormore,

or acquire 30 per cent or more, of goods and services of anydescriptiononthemarket;and

(ii) the CCMhas reasonable grounds to believe that the agreementhas the object or effect of preventing, restricting or distortingcompetition.

(e) Other Vertical Agreements: Section 45 of the Act provides that avertical agreement that does not involve resale price maintenancemay be reviewedwhere the Commission has reasonable grounds tobelieve that one or more parties to the agreement is or are in amonopolysituation that is subject to reviewundersection46of theAct.

(f) Monopoly Situation: Under section 46 of the Act, a monopolysituation exists when the supply of goods or services of anydescriptionaresuppliedoracquiredonthemarketby

• oneenterprisesupply30%ormoreofthosegoodsandservicesor• 3 or fewer enterprises supply 70% or more of those goods and

services.

The Act empowers the CCM to review a monopoly situation, where theconductofanenterpriseorgroupofenterprisesislikelytoprevent,restrictordistort competition or in any other way constitute an exploitation of themonopoly situation. The CCM can impose structural and behaviouralremediesagainsttheabuseofamonopolysituation.Being in amonopoly position is not a breach in itself. It is the abuseof themonopolysituation thatconstitutes tobeabreachof theAct.TheCCMcaninterveneif:


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Questions Answers • marketsharethresholdsaremet,

• theenterprise(s)has(have)apositionofdominance,• the conductof theenterprise restricts,preventsordistorts competition

orotherwiseexploitsthemonopolysituation,• theconducthasor is likely tohave“anadverseeffectontheefficiency,

adaptability and competitiveness of the economy of Mauritius, or arelikelytobedetrimentaltotheinterestsofconsumers.

4. Willcoordinatedorevenunilateral efforts byentities to mitigate andsuppress the COVID-19pandemic promptcompetition lawscrutiny? Example:information sharing ofcompetition sensitiveinformation such asfuture prices, volumeofstock available, co-operation in delivery ofsuppliestoremoteareasifshopsarecloseddownetc.

TheAct generallyprohibits agreements, concertedpracticesordecisionsbyundertakingswhichhaveastheirobjectoreffectthepreventionorlesseningof competition in trade. Certain particularly harmful l agreements, such asagreements among competitors to fix prices, share markets, rig bids, orallocate markets, are unlawfulper se. Others are evaluated based on theireffects on competition. In terms of exemption, the Act does not apply topetroleumproductsandtheliquidpetroleumgas.

5. Can undertakingsunilaterally refuse todeal with a firm thatfails to adopt adequatemeasures to protectworkers and customers,or a firm that promotesmisinformation thatmay exacerbate thepublichealthrisks?

Asmentioned above, the Act generally prohibits decisions by undertakingswhich have as their object or effect the prevention or lessening ofcompetition in trade. Certain particularly harmful agreements, such asagreements among competitors to fix prices, share markets, rig bids, orallocate markets, are unlawfulper se. On a strict reading of the law,undertakings unilaterally refusing to deal with a firm may constitute arestrictive business practice and parties should therefore proceed withcautionpriortoimposingmeasuressuchasarefusaltodeal.

6. Would hoarding ofproducts with thesubsequent intention ofincreasing prices and/orcollusive increase ofprices in light ofincreased demand(commonly known asprice gouging) duringthe COVID-19 crisis bepermissible?

Pricefixingcanoccurwhenthereisademandorsupplyshockasaresultofanatural disaster such as an earthquake or a public health crisis such as theCovid-19pandemic.Whenentitiesactinconcertorcolludetofixprice,sharemarket or restrict supply of goods, the samemay be deemed a restrictivebusinesspracticeinviolationoftheAct.Itisalsoworthnoting,thatagreementsbetweenasupplier/distributoranditsreseller in respect of the selling price of the reseller (resale price) is alsoprohibited under the Act. A reseller/retailermust be free to independentlysetitsownpriceatwhichitwillresell/retailtoconsumers(resaleprice).


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Questions Answers In this context only non-binding price recommendations (so-called

recommended retail prices, RRP) and maximum retail prices (MRP) areadmissible.Entitiesshouldthereforebecarefultoensurethatanyincreaseinthepriceofaproductorserviceisreasonableandisnotpartofaconcertedpracticewithotherundertakingstodriveupthepriceofproduct.

7. Will the CCM holdmeetings and carry outsite visits during thisperiod?

Atthistime,theCCMisyettoissueastatementprovidingguidanceonhowthe current COVID-19 pandemic will impact the CCM’s capacity to holdmeetingsandcarryoutsearchesduringthisperiod.However,partiesshouldenvisage the possibility of the ongoing COVID-19 pandemic disrupting thenormaldaytodayfunctioningoftheCCM.

8. How does COVID-19impact investigationswheretheCCMrequiresresponses to queries tobe provided within acertainperiod?

Atthistime,theCCMisyettoissueastatementprovidingguidanceonhowthecurrentCOVID-19pandemicwill impact investigations.However,partiesshouldengagewiththeCCMonacasebycasebasisfordirectionsonhowtoproceedandalsotorequestforextensionsoftimetosubmit informationorrespondtoenquiriesbytheCCMintheeventthattheyareconstrainedfrombeing able to respond to the CCM in a timelymanner as a consequenceofCOVID-19.Suchrequestscanbemadewithwrittencommunication.


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F. GENERALQUERIES

Questions Answers1. Whatistheextentofthe

President’s powers todeclare a State ofEmergency in Mauritiusandwhatthismeans?

ThePresidentmay,byProclamation,declarethatastateofpublicemergencyexists.TheProclamation:

(a) shall,whentheNationalAssemblyissittingorwherearrangementshavebeenmadeforittomeetwithin7daysoftheProclamation,lapseunlesswithin7daystheAssemblybyresolution(i.e.majorityofallitsmembers)approvestheProclamation;

(b) shall,whentheNationalAssemblyisnotsittingandnoarrangementshavebeenmadeforittomeetwithin7days,lapseunlesswithin21daysitmeetsandapprovestheProclamationbyresolution(majorityofallitsmembers);

(c) mayberevokedatanytimebythePresidentorbyresolutionoftheNationalAssembly.

WheretheNationalAssemblyapprovestheProclamationbyresolution,theresolutionshallremaininforceforaperiodnotexceeding12months,astheAssemblymayspecifyintheresolution,andmaybeextendedforafurtherperiodnotexceeding12monthsbyresolutionoftheAssembly(again,requiringamajorityofallitsmembers).

2. Will I have to refundregistration fees forconferences that arepostponed rather thancancelled?

Thisdependsontheinterpretationofthecontract.Iftheconferenceispostponed,thecauseandobjectofthecontractarestillinexistence,itcanstillbeperformedandthereasonforpostponementcanbejustifiedasaforcemajeureevent.Arefundwouldthennotberequired.Iftheconferenceiscancelled,thenthecontractisterminatedandpaymentsmadeunderitneedtoberefunded.

3. What does thegatherings prohibitionmean for companies andshareholdermeetings?

For the duration of the prevailing curfew, initially scheduled to last untilmidnight on 02 April 2020, any gathering outside dwellings are prohibited.Shareholder and board meetings can take place by audio or videoconferencingifpermittedintheconstitutionofthecompany.

4. Can a customer wholooks sick be refusedentry?

Theoccupierofpremiseshastherighttoalloworrefuseentrytoanyperson.


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G. DATAPROTECTION

Questions Answers1. Do companies need to

consider privacy andsecurity laws whencollecting data fromemployees as part of aneffort to monitor andprevent the spread ofCOVID-19?

Many of the steps to monitor and prevent the spread of COVID-19willinvolvetheprocessingof“personaldata”(suchasadatasubject’sname)and“sensitive data” (which would include the health status of a data subject)and thereforecompanieswillneed toconsiderprivacyanddataprotectionlawsandtheirimplications.UndernewDataProtectionAct2017,”sensitivepersonaldata”arereferredtoas “special categoriesofpersonaldata”. For consistency, theexpression“sensitivepersonaldata”willbeusedthroughouttheseFAQs.InlightofCOVID-19,thefollowingshouldbetakenintoconsideration:

a)Companieshavealegalobligationtoprotect theiremployeesunderoccupational health and safety laws (duty of care) andmaintain asafeworkplace;

b)Companiescanprocesssensitivepersonaldataofanemployeewhohas a medical condition without the latter’s consent if this isnecessaryforpreventivemedicine;

c)Companiesshouldrequestemployeesand/orvisitorstoinformthemif they have visited an affected area or if they are experiencingsymptoms in order to allow the employer to take any necessarystepsintheworkplacethatarerequired;

d)Companies should not nameor disclose the identity of an affectedindividualinordertomaintainconfidentiality.However,theidentifyoftheaffectedindividualmaybedisclosedtothehealthauthorityinthe interests of the individual concerned and for contact-tracingpurposes provided that such disclosure is made in confidence andtheemployeeismadeawareofsuchdisclosure;

e)Companies should ensure that any sensitive personal data that isprocessed is adequate, relevant, limited to what is necessary inrelationtothepurposesforwhichitisprocessedandthatthedataisretainedfortheshortesttimepossible.

The InformationCommissioner (the ICO) in theUnitedKingdom confirmedthat organisations should keep staff informed about cases of COVID-19 intheirworkplaceandremindedorganisationstoavoidnamingindividuals.TheData Protection Commissioner inMauritius has not taken any position onthis. In our view, however, theData Protection Commissionerwould likelytakeasimilarapproachinthattheidentityofaffectedemployeesshouldnotbe disclosed, except where the employer is liaising with the healthauthorities and any disclosure is made in confidence and the employeeconcernedismadeawareofthedisclosure.


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Questions Answers2. Are there any local

employment or privacylaws relating to employerdisclosure (internal orexternal), on handling orstorage of the affectedemployee’smedicaldata?

Yes, the Data Protection Act 2017 contain provisions relating to employerdisclosure (internal or external) on handling or storage of the affectedemployee’smedicalinformation.


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H. LITIGATION

Questions Answers1. CanIobtaininterimreliefs

fromthecourtsduringthisperiod in light of theclosure of the courts andregistries in the event Ihaveanurgentmatter?

Matters change almost every day, and we can only guarantee thecorrectness of what is contained therein at the time when this report isbeingdrafted.Allwhat is relatedbelow is insertedwith thiscommentandqualification.Itisbettertoseekadviceatthetimewhenanyinterimreliefistobeappliedfor,toknowthelatestposition.As a general rule, we are of the view that only exceptionally urgent andreallysolidinterimorderswillbeissued,andthattheburdenofproofwillbehigher than innormal circumstances,even though this isnot stated in thelaworanywherebutonlyreflectsourimpressioninviewofthecontentsofthecircularswhicharebeingissued.Itispossibletoobtaininterimreliefsduringthesuspensionperiod,howeveronlysubjecttothefollowingprocedure:DistrictCourts

a) allapplicationsaredonethroughthePoliceProsecutororthePoliceStationwheretheApplicantresides.

IntermediateandIndustrialCourtAll applicationsmustbedone through the Secretaryof the LawSocietyortheSecretaryof theBarCouncil,whowill sendtheapplicationbyemail totherelevantCourt.SupremeCourt(JudgeinChambers)

a) FamilyCourtTheApplicationismadethroughthePresidingJudge’ssecretaryortheCourtManager.Phonenumbershavebeengiven.The two saidpersonsmustbecontactedbyphoneand theywill thenadvise as tohow toproceed, afterliaisingwiththerelevantJudge.TheCourtRegistry isclosed,andnoe-mailaddresshasbeengivenforthesendingofanyapplication.b) CommercialDivisionTheefilingremainsaccessibleasusualc) OtherdivisionsTheApplicationismadethroughthesecretaryoftheSeniorPuisneJudgeortheActingMasterandRegistraroftheActingDeputyMasterandRegistrar.


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Questions Answers Onceagain,theCourt isclosed,andonlyphonenumbershavebeengiven.

Noruleshavebeenissuedastowhetherdocumentscanbesentviae-mailornot,andasmostAttorneysworkfromhomewithoutscannerorprinter,whetherunsignedapplicationswillbeentertainedornot.Nopartywillappearbeforethesaid judgeormagistrateforthehearingoftheapplication.

2. Will you be able to file orservedocuments/pleadingsfollowing the closure ofcourts,registriesandmostoffices?

Thecourtbuildingswillnotbeaccessibletomembersofthepublicastheyshallbeclosed.Accordingly,allcourtregistrieswillbeclosed.However,pleasenotethatonlypartieswithurgentmatterswillbeallowedtofiletheirmattersasdescribedabove.WithregardtocasesbeforethecommercialdivisionoftheSupremeCourt,Attorneys can file theirpleadingselectronically through thee-filing systemAspertheSupremeCourt,ElectronicFilingRules,applicationsfiledthroughthee-filingsystemhavetobesigned.Thereisagenerallockdownandgoingto the office is prohibited. It is not knownwhether unsigned applicationsfiledfromhomewillbeadmittedornot.TheCourthas issuedacirculartotheeffectthatallmilestonesforthefilingofdocumentsaspertheRulesarewaived.It may not be possible to physically serve any documents. However, onecould agree with their counterparts to accept electronic service ofdocumentsorpleadings.ServiceofinitialproceedingsonDefendantsisverydifficultifnotimpossibleasthiscannotbedoneviae-mailandweinalmostallthecasesdonothavethee-mailaddressesoftheopponents,ifevertheopponentsarereadyandwillingtoaccepte-mailservice.

If not, will I be penalisedforfailingtodoso?

TheCourtswillbelenientconcerningdeadlinesandinthecaseofe-filingcases,thereisanofficialcircularfromtheCourttotheeffectthatallmilestonesanddeadlinesarewaived.

3. CanIexecuteacourtorderduring this period ofsuspension of courtactivities?

Allexecutionproceedingsaresuspended.TheUshers,whoexecuteCourtOrders,arenotallowed(likeallcitizens)togooutunlesstheyhaveapermit,andsuchpermitsarenoteasilyobtainableandseveralapplicationshavenotbeenentertained.

4. How will new dates beobtained for the mattersthat were to be heard ormentioned during thesuspensionperiod?

Newdateswillbeissuedbycircularoncejudiciaryoperationsnormalise.

5. Whatwillhappentointerimordersthatweresettolapseduringthesuspensionperiod?

ThisperiodwillbeextendedsubjecttofurtherguidancebytheChiefJusticeofMauritius.


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Questions Answers

6. WhatisthestatusofoperationsattheCourtofAppealandtheMagistratesCourtduringthisperiod?

All hearings andmentions in both civil and criminal cases have also beensuspendedattheCourtofAppeal.Furtherguidelinesmaybe issuedwithregardtooperationsattheCourtofAppeal.

7. Can a witness be excusedfrom attending court iftheirdatefallsoutsidetheperiod when courtactivities have beensuspendedbutthewitnessisreluctanttotravelowingtoCOVID-19?

It will be subject to the discretion of the Court but if there is no officiallockdownorcurfew,ourviewisthatthewitnesswillhavetoattendCourt.

8. Will Ibeabletoobtainanearly date for my matter,in light of the backlog ofcases thatwillariseowingtomattersthatweretakenout during the suspensionperiodbeingprioritised?

Allocationof courtdateswill dependon thedirectives issuedby theChiefJustice or the directions given by the PresidingMagistrates of each lowerCourtafterthesuspensionperiod.


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I. BANKINGANDFINANCE

Questions Answers1. Are there any statutory

protections available to aborrower in the face of apandemic?

Currentlytherearenoneunderourlaws.Forthesereasons,theGovernmentofMauritius announced a series ofmeasures on the 13 and the 23March2020 in support of enterprises and individuals in view of the impact ofCOVID-19 on business, including moratorium on capital repayments ofhousing loans, the restructuring of loans and the provision of extension ofperiodsofrepaymentofloans(seesection8below).In addition, a lender may be requested to agree to defer payment of theprincipal/intereston loansbut the lender isnotobligedtodososubject tothesupportmeasuresmentionedabove.

2. What are the permissibledefault charges includinginterest in the event thatthe lender declares adefault?

ThiswillbeinaccordancewiththeprovisionsoftherelevantloanagreementandsubjecttothemoratoriummeasuresannouncedbytheGovernmentofMauritius to support businesses and individuals during this period (seesection8below).

3. How do the currentcircumstancessurrounding COVID-19affect perfection of thefollowingformalities?Stamping and registrationofsecurities;

UnderMauritian law,only fixedand floating chargeshave tobe registeredand inscribed with the Registrar General/Conservator of Mortgages forperfection purposes. Since the lockdown, the office of the RegistrarGeneral/ConservatorofMortgagesisnotoperating.Documents can still be lodged for registration on the online registrationplatformbutarenotbeingprocessed(taxedandinscribedinpublicregisters)bytheRegistrarGeneral/ConservatorofMortgages.

4. DoestheimpactofCOVID-19affecttheenforcementofsecurities?

TheCOVID-19pandemichasadirectbearingonenforcementofsecurities.Inthe event that COVID-19 does not constitute a force majeure event oranother excuse event under the financing arrangement and the borrowerdefaults under the terms of the agreement, the lender can proceed toenforcementasprovidedintherelevantsecuritydocument.On the22March theofficeof theChief Justice announced that the courtswill remain closed, but a minimum staff will still be operating for urgentapplications. Lenders may be forced to resort to other enforcementmechanisms permitted by law that do not involve courts, governmentagencies and offices or auctioneers such as private sales or any othermechanismsetout in the financedocument thatdoesnot involve the landregistries,thecourtsoranyofthegovernmentagencies.The above remain subject to the support measures announced by theGovernment,seesection8below.


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Questions Answers5. CanCOVID-19constitutea

forcemajeureeventunderaloanagreement?

Itdependsonhow the loanagreement isdraftedandwhat is includedaswithin the categoriesof “forcemajeure”. If the contract is silent, theCivilCode(articles1147and1148)recognisestheconceptofforcemajeureasadefense,whichexcusesacontractingpartyfromperformingitsobligations.Force majeure then prevents the party who has been prevented frompreformingfrombeingliabletotheothercontractingparties.ForaneventtoamounttoforcemajeureundertheCivilCode,itmustbeunforeseeableandirresistible.A“forcemajeure”onlyexoneratesthecontractingpartyfromperformanceduring the period for which the “force majeure” event lasts, once thisperiodisoveroritseffectsareover,thecontractshouldbeperformed.Iftheeffectsofthe“forcemajeure”eventaresuchastohaverenderedtheperformanceofacontractnugatory,anyoneofthecontractingpartiescanapplytocourtfortheterminationofthecontractunderarticle1184oftheCivilCode.Thisrecoursemaybenotbeapplicabletomonetaryobligationsunderaloanagreement.

6. CanCOVID-19constituteamaterial adverse effect(MAE) under a loanagreement?

In some instances, it couldbe–but it isdifficult to saywithanycertaintyand may require court intervention. The precise phrasing of the MAEprovisionandthespecificcircumstancesisimportant.When invoking a MAE clause, materiality will need to be demonstratedclearlyandobjectively.Given thatMAEclauses tend to lack language thatidentify a particular event or loss as aMAE, determination of a claim forMAE relief often requires a detailed factual inquiry with an uncertainoutcome. Invoking aMAE clause due to COVID-19 issuesmay be difficultgiven that the long-termeffects of COVID-19 on financial and operationalaspects are unknown but much turns on the actual language of theprovision.


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Questions Answers7. Isoldoneofmyproperties

and I wanted to use thepurchase price to settle abank loan I had taken. Inthe event the land registryis shut down, meaningregistration cannot occur,will interest continue toaccrueonmyloan?

Yes, subject however to the moratorium proposed by the Ministry ofFinance on certain type of loan (see section 8 below) and to a possiblerequestthebankforadeferralofanypaymentsthatwouldbedueduringtheperiodofclosureoftheregistry.

8. Is it possible to havegovernmental/regulatoryintervention in privatecommercial transactions?For example, can thegovernment requirelenders to take certainactionorinactioninlightofthepandemic?

The Government of Mauritius and the Central Bank of Mauritius, inconsultation with commercial banks through the Mauritius BankersAssociation and other stakeholders of the key economic sectors,announcedacoupleofmeasurestosupportbusinessesandemploymentduringthisperiod.Belowaresomeofthekeymeasuresannouncedinfavourofbusinessesasatthe20March2020:- Reduction of the Key Repo Rate from 3.35% to 2.85% to support

domesticactivity.- SpecialReliefamountofMUR5billiontoassistbusinesseswhosecash

flow andworking capital have been adversely affected by COVID-19.TheSpecialReliefamountwillbeavailablethroughcommercialbanks.Loansunderthismeasurewillbeprovidedbetween23Marchuntil31July2020 fora termof2yearswithan interest ratecapat2.5%perannum and will be subject to a moratorium of 6 months for thepaymentofcapitalandinterest.

- Amoratoriumof6monthsoncapitalrepaymentswillalsobeappliedtoexisting loanstobusinesses,whichhavebeen impactedbyCOVID-19.Thesemeasureswillbeaccompaniedbyareductionfrom9%to8%intheCashReserveRatioapplicabletocommercialbanks.

- Temporary suspension of the application of the Bank of MauritiusGuideline on Credit Impairment Measurement and IncomeRecognition with immediate effect. The suspension is intended toallow commercial banks to support businesses having cash flow andworkingcapitaldifficulties.

- Introduction of a 2020 Savings Bond to be issued by the Bank ofMauritiusasfrom23March2020.ThesavingsbondwillbeissuedforatotalamountofMUR5billionwithacouponof2.5%andmaturityof2years. Subscription will be open to individuals who are resident ofMauritius and locally registerednon-profitNGOs, andwill be subjecttoacapperinvestor.

- Enterprise Modernisation Scheme (EMS) by DBM Ltd Interest rateunderEMSwillbereducedfrom3.5%to2.5%.


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Questions Answers - The interest rate under SME Factoring Scheme will be reduced from

3.9%to2.5%.- CorporateGuaranteeISPLtdwillissuecorporateguaranteetobanksto

enablethemtograntloanstocompaniesaffectedbyCOVID-19.- TheSMEEquityFundLtdwill reduce itsminimumreturnrequirement

onequityfinancingfrom6%to3%.- DBMRevolvingCredit FundARevolvingCredit FundofRs200million

will be established at theDevelopmentBankofMauritius Ltd tohelpcompanies with turnover of up to Rs 10 million to ease cash flowdifficultiesupto31stDecember2020.Underthisscheme,thecredittocompanieswill be free of interest, provided that it is repaidwithin 9months

- Double Tax Deduction on Investment Enterprises being affected byCOVID-19willbeentitledtoadoubletaxdeductionontheirinvestmentin Plant andMachinery for the period 1 stMarch 2020 to 30th June2020.

- HouseholdsaffectedbyCovid-19mayrequest theircommercialbanksfora6-monthmoratoriumoncapitalrepayments.

- The Bank of Mauritius will bear interest repayments of outstandinghouseholdloansfrom01Aprilto30June2020,forhouseholdsearninguptoRs50,000amonth.

Additional support measures have also been taken per sectors such astourism,manufacturingandtrade,agro-industryandhealth.

8. What are the

consequences of declaringa force majeure eventunder a financetransaction?

If a “forcemajeure” clausewas provided under the loan agreement, theconsequences will depend on what was expressly provided for in thecontract. Contractual remedies for force majeure typically include anextensionoftimetoperformthoseobligationsorsuspensionofcontractualperformance for the duration of the force majeure event. If the forcemajeure event extends over a longer period (the period is typicallyspecified), such clauses usually permit either party to terminate theagreement. Termination will result in the commitments made under theagreementbeingcancelledandallamountsbecomingimmediatelydueandpayable.If “force majeure” events were not provided under the loan agreementpleaserefertocommentsundersection5above.


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Questions Answers9. In the event of a force

majeure event, whatwould be the pertinentclauses that would needtobereviewedintheloanagreement?a) Financialcovenants;b) EODs;c) Materialadverse

effect;andd) Notices(remedy

periods,triggers?)

(a) Financial-covenantsIf aborroweranticipatesbreachesof their financial covenants, theymayhavecontractualrightstocurebypre-emptiveequityinjectionsorbeableto raise subordinated group debt to apply in partial prepayment. Inaddition, borrowers and lenders will need to scrutinise certain financialcovenantrelateddefinitionstodetermineifanyavailableadd-backscouldbeutilisedtolimitthecovenantimpactresultingfromdecreasedrevenue.(b)EOD’sSome finance documents allow financial covenant breaches to be curedwhich borrowersmaywish to consider. In addition, agreementsmay bereachedthatwaivebreachesforashortperiodoftime.Borrowerscanalsoattempt to negotiate for applicable remedy periods for such events ofdefault.(c) Materialadverseeffect(MAE)It is not possible to say at this stage how long the coronavirus and itsconsequenceswilllast.Therefore,claiminganeventofdefaultbyvirtueofabreachofaMAEclausewillrequirecarefulconsiderationoftheprecisewordingoftheclauseandthesurroundingcircumstances.(d) Notices(remedyperiods,triggers?)Borrowersshould reviewtheir loandocumentationand,whereeventsofdefault have been triggered or are likely to be triggered, they shouldapproach their lenders to renegotiate or restructure their loans.Lenders should, however, be cognizant of the support measuresannounced by the Government of Mauritius to mitigate against theeconomiceffectsoftheCOVID19outbreak(seesection8above).

10. Isitpossibletohavegovernmental/regulatoryinterventioninprivatecommercialtransactions?Forexample,canthegovernmentrequirelenderstotakecertainactionorinactioninlightofthepandemic?

Seesection8above


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Questions Answers11. Can a borrower request a

moratorium onrepayments?

There isnostatutoryrighttoadebtmoratoriuminMauritiusoutsideofaninsolvencysituation.However as mentioned under section 8 above, the Government ofMauritius introduced supportmeasures amongst whichmoratorium onrepaymentsof loans.Borrowersshouldproactivelyenter innegotiationswithlendersinordertoforestallpotentialloandefaultsasthiswouldbeinthebestinterestofallpartiesinvolved.

12. Does a lender have anobligation toaccommodate aborrower’s requests in theface of a pandemic andwhat would be the legalconsequencesofarefusal?

Unless otherwise provided in the relevant loan agreement between aborrowerandlenderandsubjecttothesupportmeasuresputintoplaceby theGovernmentofMauritius (see section8above), lendershavenolegalobligationtoaccommodateaborrower’srequestforamoratoriumondebtrepayments.

13. Can theMauritius BankersAssociation engage onpossible exemption fromcertain reportingrequirements?

Please refer to Section 8 above on the support measures taken at theleveloftheGovernmentandtheCentralBankofMauritiusinsupportofthe banking activity after consultation with the Mauritius BankersAssociation.


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J. TAX

Questions Answers1. Value Added Tax (VAT)

return – My first VATreturn for 2020 is due on20th April. What should Ido?

AVATregisteredpersonhastosubmitmonthlyorquarterlyVATreturnstotheMauritiusRevenueAuthority(MRA)asmaybeapplicable.Thequartersendon31March,30June,30Septemberand31December.Areturnhastobesubmittedwithin20daysfromtheendofthemonthorquartertowhichitrelates.ThereforetheduedateforsubmissionofreturnformonthofMarchorthequarterended31Marchis20April.The facilities for the electronic submission of VAT returns and electronicpayment of any VAT due are available on MRA website (www.mra.mu)duringthelockdownperiod.However, companies who are unable to submit VAT returns or effectpayment of tax due to the COVID-19 Pandemic lockdown will not bechargedanypenaltyorinterestforlatesubmission/payment.

2. Mycorporatetaxreturnisdue soon. What should Ido?

Annual self-assessment corporate tax returns should be filed and the taxpaidwith theMRA not later than 2 days (excluding Saturdays and publicholidays)beforetheendoftheaccountingperiod.Companieswhichhavea30Septemberyearendandthedeadlineforfilingtheir tax returns is therefore the 28th day of March of every year. Thefacilitiesfortheelectronicsubmissionoftaxreturnsandelectronicpaymentof any tax due are available on MRA website (www.mra.mu) during thelockdownperiod.Shoulditbeapparentthatyouwillnotbeinapositiontofileyourtaxreturnsbytheduedate,duetothecurfeworlockdown,youwill notbepenalised for anydelay. Companieswhoareunable to submitreturnsoreffectpaymentoftaxduetotheCOVID-19Pandemic lockdownwillnotbechargedanypenaltyorinterestforlatesubmission/payment.

3. Remittance of PAYEwithheld

EmployersarerequiredtosubmitamonthlyPAYEreturnelectronicallyandincludethereinthedetailsofallemployees.AtthesametimepaytoMRAtheamountofPAYEwithheld.The due datewhere both themonthly PAYE return and the payment aremadeelectronically is theendof themonth following that inwhichPAYEwaswithheld.Inanyothercasetheduedateis20daysaftertheendofthemonthinwhichPAYEwaswithheld.Thus,forthemonthofMarch,theduedateforsubmissionofPAYEreturnandpaymentis20April.The facilities for the electronic submission of tax returns and electronicpayment of any tax due are available on MRA website (www.mra.mu)duringthelockdownperiod.However, companies who are unable to submit PAYE returns or effectpayment of tax due to the COVID-19 Pandemic lockdown will not bechargedanypenaltyorinterestforlatesubmission/payment.


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Questions Answers4. Due to absence of key

staff in our accountingdepartment, we have justrealised that we missedthe deadline for filing anobjection to a taxassessment– what shouldwedo?

An application, in a form approved by the Director-General of the MRA,may be made within 28 days of the tax assessment being issued, by aperson dissatisfied with the assessment issued to him. The formmay besentbyregisteredpostorsubmittedelectronically.Incasetheobjectionis lodgedoutsidethedelayof28days,theMRAistoconsidertheobjectionasvalidonconditionthatthetaxpayerprovestothesatisfaction of theMRA that hewas unable to object in time because ofillness or other reasonable cause (in this case, the COVID-19 Pandemiclockdown).Wearetheviewthatthecurrentsituationwillbeconsideredasareasonablecause.

5. Ihaveanon-goingcaseatthe Assessment ReviewCommittee which is duefor hearing or mention.Whatwillhappen?

The Committee has suspended sittings during this period until furthernotice.

6. What happens withAlternative Tax DisputeResolution (ATDR)meetingswiththeMRA?

AsweareinacurfewallATDRpanelhavebeenpostponed.TheATDRPanelwillrevertbacktothetaxpayerwithnewdates.

7. AppealtotheSupremeCourt

AnypartywhoisdissatisfiedwiththedecisionoftheARConapointoflawmaylodgeanappealwiththeSupremeCourt.Theaggrievedpartyshould,within 21 days of the date of the decision of the ARC, lodge a writtenapplicationrequiringtheARCtostateandsignacasefortheopinionoftheSupremeCourtonthegroundsspecifiedinthecase.Following communique from the Chief Justice of the Supreme Courtwitheffectfrom23March,theSupremeCourthassuspendedsittingsduringthisperioduntil furthernotice,exceptonurgentapplications. Intheeventtheappeal cannot be lodged within the time frame, it will in our view beconsideredasanexcusabledelay.

8. HowwilljudgementsbedeliveredbytheARCduringthisperiod?

There isnoset time frameunderMauritius law todelivera judgement. Itcanbedoneelectronicallyaswell.


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K. CYBERSECURITY

Questions Answers1. During the COVID-19

pandemic, is there anincreased cyber securityrisk?Why?

The effects of the COVID-19 continue to be felt across the world as thepandemic disrupts the health, economic, political and social systems. Thesocial isolationpolicyhascompelledorganizationstohavetheiremployeesworkfromhomeasabusinesscontinuitymeasure.Theshift inworkingenvironmenthasan impacton informationsecurityasdigital tools (e.g., internetconnection)available tostaffas theywork fromhomemaynotbeas robustas thoseat theworkplace. There is thereforethe underlying risk of cyber-attacks as cyber criminals could exploit thesituationtoaccesstheemployee’scomputerresources.

2. Whatissocialengineering?

AccordingtoNortonSecurity1,‘socialengineering’istheactofmanipulatinga person into giving out sensitive information, rather than by outrightstealingtheinformation.

3. Whatisphishing? Phishingisaformofsocialengineering.Itreliesonthecomputeruser’sownvulnerabilities,namelyignorance.The current anxiety about COVID-19 has triggered a lot of emails from“expertsorstateagencies”containinglinkstoinformationonthepandemic.While some of these emails are genuine, cyber actors are exploiting thesituationby:a) launchingphishingattacksusingattachmentsthathavedataonCOVID-

19;andb) sendingemailsfromfake“Governmentinstitutionsorcompanies”.On 20 March 2020, the Mauritius Computer Emergency Response Teamissued a Communique advising people not to click on links on unsolicitedemailsandtobebewareofattachmentsrelatingtoCOVID-19.2Likeforanycyber incident, a personmay report a COVID-19 related cyber incident onthefollowingwebsite:http://www.maucors.govmu.orgBecause more people will be working from home or remotely, cybercriminalswillcontinuetolookforwaystoexploitthis.Therefore,employeesneedtobesensitisedaboutthis.

1https://www.nortonsecurityonline.com/security-center/phishing.html2Formoreinformationseehttp://cert-mu.govmu.org/English/Documents/Security%20Alerts/2020/March/Communique%20COVID-19.pdf


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Questions Answers

4. What prescriptivemeasures should yourorganization consider indealingwithphishing?

Youshouldconsiderthefollowing:a) Doesyourorganisationhave inplace remindersonphishing including

whataphishingemaillookslike?b) Howoftenareemployeesremindedofsuchattacks?c) Have employees been cautioned against clicking on links or opening

emailsfromsuspicioussources?Howoftenaretheycautioned?d) Doesyouranti-virusscanidentifysuspiciouslinks?e) Howarelinksembeddedinemailsmonitored?f) Does thebusinesshaveacyber security incident responseplananda

businesscontinuityplan?

5. What do insider threatsentail?

Inside threats are maliciousthreatsoriginating from people within anorganizationwhohaveknowledgeoftheorganization'ssystems,dataandsecurity procedures. Insider threats are also a reality for organizationsduringthishealthcrisis.At the place ofwork, a security check is in placewhen employees leavetheirplaceofwork,securityofficersareunlikelytogothroughbagsforfearof getting infected, and this provides amajor opportunity to exploit themeasures.

6. What prescriptivemeasures should yourorganization consider indealing with insiderthreats?

Theorganisationshouldconsiderthefollowing:a) What security measures do you have in place to safeguard against

insider threats: do you have host-based firewalls, security eventmanagementtools,etc.?

b) Has your organisation carried out an internal/external vulnerabilityassessment in the last 12months to check for loopholes that can beexploitedbymaliciouscyberactors?

c) Hasyourorganizationconductedageneral ITauditwithin the last12months?

d) Areemployeesallowedtoconnectexternaldevicesontheemployer’snetwork?

Inaddition,employersandemployeesalikeareencouragedtoconsiderthefollowing factorswhich ensure remote cyber-security. These factors havebeen published by the Mauritius Computer Response Team and are asfollows:


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Questions Answers

(i) Keep close contact with your employer - It is important to know newpolicies relating toCOVID-19 tohelpkeepyou,your co-workers,and thebusinesssafe.

(ii) Usethecompany’stechtoolbox–youremployer’stechtoolsaredesignedtoprotectdataanddevices; they cankeepyou ‘cybesafe’whenworkingremotely.

(iii) Controltheimpulsetoimprovise–Ifadigitaltool(e.g.,asoftwarewhichallows for teamwork) is not working, refrain from downloading asubstitute. You could inadvertently introduce a software with a securityflaw.

(iv) Stay up-to-date on software updates and patches - Updates help patchsecurityflawsandhelpprotectyourdata.

(v) IfyouhaveVirtualPrivateNetwork(VPN),keepiton-AVPNcanprovideasecure link between employees and businesses by encrypting data andscanningdevicesformalicioussoftwaresuchasvirusesandransomware

(vi) Beware of COVID-19-themed phishing emails – Cybercriminals areexploiting the COVID-19 virus outbreak to send out fake emails withdangerouslinkstoemails.

(vii) Develop a new routine - Working from home means new routine andmakingsurethatyouarecybersecureispartofthat.