The Seychelles East Africa Submarine (SEAS) cable project consisted in the establishment of the first submarine fibre optic cable for international connections of the Seychelles archipelago to the African Continent. The promoter, the Seychelles Cable Systems Company Limited (SCS) is a private-public partnership undertaking made up of Airtel, Cable and Wireless Seychelles (CWS) and the Seychelles Government. The overall cost of the project was estimated at EUR 27.2m and has been financed through 40% equity and 60% long-term debt by EIB and AfDB. The cable arrived at Beau Vallon on 27 May 2012 and a ceremony took place the same day, marked by the presence of the President of the Republic of Seychelles.
The ITF grant was used by the Government of the Seychelles (GoS) to acquire an equity stake in the new company created to operate the cable, the Seychelles Cable Systems Company Limited (SCSCL). The purchase of the equity stake was made on 23 September 2011 for the USD equivalent of EUR 3.9m. The income received by the GoS from this equity stake will be used to provide free internet access to schools, hospitals and other social services. SCSCL has not yet distributed any dividends, because for accounting purposes, the revenues from leases of STM1 lines are spread over the whole period of the lease and thus the company is still recording accounting losses despite large upfront cash payment by clients. However, the private shareholders of SCSCL have agreed to provide fixed annual payments to the GoS for the purpose of providing free internet access to target groups, if the GoS allows carry forward of tax losses beyond the current 5 year limit. The GoS has approved the change in the tax code and respective regulation for application of the new tax rules as been published in 2016. The GoS has now approved the change in the tax code and regulation to apply the new tax rules. The signature of the Transfer Agreement (related to the annual payments from SCSCL to the GoS) is still pending.
Letter from Mr. James MICHEL, President of the Republic of Seychelles to H.E. Baroness Catherine ASHTON, High Representative of the European Union for Foreign Affairs, Vice President of the European Commission, in which mention is made to the Seychelles East Africa Submarine Cable Project.