MAURITIUS
A JURISDICTION OF GROWING IMPORTANCE
Mauritius is the key to the gates of Asia and Africa. Since its inception, as an International Financial Centre
in the early 1990s, it has evolved into a modern jurisdiction which enjoys political and economic stability
with a sophisticated infrastructure to encourage business.
WHY MAURITIUS? Many factors need to be taken into consideration when setting up a fund and
selecting a jurisdiction. However, as a result of its geographic location close to Africa, time zone and
carefully crafted legislation, Mauritius has become a desirable location from which to do international
business. Mauritius has a modern legislative regime for establishing funds, corporate companies, limited
partnerships, trusts and foundations. Consequently, it is a jurisdiction commonly used for investment
structuring into Asia and Africa recognised by both fund managers and investors.
All the infrastructure ingredients are in place in Mauritius, with a sophisticated telecommunications
structure as well as a pool of bilingual, qualified, high calibre accountants, lawyers, fund administrators and
corporate secretaries. The Stock Exchange of Mauritius Ltd (SEM) is committed to positioning Mauritius
as an attractive location for the listing of investment funds. The investment funds listing regime has been
tailored to provide a streamlined listing process for a wide variety of fund structures. Based on recent trends,
we could see Mauritius being used for global funds rather than predominantly African or Asian focused
funds: a signal that fund managers realise the potential for Mauritian domiciled funds being internationally
recognised amongst High Net Worth and Institutional investors.
Mauritius has a network of double taxation avoidance agreements (“DTAA”) with many countries in the
Asian and African continents which include India, Malaysia, Singapore, China, Thailand, Botswana,
Lesotho, Madagascar, Mozambique, Namibia, Rwanda, Senegal, Seychelles, Republic of South Africa,
Swaziland, Tunisia, Uganda, Zambia and Zimbabwe. A few more are still in the process of being ratified:
Nigeria, Kenya, Russia and Congo. A further four treaties also await signature with Egypt, Ghana, Gabon,
Malawi and Monaco. Furthermore, Mauritius has also signed a number of IPPA’s (Investment Protection
and Promotion Agreements) with a number of African countries. They give protection to investments
against expropriation or confiscation by governments, as well as encourage promotion between member
states. Middle Eastern countries can also use Mauritius as a platform given that Mauritius is in the same
time zone and has a network of double taxation treaties with the following Middle Eastern countries: Oman,
Qatar, United Arab Emirates and Kuwait.
The Mauritius and India DTAA has been a source of significant growth for Mauritian Indian domiciled
funds. The significant tax advantages have served as a catalyst for the development of the financial
services industry in Mauritius as well as seeing an increase in Foreign Direct Investment into India. It is
expected that the tax advantages will remain with investments into India occurring through a Mauritian
domiciled vehicle. Moreover, Mauritius is the gateway for structuring investments into Africa. Mauritius is
the only International Financial Centre that is a member of all the major African regional organisations
(SADC, COMESA and African Union). It also has a leading position in the African continent according
to many indicators and indices. (1st out of 53 countries in Africa on the Mo Ibrahim Index for Corporate
Governance, the Fraser Institute’s Economic Freedom Index and again in the World Bank’s Ease of
Doing Business In Africa Index, for the 4 th year running). Mauritius is also being used by India for outward
investments into Africa and Financial Institutions such as IFC, OPIC and ADB favour Mauritius as their
natural domicile for investment into Africa. African Private Equity Fund Managers are using Mauritius to
benefit from the DTAAs and as well as for their investment’s protection.
Mauritius is also a relatively low cost jurisdiction for doing business, particularly when weighed against
the cost of doing business in other jurisdictions.
MAURITIUS
A JURISDICTION OF GROWING IMPORTANCE
Mauritius has also become known as a reputable country with regard to arbitration. Foreign operators have
seen that the government and the judiciary favour arbitration to accelerate development. Mauritius is at
the crossroads of Anglo-Saxon Law (Common Law) and Napoleonic Law (Civil Law).
MAURITIUS DOMICILED FUNDS
In Mauritius, an investment fund can be constituted under the Companies Act 2001, the Securities Act 2005
and the Securities (Collective Investment Schemes and Closed-end Funds) Regulations 2008.
An investment fund can be established as an expert fund, a professional collective investment scheme,
a specialised collective investment scheme, or a closed-end fund. There are no specific rules applying
to hedge funds in Mauritius, as the terminology “hedge fund” is currently not used. As Hedge funds are usually
offered to professional investors or high net worth individuals, they can apply to be categorized as
“professional CIS” or “expert funds”. Based on the 2013 budget speech, the government is looking to create
a regime for Non-Treaty based funds that will enjoy tax free status.
An investment fund must hold a Global Business Category1 license and meet all the required licensing
conditions to then avail of the double taxation treaty network.
THE MAURITIUS LIMITED PARTNERSHIP
In December 2011, the Mauritius Limited Liability Partnerships Act 2011 was ratified. The use of limited
partnerships will be significant to the funds industry in Mauritius as they are the vehicle of choice for fund
structures in many foreign jurisdictions. Limited partnerships are more flexible than companies, and are
therefore significantly more attractive to investment vehicles such as hedge funds, private equity funds and
joint ventures. Instead of forming a Cayman or Luxembourg limited partnership as a pooling vehicle to
feed into a Mauritius Investment Fund which in turn invests into in an Asian or African Country, it is now
preferable to form a limited partnership in Mauritius. Indeed, those currently operating such structures may
wish to consider re-domiciling their limited partnerships to Mauritius.
With increased regulation and higher standards of best practices, Mauritius has demonstrated that it has
the capability and capacity to adapt to changes and will be up to the challenges to meet a changing
global financial services environment.
FUND SERVICES
Mauritius has a strong network of professional service providers. In 2011, Equinoxe opened its Mauritius
office to bring institutional quality service levels and technology into this developing market. As Mauritius
continues to develop its legal offering, the depth of service providers continues to grow, with Equinoxe
being among the leaders in technology innovation and enhanced service offerings. The solutions being
offered to Mauritian domiciled funds by Equinoxe are the same as those in all other locations, including the
Cayman Islands, Bermuda, Ireland, United States, and the British Virgin Islands.
Equinoxe Alternative Investment Services (Mauritius) Limited
12th Floor, Raffles Tower, 19 Cybercity, Ebene, Mauritius
P: (230) 468 1291 F: (230) 468 1219 W: www.equinoxeais.com