Mauritius is a well regulated International Financial Centre and all Trust Companies and Corporate Service Providers are licensed and regulated by the Mauritius Financial Services Commission. Offshore Banks are licensed and regulated by the Bank of Mauritius and most offshore banks are reputable international banks also operating in other major offshore jurisdictions.
There are two types of global business companies that may be set up in Mauritius, Category 1 Global Business Company (GBC1) and Category 2 Global Business Company (GBC2). Both type of companies are set up under the Companies Act 2001 and licensed under the Financial Services Act 2007. A GBC1 can engage in any financial business activities such as assets management, credit finance, custodian services (non CIS), distribution of financial products, factoring, leasing, occupational pension scheme, pension fund administrators, pension scheme management, retirement benefits scheme, superannuation funds, registrar and transfer agent, treasury management and such other financial business activity as may be specified in Financial Services Commission (FSC) Rules.
Evolution of Global Business Entities
Source: Financial Services Commission (FSC) |
Incentives for Global Businesses
Mauritian entities carrying on global business enjoy a large number of fiscal and other incentives; the more important ones are summarized below.
- Global Business Category 1 companies are liable to pay tax at 15% on net operating income with credit for actual foreign tax paid or if lower deemed tax paid on foreign source income, which reduces the effective tax rate to a maximum of 3%.
- Trusts are at par with other corporations and thus benefit from the Mauritian double tax treaty network.
- Trusts may elect for tax exemption.
- Global Business Category 2 companies are tax exempt.
- There are no other "hidden costs" such as stamp duties or levies.
- No withholding taxes are levied on dividends, interests and royalties.
- Capital gains on disposal of securities and other movable property are exempted from taxation.
- Inheritance of shares is not subject to estate duty or cumbersome formalities.
- Expatriate employees pay income tax at a maximum of 15%.
- Global business companies can secure occupation and residence permits for employees earning USD1000 monthly.
- No exchange control.
Global Business Companies
Who may conduct Global Business?
Any resident corporation which proposes to conduct business outside Mauritius may apply to the FSC for a GBC1 or GBC2.
What is a 'resident corporation'?
- A body corporate formed or registered under the Companies Act 2001
- A trust, societe or partnership or any body of persons governed by the laws of Mauritius
The FSC will continue with the practice of not issuing a GBC2 licence of which the beneficial owner is a person resident in Mauritius.
Activities that may be conducted by a GBC2
The FSA restricts certain business activities that may be conducted by a GBC2. The following activities will not be approved for a GBC2:
- Banking
- Financial services
- Holding or managing or otherwise dealing with a collective investment fund
- Providing registered office facilities, nominee services etc
- Providing trusteeship services
Conduct of business by a GBC1
The FSA requires a GBC1 to be administered at all times by a Management Company. In doing so, the FSC may consider whether the GBC1:
- Has at least 2 resident directors of sufficient caliber
- Maintain at all times its principal bank account in Mauritius
- Maintain at all times, its accounting records at its registered office in Mauritius
- Prepare its statutory financial statements and to have them audited in Mauritius
- Provides for meetings of directors to include at least 2 directors from Mauritius
Geographical breakdown of investments through GBC1 (2006/2007)
Source: Financial Services Commission (FSC) |
Funds
As at 30 June 2007, 439 global funds were registered with the FSC and their Net Value of Assets (NAV) stood at over US$43 billion
Evolution of NAV of global funds
Source: Financial Services Commission (FSC) |
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