Global Funds

The reputation of Mauritius as an International Financial Centre and as a domicile of choice for setting up Global Investment Funds investing into Africa and Asia is well established among Fund Managers and institutional investors.

In Mauritius, Global Investment Funds can be set up as companies, limited partnerships, protected cell companies (PCC) or trusts and will require the authorisation of the Mauritius Financial Services Commission (FSC) to operate as either an open-ended fund (collective Investment Scheme) or a closed ended fund.

The process to set up a Global Investment Funds in Mauritius is to file an application for a GBL and authorisation to operate as a fund (open-ended or closed-ended) with the FSC.

The following documents need to be submitted:

• A duly completed application form for registration/incorporation and licence.
• Fund documents including.
  1. A company, a constitution and the shareholders’ agreement (if adopted);
  2. A limited partnership, a limited partnership agreement and an investment management agreement.
  3. A trust, the trust deed, the subscription agreement and any advisory agreement.

• A draft offering memorandum or prospectus.
• A consent form for initial shareholders and directors or partners
• Know-your-customer documentation on promoters, beneficial owners and proposed directors, general partners or trustees (as applicable).
• Certificates and confirmations required by law and the FSC.
• Appropriate government/licensing fees.

The timeframe for the application of a fund authorisation is around 60 business days from the time the application is submitted.

Investment Manager

An investment fund is required to be managed by an investment manager licensed as a collective investment scheme manager by the FSC or by a foreign investment manager with the approval of the FSC.

A fund that is constituted as a company may be self-managed (ie, managed by its board of directors), with the approval of the FSC.

Taxation of Funds

The tax status will depend on the legal form of the Investment Funds.

Companies

Where an investment fund takes the form of a company, it would be liable to tax on its chargeable income at the rate of 15%. An investment fund may however be entitled to benefit from a partial exemption of 80% on all its income provided it satisfies the following conditions relating to substance in Mauritius:

• it carries out its core income-generating activities in Mauritius.

• it employs, directly or indirectly, an adequate number of suitably qualified persons to conduct its core income-generating activities; and

• it incurs a minimum expenditure proportionate to its level of activities.

An investment fund may also be entitled to claim foreign tax paid on its foreign source income as credits against the income tax payable in Mauritius (up to a maximum of 15%) in respect of that income where this can be evidenced (Foreign Tax Credit).

Dividends distributed by an investment fund established as a company to its shareholders would not be subject to withholding tax and interests paid by an investment fund that is established as a company holding a GBL will be exempt from withholding tax to the extent that the interest is paid out of the foreign source income of the fund.

There is no capital gains tax in Mauritius.

Reports

Funds are required to file with the FSC a non-audited quarterly management accounts and yearly audited financial statements.
These reports must include, at least, the following:

• A statement of assets and liabilities, including the net asset value;
• The number of shares outstanding;
• The net asset value per share; and
• Details of the investment portfolio and the movements in the period, disclosed by types of securities and type of market.

The financial statements must be audited in accordance with International Financial Reporting Standards/International Accounting Standards.

Supervision

The FSC has the right to inspect or to cause inspection of the books and records of the fund and request certificate copies of all due diligence documents in conformity with the Anti Money Laundering Act.

Listing

A fund may seek a listing on the Mauritius Stock Exchange. There may be tax advantages to a Mauritius listing.

Mauritius registered investment funds can be and are generally listed on numerous exchanges around the world, the most popular being London and Dublin.

For more information about our services and offerings, please contact us by sending an email to  office@venturecorporateltd.com.