Mauritius offers an effective business environment in which growth and investment capabilities are efficiently achieved through its conducive corporate infrastructure. There is no minimum capital requirement for a Mauritian incorporated company and shareholding may be 100% foreign held.
The various corporate structures available in Mauritius vary in terms of category, cost, business activity and class. Understanding your requirements is essential in the selection process as it is critical that the applicable entity is utilised.
Governed by the Companies Act 2001. It is tax resident in Mauritius and is liable to tax in Mauritius. It is favourable way to conduct business by Mauritian residents and preferred route for investing in Mauritius. (Including property ownership for business purposes)
Category 1 Global Business (GBC1)
Incorporated and regulated under the Companies Act 2001 and Financial Services Act 2007.
GBC1 structured as tax residents in Mauritius are offered substantial advantages by way of accessibility to taxation treaties signed by Mauritius. These treaties provide that profits can then be withdrawn from that country either without the obligation of withholding tax or subject to a substantially reduced rate of withholding tax based on the tax treaty in place.
Corporate tax in Mauritius is at 15% and GBC1 is entitled to a tax credit equivalent to the higher of the actual or deemed foreign tax suffered (underlying tax) or 80% of the Mauritius tax on its foreign source income. With an applicable tax rate of 15%, combined with a foreign tax credit of 12% (80% x 15%) the effective tax rate for the GBC1 will be a maximum of 3%.
There are no capital gains taxes, nor exchange controls.
While ensuring tax efficiency of investors, Mauritius has also established Investment Promotion and Protections agreements (“IPPAs”), also known as ‘Bilateral Investment Treaties’ with various countries with the objective of protecting and encouraging investments made by Mauritian Companies overseas. IPPAs are of great importance to investors seeking to invest in the developing Asian and African markets and they significantly increase investors’ confidence by ensuring a fair and equitable protection of investments.
IPPAs play a crucial role and are designed to promote investments by creating favourable conditions for greater flow of investments by investors of Mauritius into the territory of the other contracting party.
The following business activities taking place “predominantly” outside Mauritius, with revenue in the form of dividends, royalties, interest or capital gains are as follows:
International trading, investment holding, offshore funds management, offshore Insurance, IT services, IP licensing, pension related services, copyright, industrial designs, patents, trademarks, service marks and other collective marks
The following indicative list of criteria has to be complied with:
- A GBC1 should be administered at all times by a Management Company and should be controlled and managed in Mauritius.
- The Location, constitution and manner in which board meetings are held takes place in Mauritius
- Investment management services provided by GBC1, which revenue authorities will likely see as the day to day senior management of GBC1, takes place from Mauritius
- Scope of advisory services provided by GBC1 takes place from Mauritius
- Implementation of management decisions relating to the acquisition of various investments as well as any disinvestment, the initial funding arrangements and the formation of the company (all seen as essential aspects) takes place in and from Mauritius
- Strategic decisions of the GBC1 and its subsidiaries will be made by the relevant board members at board meetings held in Mauritius
Category 2 Global Business (GBC2)
Established as a resident corporation conducting business outside Mauritius. The GBC2 is not subject to taxation in Mauritius on its worldwide profits, however a GBC2 cannot access the Mauritian double tax treaties (DTT’s) due to the fact that it is a non-resident. A GBC2, at any point in time, can be converted to a GBC 1 category company to realise access to the DTT’s.
A GBC2 must at all times have a registered office in Mauritius where accounting records, statutory documents including register of members, debenture holders and officers are kept. It is recommended that a Register of Charges and Register of Interests are also kept.
Incorporation can be achieved within 48 hours. However it takes a few days for documents to arrive from Mauritius. Ready-made companies are not permitted. As a matter of local company law, the company must maintain a registered office address in Mauritius and appoint a Mauritian resident as a registered agent.
A GBC2 must have a minimum of one shareholder who may be corporate or individual. A GBC2 company must have at least one director who need not be ordinarily resident in Mauritius.
There is no minimum capital requirement, but at least one share must be issued and paid up.
GBC2 companies may issue par value as well as no par value and fractional shares. Bearer shares are not permitted. A Register of Members will need to be maintained by the company, but only shareholders have a right of inspection. The identity of the beneficial owners must be provided to the FSC prior to incorporation and any changes in beneficial ownership must be notified within one month.
No need to prepare accounts in accordance with internationally accepted accounting standards: only a financial summary is needed. No audit is required and it must file a financial summary with the Financial Services Commission on an annual basis.
Can be limited by both shares and by guarantee, this allowing for differentiation in class of members namely, shareholders and guarantee members. Both GBC1 and GBC2 companies can be structured as a hybrid providing flexibility in the financing and distribution of profits within the company. The different rights and obligations that attach to each class of membership can be arranged to create structures that are precisely tailored to the different needs of the client.
Contained in the constitution of the hybrid company are the rights and obligations of each class of members. These can also be set out by its directors in board resolutions which will keep them confidential. Mauritius perhaps offers the most flexibility and advantages on a global scale in terms of hybrid entities.
A Limited Partnership (LP) combines the benefits of limited liability protection with a highly flexible and tax transparent structure. It must consist of one or more general partner(s) and one or more limited partner(s). LPs are principally established for investment purposes, such as in private equity, venture capital and investment funds.
An LP may apply for a Global Business License which allows it the advantages of the tax credit under Double Taxation Avoidance Agreements & Investment Promotion and Protection Agreements that Mauritius has in place with respective countries.
In respect of the above entities we offer a full range of corporate, accounting, legal and taxation services which can be tailored to individual requirements, including:
- company formation
- provision of professional directors, registered agents and registered offices
- corporate trustee services
- compliance with Mauritian laws, regulations and licensing conditions
- introduction of clients to leading banks in Mauritius for opening and operating banks accounts
- Filing of accounts with local authorities.
- management reporting and preparation of statutory financial statements
- preparation of management and statutory accounts
- net asset value (NAV) calculation and accounting
- arranging audits
- preparation and filing of tax returns
- Compliance with regulatory obligations.
Legal support and compliance
Osiris works closely with selected leading Mauritian law firms specialising in the areas of corporate law, project and trade finance, banking, tax, real estate, capital markets, collective investment schemes and cross-border transactions to enable us to provide a comprehensive service to our clients.
In order to help our clients optimise their tax when setting up their offshore structure, we liaise with leading tax experts with experience both locally and internationally.