Mauritius has a modern regime for establishing funds that is recognised by both fund managers and investors and is commonly used for investment structuring into Asia and Africa. Funds set up in Mauritius enjoy a low tax regime and have access to its network of double tax treaties.
Global Funds are licensed as GBC1s and deal in the pooling of public funds to be invested collectively by fund and investment managers. Structured as a company, a trust, a protected cell company or in any other legal form as approved by the FSC, Global Funds can take the form of either a Collective Investment Scheme (CIS) which has a variable share capital, or a Closed-end Fund (CEF) with a fixed share capital. There are five types of CIS:
- Fully Regulated CIS – these are mainly offered to the public and generally do not hold a GBC licence;
- Regulated Global Scheme – authorised by the Financial Services Commission (FSC), holds a GBC1 licence and may be regulated in another jurisdiction;
- Professional CIS – offer shares either to sophisticated investors or by way of a private placement;
- Specialised CIS – invest in real estate, derivatives, commodities or other products authorised by the FSC;
- Expert Fund – a CIS can apply to be authorised by the FSC if the scheme is only available to expert investors, who must make a minimum initial investment of not less than USD100,000 or qualify as sophisticated investors.
Fully Regulated CIS and Regulated Global Schemes are required to have a prospectus in the prescribed format that must set out details with regard to a minimum amount of subscription and at least 5% of the total amount must be raised within 6 months or risk being returned to the investors. Professional CIS, Specialised CIS and Expert Funds only need an offering document in order to be licensed by the FSC.
A Protected Cell Company (PCC) enables a GBC 1 to have one or more cells. It permits the flexibility to divide the assets into various cells with the objective of protecting the assets of one cell against the failure of another cell.
The option of limited partnerships is significant to the funds industry in Mauritius because they are the vehicle of choice for fund structures in many foreign jurisdictions. Limited partnerships are more flexible than companies, and may therefore be more attractive to investment vehicles such as hedge funds, private equity funds and joint ventures.
The Stock Exchange of Mauritius (SEM) previously catered only for investment companies, unit trusts and open-ended funds. In 2010 the listing regulations were amended to include regulated global schemes, professional CIS, specialised CIS, expert funds and CEFs.