1. The single unified global business licence
2. The abolition of the category 2 global business licence (GBL2) and,
3. The launch of the authorised company: the Financial Services Commission of Mauritius (FSC) has now brought clarity to the proposed changes through two circulars (CL151018 & CL1-121018) that were reproduced in and came into effect through the Finance (Miscellaneous Provisions) Act 2018 (Finance Act). The corresponding changes have been brought to the Financial Services Act 2007 (FSA).
A category 1 global business licence (GBL1) issued by the FSC on or before 16 October 2017 will continue to be valid until 30 June 2021. However, a GBL1 issued after 16 October 2017 will remain valid only until 31 December 2018. As to a GBL1 that remains valid after the transitional date, it will be converted into the new unified global business licence.
For GBL2 companies, there are two categories that have been identified in the same manner as for GBL1 companies. First, a GBL2 issued by the FSC on or before 16 October 2017 will lapse on 30 June 2021. Secondly, a GBL2 issued after 16 October 2017 will lapse on 31 December 2018. Therefore, unless a GBL2 company is wound up, its continued existence depends on its ability to meet with the FSC’s criteria for an Authorised Company or the new Global Business Company in order that it can be converted into one of these two new types of companies. An incentive for GBL2 companies to remain incorporated after their expiry date, as aforementioned, is the FSC’s decision to waive processing and annual fees in respect of applications lodged before 31 December 2018.
As regards the post-transitional period, a GBL2 company must comply with certain requirements namely (i) the FSC’s terms and conditions and, (ii) they remain subject to existing obligations or must comply with directions for the dissolution of their business.
The changes
As from 30 June 2021, companies operating within the global business will either be licensed as Global Business Licence companies or Authorised Companies.
The common denominator to these licences is the 2-fold test below that must be satisfied:
Citizenship Test: a non-citizen must either hold or control the majority of shares in the Mauritian company; and
Conduct of Business Test: the Mauritian company must either intend to conduct its business principally outside Mauritius or with such a category of persons as may be specified in the FSC Rules.
A Unified Global Business Licence (section 29 Finance Act & section 71 FSA)
As from 30 June 2021, the FSC will issue a unified global business licence.
A company with such a licence must display the following features at all times:
it must be managed and controlled from Mauritius;
it must be administered by a management company;
it must employ, whether directly or indirectly, a reasonable number of qualified persons to perform the company’s core business activities; and
it must have a minimum level of expenditure proportional to its level of activities.
The FSC will apply the below criteria, in accordance with the circumstances of each case, to determine whether the Mauritian company is managed and administered in Mauritius:
it reckons at least two resident directors of sufficient calibre to exercise independence of mind and judgment;
directors’ meetings include at least 2 directors from Mauritius;
at all times its accounting records are maintained at its registered office in Mauritius;
its statutory financial statements audited in Mauritius; and
maintains, at all times, its principal bank account in Mauritius.
Authorised Companies (section 29 Finance Act & section 71A FSA)
The concept of authorised company refers to a company with the following characteristics:
at all-times it has a registered agent in Mauritius;
it is a non-citizen, not being a banking institution, which holds the majority of its shares or voting rights or legal, beneficial interests; and
its principal place of effective management is situated outside Mauritius.
Conclusion
The various measures adopted in the National Budget 2018/2019 emphasise the Mauritian Government’s determination to position Mauritius as a sound, reliable and predictable international jurisdiction for its global business thereby providing an alternative platform for investors to consider for furthering their business.
