At a time when other countries were struggling in the midst of an economic recession, Africa is one of the few continents which has stood firm against all odds. Africa has seen massive economic expansion in various sectors including minerals and energy, agriculture, technology, telecommunications, media and financial services. It has over the past few decades emerged as the ultimate land of opportunities for all avid investors around the world.

It is a known fact that Mauritius has been a key player and partner to Africa in this culminating success as an emerging market for investment. Mauritius has positioned itself as the jurisdiction of choice for routing foreign investment into Africa due to its numerous advantages as an investment gateway.

Situated at the door of the African continent, Mauritius occupies a strategic geographical location in the Indian Ocean granting the rest of the world easy access to Africa. The well developed infrastructure, the flexible legal framework, the favorable tax regime and the high end telecommunication services make Mauritius the ideal channel for investment into Africa.

Why choose a trust?

Investors and high net worth individuals are always on the look out for investment opportunities which are tax efficient and appropriate for estate planning. A trust is an investment vehicle which offers such a structure. It allows global investors to channel their investments in the African continent whilst yielding all tax relating benefits in Mauritius.

The Legal Framework

The historical journey of the legal regime for trust evolved in three stages. The first piece of legalisation on trusts to hit the Mauritian territory was the Trusts Act 1989. It applied to resident trusts and not to non-resident trusts. To remedy this lacuna, the Offshore Trusts Act 1992 was enacted a few years later, to regulate non-resident trusts. In view of this piece meal legislation regarding the area of trusts, the parliament took the step to bring under one single framework both resident and non-resident trusts and this culminated in the enactment of the Trusts Act 2001 (the Act).

Types of Trusts

The Act allows for various types of trusts such as:

Protective or spendthrift trust

Asset protection trust

Charitable trust

Purpose trust


Characteristics of the Mauritius Trust

The Mauritius Trust has certain particular characteristics that make it an attractive vehicle for investment. Some of the key features are as follows:

1. Appointment of Protector: The Act allows for the appointment of a protector for to act as an advisor and to oversee the activities of the trustees.

2. Confidentiality: The Act seeks to protect all confidential information pertaining to a trust. It does not require the registration of a trust nor does it impose filing requirements for a trust. No third party is entitled to gain access to the deliberations of the trustee and nor is he entitled to know the identity of the trustees and the settlor of the trust. Further to that, there is no obligation on the trustee to disclose to any person, any information or document under his control. The only circumstance where he will be required to disclose such information or document is where he has been ordered by the Court or the Judge in Chambers to do so.

3. No forced heirship rule: When a non- resident settlor transfers or disposes trust property, the transfer or disposition shall not be set aside, avoided, or otherwise declared invalid or ineffective by virtue of any rule or law of his domicile or nationality relating to inheritance or succession or any rule or law of a similar nature. The Act also provides that such a transfer or disposition will not be set aside by virtue of any rule or law restricting the right of a person to dispose of his property during his lifetime so as to preserve such property for distribution at his death.

4. Asset Protection: The Act is geared towards the protection of the interests of the trust. As such it prevents the trust from being challenged for reasons of succession rights, marriage or divorce and insolvency of a settlor or beneficiary. Even the approach of the Mauritian courts with respect to this has turned out to be quite conservative. For instance, where there is a foreign judgment which has been delivered against the trust property in relation to a trust regulated by the law of Mauritius, the Mauritian Courts will refuse to enforce same.

5. Access to taxation benefits: Trusts are generally subject to taxation on their chargeable income at a rate of 15% per annum.

a) Non resident trust: a non-resident trust is exempt for taxation in Mauritius. There are 3 situations where a trust may opt to be a non-resident:

(i) Where the settlor is a non-resident and the appointed beneficiaries are non-resident or holders of global business license;

(ii) Where the settlor holds a global licence and the appointed beneficiaries are non-resident or holders of global business license;

(iii) Where it is a purpose trust whose purpose is carried out outside Mauritius.

b) Resident trust: a resident trust is subject to taxation in Mauritius. A resident trust which is the holder of a Category 1 Global Business License will have the added advantage of being taxed at a reduced rate of 0-3%. The trust may reap further taxation benefits by becoming a tax resident in Mauritius. This will allow them to claim the benefits available the different Double Taxation Avoidance Agreements to which Mauritius is a signatory.

The combined features of the Mauritius trust make it a rather appealing and effective vehicle for those who are interested in directing their investment into the African continent.

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