Mauritius used to rely mainly on its sugar and tourism industries, but the Government of Mauritius has sought to diversify and remains active in trying to develop new sectors to create growth in the economy. The 1980s created a boom in the textile industry, and the Government of Mauritius has sought to develop its services industry since then. The 1990s called for the development of the financial services sector, and Mauritius has since firmly established itself as a sound and reliable financial services jurisdiction on an international level. Since the early 21st century, Mauritius has sought to develop its Information and Communication Technology (ICT) industry so as to make it one of the pillars of the economy and to position itself as a hub in Africa. Mauritius has therefore sought to implement various laws to cater for the development of the ICT industry, including the Information and Communication Technologies Act 2001, the Computer Misuse and Cybercrime Act 2003, and the Data Protection Act 2017 (replacing the former Data Protection Act 2004).

The Information and Communication Technologies Authority is the regulatory body and provides guidelines to industry players. It also issues licences, and monitors and supervises the ICT industry in Mauritius.

The Ebene Cybercity in Mauritius was developed with the idea of being a hi-tech hub, and has now developed into a modern financial centre providing high-quality offices and amenities. It is now the second business city of Mauritius after Port Louis, and many businesses have subsequently moved there.

Since 2016, Mauritius has started to look at developing the Fintech sector and providing facilities for the development of this industry. Though still in the early stages, the Fintech industry is slowly developing. As a jurisdiction, Mauritius is friendly to Fintech innovation and is trying to implement the necessary regulations to encourage the development of the Fintech industry.

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TECHNOLOGY AND INNOVATION

1. Are there any “sandbox” or other regulatory neutral zones?

The Economic Development Board (“EDB”) (formerly known as the Board of Investment) has issued a new type of licence: the Regulatory Sandbox Licence (RSL), which was announced in the 2016-2017 National Budget in Mauritius and proclaimed on the 20th October 2016. The RSL offers the possibility for an investor to conduct a business activity for which there is neither a legal framework nor adequate provisions under existing legislation in Mauritius. The RSL is issued by the Economic Development Board to eligible companies willing to invest in innovative projects according to an agreed set of terms and conditions for a defined period.

2. Is there a Digital “incubator” or hub?

There are no designated economic zones for the conduct of offshore business including Fintech. Activities for the promotion of offshore business would be conducted by the EDB for and on behalf of the Mauritian Government.

3. Are there any barriers to entry for foreign companies?

The Companies Act 2001 of Mauritius provides for circumstances under which a foreign company may be registered with the Mauritian Registrar of Companies for the conduct of offshore business.

4. Have traditional institutions embraced new technologies?

The market is still dominated by traditional banking in Mauritius but there is a lot of interest in the Fintech industry among entrepreneurs. There have also been talks of developing Mauritius as a Fintech hub for Africa due to the buoyant Information, Communication and Technology sector and the country’s highly qualified bilingual workforce, Mauritius is well placed to develop its Fintech industry further and position itself highly in the African region.

Thus, in the World Blockchain Summit 2018 which was held in Mauritius on 30 November 2018, the Mauritian Minister of Technology, Communication and Innovation re-affirmed the support of the Mauritian Government to Blockchain and confirmed the ambition of the Mauritian Government to establish Mauritius as a Blockchain hub for the African region.

Furthermore, on 14 August 2020, the Financial Services Commission of Mauritius (‘FSC’) issued the Financial Services (Peer to Peer Lending) Rules 2020 which enable the operation of Peer to Peer lending platforms in Mauritius by P2P Operators which hold Peer to Peer Lending licences issued by the FSC. The Peer to Peer Lending Rules apply to Peer to Peer Operators licensed by the FSC and came into force on 15 August 2020.

Finally, during the meeting of the Mauritian Cabinet of Ministers on 23 October 2020, the Cabinet issued formal drafting directives to the Attorney General in relation to the Emerging Technologies Council Bill so as to, amongst others, facilitate and oversee the rapid implementation of emerging technology in Mauritius.

6. What AML requirements apply to FinTech businesses in Mauritius?

We consider that the same AML requirements would apply to FinTech businesses as a financial institution under the Financial Intelligence and Anti-Money Laundering Act 2002 (FIAMLA).

Therefore, Fintech businesses would be required to adhere to the Anti-Money Laundering and Counter-Terrorist Financing (AML/CFT) related laws, regulations and codes in Mauritius including the FSC Code on the Prevention of Money Laundering and Terrorist Financing.

7. Are electronic signatures valid?

The Electronic Transactions Act provides that no signature will be denied legal effect, validity or enforceability solely because it is in electronic form.

An “electronic signature” means an electronic sound, symbol or process attached to or logically associated with an electronic record, and executed or adopted by a person with the intent to sign the electronic record.

The Electronic Transactions Act also provides for secure electronic signatures, which may be useful in the application of a prescribed security procedure or a commercially reasonable security procedure agreed to by the parties involved. In such a case, an electronic signature will be verified as a secure electronic signature if, at the time it was made, it was:

  • unique to the person using it;
  • capable of identifying such person;
  • created in a manner or using a means under the sole control of the person using it; and
  • linked to the electronic record to which it relates in a manner such that the electronic signature would be invalidated had the record been changed.

8. How is personal data protected?

The Data Protection Act 2017 provides for privacy and protection of personal data which is based on the premise that the collection of personal data must only be done for a lawful purpose connected with a function or activity of the data controller and the collection must be necessary for that purpose. The personal data subject is strictly protected, and his/her data cannot be amended or used without his/her authorisation.

Digital Asset Service Provers

1. Can a crypto-to-crypto exchange be established?

This is not regulated presently.

2. Can a crypto-to-fiat exchange be established?

This is not regulated presently.

3. Is a money services licence required for crypto-to-fiat conversion through an OTC desk?

This is not regulated presently.

4. Can a digital assets project establish a local bank account?

This is not regulated presently.

5. Can you register as a digital asset custodian in Mauritius?

Yes.

6. Are VASPs subject to the local AML regime?

Yes.

Tokenised funds

1. Are tokenised funds regulated in Mauritius?

Tokenised funds are not expressly regulated under the laws of Mauritius. However, the FSC recognises that Digital Assets may constitute an asset-class for investment by Expert Funds.

The FSC considers ‘digital asset’ as any token, in electronic form, which is representative of either the holder’s access rights to a service or ownership of an asset.

2. What service providers are required for a tokenised fund?

This is not regulated presently.

3. What AML/KYC is required for token holders?

This activity is not regulated presently, however, the same quotient of AML/KYC would currently apply, as it would to other applicants.

4. Is there a minimum investment amount?

This is not regulated presently.

5. Can token holders redeem their tokens or transfer the tokens they hold?  

This is not regulated presently.

Economic Substance

1. Does Mauritius impose economic substance requirements?

Mauritius did not incorporate the concept into its laws as it has been done in other international financial centres. However, the measures which the jurisdiction has adopted come close to these. An entity (other than a holding entity, and entities that conduct intellectual property business, for which there are different criteria) conducting a relevant activity will satisfy the economic substance requirements if:

  • it is managed and directed in the jurisdiction;
  • core income generating activities (CIGA) are undertaken in the jurisdiction in relation to the relevant activity;
  • it maintains adequate physical premises in the jurisdiction;
  • there are adequate employees in the jurisdiction with suitable qualifications;
  • there is adequate expenditure incurred in the jurisdiction in relation to the relevant activity; and
  • it files a confidential economic substance report each year with the applicable authority in its jurisdiction which will assist the authority in assessing compliance.

The substance requirements for a Global Business Company are-

  • at least 2 directors, resident in Mauritius;
  • maintain or maintains at all times its principal bank account in Mauritius;
  • keep and maintain or keeps and maintains, at all times, its accounting records at its registered office in Mauritius
  • prepare, or proposes to prepare or prepares its statutory financial statements and causes or proposes to have such financial statements to be audited in Mauritius; and
  • provide or provides for meetings of directors (to include at least 2 directors from Mauritius).

2. Are there any reporting requirements in connection with economic substance?

Yes, the companies having CIGA in Mauritius have reporting obligations mainly to the Financial Services Commission.

3. What penalty provisions apply in the case of non-compliance?

For breach of the Financial Services Act and its regulations, an offence is committed and on conviction, where no specific penalty is provided, a fine not exceeding MUR 500,000 and imprisonment for a term not exceeding 5 years may be imposed.

Intellectual Property

2. Trade Marks

The PIDTA, which we understand is under review, captures the following with respect to trade marks:

  1. “collective mark” which means any visible sign designated as such in the application for registration and capable of distinguishing the origin or any other common characteristic, including the quality of goods or services, of different enterprises which use the sign under the control of the registered owner of the collective mark;
  2. “mark” which means any visible sign capable of distinguishing the goods (trademark) or services (service mark) of an enterprise from those of other enterprises; and .
  3. “tradename” which means the name or designation identifying and distinguishing an enterprise

The exclusive right to a trade mark in Mauritius is gained through registration with the Controller of Industrial Property Office (Controller).

Under the PIDTA an application to register a trademark, collective mark or trade name is submitted to the Controller together with the following:

    1. the prescribed fee;
    2. a reproduction of the trademark, collective mark or trade name, as the case may be;
    3. the list of classes of goods and services in respect of which the application is made in conformity with the international classification of the same as contemplated under the Nice Agreement concerning the International Classification of Goods and Services for the Purposes of Registration of Marks of 15 June 1957 (Nice Classification).

The PIDTA authorises an applicant to claim priority as contemplated under the Paris Convention for the Protection of Industrial Property 1883 (Paris Convention).

A registered trademark, collective mark or trade name is valid for a period of ten years from the filing date of the application. At the expiry of the registered period, a registered owner may apply for the renewal of the registration for consecutive periods of ten years provided (a) the renewal fee is paid and (b) any conditions as may be prescribed by the PIDTA are fulfilled.

3. Patents

Under the PIDTA, patents have been defined as the title granted to protect an invention which means an idea of an inventor which provides the solution to a specific problem in the field of technology. However, the PIDTA sets out an exhaustive list of “inventions” which shall be excluded from patent protection.

In order to achieve the exclusive right to a patent, an application is to be lodged with the Controller as follows:

    1. an application form in the English language and in the form set out at either of the Second, Ninth or Fourteenth Schedule of the Patents, Industrial Designs and Trademarks Regulations 2004, as the case may be (PIDTA Regulations);
    2. documents in support of the application together with translations in the English language where the documents in support are in a foreign language;
    3. an original Power-of-Attorney duly registered with the Registrar General of Mauritius where the applicant appoints an approved agent to submit its application; and
    4. an application fee of Rs 5,250.

Once registered, a patent is valid for a period of 20 years from the filing date. The validity of a registered patent during this period is conditional upon the payment of an annual fee to the Controller of Industrial Property Office. The PIDTA expressly declares that a failure to pay the annual registration fee will mean that “the patent application [has] been withdrawn and the patent shall lapse”.

4. Trade Secrets

Trade secrets are not contemplated in the PIDTA. However, in Mauritius, they may be protected in the following ways:

• non-disclosure agreements and confidentiality clauses can be provided in commercial contracts to protect trade secrets;

  • In cases where there are risks that confidential information might be used and/or disclosed to third parties, an application for an injunction may be made to the Honourable Judge in Chambers, to restrain disclosure of confidential information to third parties and/or use of the confidential information; and
  • Damages may be claimed by a party aggrieved by disclosure of confidential information and/or the use of such.

DIGITAL ASSETS

1. How are digital assets regulated?

Digital assets are regulated by the Financial Services (Custodian services (digital asset)) Rules 2019.

2. Are digital assets subject to the local AML regime?

Yes. The Financial Intelligence and Anti-Money Laundering Act 2002 is the main legislation with respect to Anti-Money Laundering in Mauritius.

However, the Bank of Mauritius has so far been very cautious in its approach to cryptocurrencies, they issued a warning on the 18 December 2013, advising members of the public to exercise utmost care and diligence when dealing with virtual currencies, and further explaining that members of the public need to be aware of the risks associated with unregulated virtual currencies, which do not provide the same protection as ‘hard’ or ‘real’ money. Again, on the 9 August 2017, the Bank of Mauritius issued a public notice to the effect that cryptocurrencies are not issued or guaranteed by the Bank and that users of cryptocurrencies are exposed to risks and that exchange platforms for cryptocurrencies are unregulated.

3. Is a physical presence required in Mauritius to conduct a digital asset sale?

Yes, the issuer is required to have a registered office and a representative in Mauritius.

4. Are gambling platforms permitted?

The law does not expressly provide for gambling platforms with respect to digital assets.

The FSC considers cryptocurrencies as being a store of value. They are not deemed to have legal tender status in Mauritius but they can be exchangeable for other things having value, thereby showing characteristics akin to physical commodities such as grain or precious metals.

5. Can decentralised-finance (DeFi) products be launched from Mauritius?

Yes.

5. Can decentralised-finance (DeFi) products be launched from Mauritius?

Yes.

DOING BUSINESS IN MAURITIUS

1. Trade Licences

This will depend on the type of business carried out.

2. Tax Matters

The Mauritian taxation system is regulated by the Income Tax Act 1995 and sets a taxation rate of 15% on chargeable income. The Mauritius Revenue Authority (MRA) is the regulator for taxation.

Personal tax is based on the concept of residence for individuals who become taxable for a given financial year if they are physically present in Mauritius in an income year or an aggregate period of 183 days or more, of for the 2 preceding income years for an aggregate period of 270 days or more. The non-resident is liable to tax on all income derived from Mauritius where he has remained in Mauritius for less than 183 days in a tax year or 20 days for 2 consecutive tax years.

Corporate tax is also subject to 15% and applies to profits of the accounting period ending in the tax year and captures companies, trusts , ‘sociétés’ and partnerships. Within the offshore category, a company licensed as a Global Business Company is liable to a maximum tax rate of 3% by reason of the application of Anti Double Taxation Agreements that the Mauritian Government has entered into with various foreign Governments.

Furthermore, a company licensed as an Authorised Company is not considered to be resident in Mauritius for taxation matters and is therefore exempt from taxation under the enabling legislation.

Dividends paid by Mauritian resident companies are exempt from income tax whilst interests are taxed as ordinary income, subject to available exemptions and tax credits. Royalties are taxed as ordinary income, subject to available exemptions and tax credits. As to fees, both directors’ and consultant fees are taxable at 15%.

As to indirect taxation, there is a compulsory registration for Value Added Tax (VAT) at 15% for a company where its annual turnover of taxable supplies exceeds MUR 6 million [USD 167,000] or it is engaged in any business or profession such as liberal profession including accountants, lawyers in respect of which there is no minimum threshold. There is an online fast track system for processing VAT claims.

Alternative Tax Dispute Resolution (ATDR) is a fast track system to resolve tax disputes by which tax payers may apply for a review of assessment raised in excess of MUR 10 million [USD 278,000] before the Mauritian Supreme Court. On receipt of an application, the Director General of the MRA has an obligation to refer the case to the ATDR Panel within one month and inform the applicant accordingly. The ADTR Panel has an obligation to make a decision within a period of 6 months from the date on which it has been referred the case for review. The Director General of the MRA may then amend or maintain the assessment in conformity with the decision of the ATDR Panel.

3. Visas and Work Permits

Foreign nationals coming for business activities or applying for an Occupation Permit should enter Mauritius on a Business Visa. As provided in the Employment (Non-Citizens) (Restriction) Exemptions Regulations 1970, certain categories of foreigners workers in the artistic and creative fields, , amongst others, are allowed to work in Mauritius on a business visa for a maximum of 90 days only in one calendar year. Such categories of expatriates shall apply for a work and residence permit after the 90 days. It is issued for up to 120 days per calendar year.

Multiple entry business visa will be granted for a period of 2 years at the rate of 120 days in a calendar year. The stay per trip should not exceed 90 days. Foreign nationals coming to work in companies in the Information Communication Technologies sector should enter Mauritius on a Business Visa, pending the issue of the relevant work permit.

The Non-citizen (Employment Restriction) Act 1972 provides that a Non-citizen shall not engage in any occupation in Mauritius for reward or profit or be employed in Mauritius unless there is in force in relation to him, a valid permit. The Act also provides that “no person shall have a Non-citizen in his employment in Mauritius without there being in force a valid permit in relation to that employment.

The Work Permit entitles the foreign national to work in Mauritius for a specific employer and for a designated period of time. It is personal and non-transferable.

As a result of the COVID-19 pandemic, the Mauritian Government innovated its permits to foreigners to work in Mauritius through the introduction, on 23 October 2020, the Premium VISA which authorises a foreigner who forms part of a country whose nationals have been exempted from requiring a VISA in order to travel to Mauritius, to enter Mauritius and reside in a COVID-19 free destination for a period of 1 year and which is renewable.

The Premium VISA applies to the following category of foreigners namely:

  • (a) retired persons from countries where COVID-19 places them at a health risk and to whom it would be beneficial to move to a COVID-19 safe country;
  • (b) repeat tourists who intended to retire and migrate to Mauritius prior to the outbreak of the COVID-19 pandemic;
  • (c) investors and professionals who are keen to come with their families in order to pursue their business or work remotely from Mauritius or extend this facility to their personnel;
  • (d) foreigners whose children are undertaking their studies in Mauritius.

Finally, the following are the criteria for the grant of a Premium VISA to foreigners namely:

  • (a) they must not enter the Mauritian labour market;
  • (b) they must hold their main place of business and source of income and profits outside Mauritius;
  • (c) they must hold documentary evidence to confirm the purpose of their visit, accommodation; and
  • (d) they must comply with other immigration conditions.
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