Located in the Indian Ocean, Mauritius is a modern island nation that offers a unique blend of natural beauty, cultural richness and economic opportunity.
Since independence in 1968, Mauritius has developed from a low-income, agriculturally based economy to a middle-income diversified economy with main economic sectors such as tourism, textiles and apparel, financial services, ICT, real estate, and property development.
Investors worldwide are attracted to Mauritius because of its favourable business policies, robust infrastructure, and beneficial tax system.
Business entities in Mauritius
Some of the commonly used business structures in Mauritius are:
Domestic company
A domestic company is incorporated under the Companies Act 2001. This act provides the legal framework for the formation, management, and dissolution of companies in Mauritius.
Domestic companies are primarily engaged in business activities within Mauritius, such as trading, manufacturing, construction, service provision, and acquisition of immovable property under the Property Development Scheme. While their main operations are local, they can also engage in export activities and trade with international markets.
Local or foreign shareholders can own a domestic company wholly but must comply with local regulations and policies. It must have at least one director, who may be a resident or non-resident of Mauritius. However, certain companies, such as those engaged in regulated activities, may require resident directors.
Types of domestic companies in Mauritius:
- Private company: A private company is limited by shares and restricts the right to transfer its shares. It cannot have over 50 shareholders or invite the public to subscribe to its shares.
- Public company: A public company can offer its shares to the public and does not have a restriction on the maximum number of shareholders.
- One-person company: A private company with only one shareholder, providing a simpler structure for individual entrepreneurs.
Compliance and reporting requirements for domestic companies:
- Annual returns: Domestic companies are required to file annual returns with the Registrar of Companies.
- Financial statements: Companies must prepare financial statements in accordance with International Financial Reporting Standards (IFRS) and file them with the Registrar.
- Taxation: Domestic companies are subject to Mauritian corporate tax. The current corporate tax rate is 15%, but various incentives and tax holidays may apply depending on the sector and specific activities of the company.
Overall, domestic companies in Mauritius benefit from a supportive business environment, favourable tax policies, and a strategic location, making the country an attractive destination for business operations and investment.
Global Business Corporation (GBC)
The GBC (formerly known as GBC1) is registered under the Companies Act 2001 and licensed by the Financial Services Commission (FSC) which is governed by the Financial Services Act 2007.
A GBC is a tax-resident entity. GBCs must always carry out their core income generating activities in, or from, Mauritius, as required under the Income Tax Act. It can engage in a variety of activities, including international trade, investment holding, asset management, and financial services (though it is subject to additional licenses).
A GBC must be managed and controlled within Mauritius and more importantly, be administered by a management company. GBCs must at all times have two resident directors. Corporate directorship is not allowed. The two resident directors must be present for a meeting to be quorate and valid. Meetings should be chaired from Mauritius. Moreover, a GBC shall at all times have a management company as secretary.
Compliance and reporting requirements for a Mauritius GBC:
- Financial statements: GBCs must submit their financial statements to the FSC within six months of their balance sheet date.
- Annual returns: A corporate tax return is filed with the Mauritius Revenue Authority (MRA).
- Audit: Must appoint a local auditor and have its financial statements audited.
- Economic substance regulations: Must comply with economic substance requirements to ensure substantial activities are conducted in Mauritius.
Taxation:
- Subject to a corporate tax rate of 15%, with potential foreign tax credits that can reduce the effective tax rate to 3%.
- Eligible for benefits under Mauritius’ network of DTAAs.
Overall, a Global Business Corporation in Mauritius is an attractive structure for businesses looking to leverage the country’s advantageous tax regime, strategic location, and robust legal framework for international operations.
Learn more about Mauritius GBC.
Authorised Company (AC)
Authorised Companies are registered under the Companies Act 2001 and regulated by the Financial Services Commission (FSC) under the Financial Services Act 2007.
An AC is a tax-exempt, flexible business entity regularly used for international investment holding, international property holding, international trade, IT-related services, logistics, marketing and international management and consultancy.
An AC is considered non-resident for tax purposes, meaning it is not subject to Mauritius corporate tax. The company must be controlled by a majority of shareholders with beneficial interests who are not citizens of Mauritius. The company must have its place of effective management outside of Mauritius. Such a company can have at least one shareholder and shall not have more than 50 shareholders. Beneficial ownership information is disclosed to the authorities in Mauritius.
An AC is NOT allowed to engage in:
- Banking
- Financial services
- Fiduciary
- Managing or dealing with a collective investment scheme
- Trusteeship services
Compliance and reporting requirements for a Mauritius AC:
- Financial summary: They are required to file a financial summary with the FSC within 6 months of their balance sheet
- Annual returns: A return on income is filed with the MRA within 6 months of the financial year end.
- Registered agent: An Authorised Company must appoint a registered agent in Mauritius, who is responsible for ensuring compliance with local regulations and maintaining company records.
Taxation:
- Tax exemption: Authorized Companies are exempt from corporate tax in Mauritius, as they are not deemed tax residents.
- Other taxes: They may be subject to other taxes or reporting requirements in the jurisdictions where they operate.
In summary, an Authorised Company in Mauritius offers a flexible and tax-efficient structure for businesses primarily engaged in activities outside the country, providing a straightforward alternative to Global Business Corporations without the same level of regulatory and tax obligations.
Learn more about Mauritius AC.
Other entity types
Societés or partnerships
A partnership is an association of two or more partners (associés) formed for a specific purpose. Societés, commonly called partnerships, are governed by The Code de Commerce (Amendment) Act, Act 21 of 1985. The duration (durée) of a partnership is determined in the deed (status) but shall not exceed 99 years. However, the partners may, at any time before the duration comes to an end or ends, either renew, extend or dissolve the partnership.
Limited partnerships
A limited partnership is set up under the Limited Partnerships Act 2011. A limited partnership can elect to have legal personality and must have at least one general partner who is liable for all the debts and obligations of the partnership and one limited partner who is liable only up to the maximum amount of its commitment. A limited liability partnership (LLP), introduced by the Limited Liability Partnerships Act 2016 (LLP Act), is a new partnership vehicle. It combines features of both a company and a limited partnership.
Foundations
A foundation is set up under the Foundation Act 2012. A foundation can be set up for any purpose specified in its charter, provided its objects are not contrary to the laws of Mauritius. Purposes can be charitable, non-charitable or both, and for the benefit of a person or a class of persons, carry out a specified purpose, or both.
Trusts
Mauritius trusts are regulated by the Trusts Act 2001, the Code Civil Mauricien and the common law relating to trusts. A Mauritian trust is not registered with any governmental body. A settlor may opt to register a trust with the Mauritius Registrar General. A trust must have at all times, at least one qualified trustee (a management company licensed by the Financial Services Commission).
Conclusion
The above business structures offer flexibility to cater to different business needs and objectives, supported by Mauritius’ favourable regulatory and tax environment.
