Incorporating in Mauritius
GBC1 – Global Business Category 1
Incorporating in Mauritius
Mauritius combines almost all the characteristics for an ideal offshore location. It is an independent sovereign State with an economy of substance. It is politically stable and is equipped with the state of the art telecommunication technologies. It has a pool of bilingual professionals trained in Europe and the US. The country has a dynamic banking system with only internationally renowned banks operating in an exchange control free environment. Mauritius has an expanding network of double taxation which allow for efficient tax planning.
Fact Sheet On
Global Business Category 1 (GBC1)
Mauritius GBC I Company (Tax Resident – Treaty Access)
Mauritius GBC I Companies are resident in Mauritius and consequently subject to tax.
However, they benefit from both tax credits and a longstop tax rate of 3%. Correctly structured and managed Mauritius GBC I companies may access Mauritius’ network of 28 tax treaties. Neither capital gains nor withholding taxes are levied.
Consequently, Mauritius GBC I companies are used by tax practitioners and businesses to structure investments into Mauritius’ treaty partners, which include China, India, Luxembourg and Thailand.
Mauritius GBC I Companies are governed by The Companies Act, 2001 and regulated by the Mauritius Financial Services Commission. They are subject to compliance and reporting regimes similar to those of Hong Kong or UK companies.
All companies seeking to benefit from this status are granted licenses on a case by case basis by the regulatory authorities in Mauritius. This procedure demands the submission of a detailed business plan and disclosure of beneficial ownership.
Normally it takes about three weeks to set up a Mauritius GBC I Company.
Key Corporate Features
|Type of entity||GBC I|
|Type of law||Hybrid|
|Shelf company availability||No|
|Our time to establish a new company||4 weeks|
|Minimum government fees (excluding taxation)||US$1,500 to FSC US$250 to ROC|
|Corporate Taxation||Varies from 0% to 3% (maximum)|
|Double taxation treaty access||Yes|
|Share capital or equivalent|
|Permitted currencies||Any except Rs.|
|Minimum paid up||US$1|
|Directors or Managers|
|Local required||Yes, but 2 required for tax treaty access|
|Publicly accessible records||No|
|Location of meetings||Anywhere, but in Mauritius for treaty access|
|Publicly accessible records||No|
|Location of meetings||Mauritius – by proxy|
|Local Required||Local and qualified|
|Requirement to prepare||Yes|
|Requirement to file accounts||Yes|
|Publicly accessible accounts||No|
|Requirement to file annual return||No|
|Change in domicile permitted||Yes|
Mauritius is situated in the Indian Ocean approximately 800 km off the East Coast of Madagascar.
The population of the Island is approximately 1,200,000 made up principally by people of European, African, Indian and Chinese origin. Mauritius takes pride in the fact that these different cultures co-exist in peace and succeed in creating a cultural entity that is distinctly Mauritian.
The British ruled Mauritius for 158 years until 12 March 1968 when it became an independent country within the Commonwealth. The Republic of Mauritius is a Westminster style democracy. The President is the Head of State and Commander in Chief. Full executive power rests with the Prime Minister who is Head of Government. The Members of Parliament are elected every five years by popular vote and a number of political parties contest the elections every five years, reflecting the country’s firm commitment to a multi-party political system.
Since independence in 1968, Mauritius has developed from a low income, agriculturally based economy to a middle-income diversified economy with growing industrial, financial, and tourist sectors. For most of the period, annual growth has been of the order of 5% to 6%.
The government’s development strategy centres on foreign investment. Mauritius has attracted more than 15,000 offshore entities, many aimed at commerce in India and South Africa, and investment in the banking sector alone has reached over US$ 1 billion.
The economy grew by 8.9% in 2000 and the Gross National Income per capita at market prices reached 101,948 rupees. Unemployment rate for 2000 is estimated at about 8.0% while inflation stood at 4.2%.
English is the official language. However, the Mauritian population is largely bilingual, being equally fluent in English and French. Creole is also spoken and understood by everyone.
Type of Law
Common Law for corporate matters.
Principal Corporate Legislation
The Companies Act 2001.
Financial Services Act 2007.
A Company holding a Category 1 Global Business License is resident for tax purposes and can access Mauritius’ network of double tax treaties, provided that it is correctly structured and that the seat of management and control is in Mauritius.
Procedure to Incorporate
Once name approval has been obtained, three copies of the Constitution are submitted, together with a notice of the First Directors, Secretary and location of the Registered Office, and consent forms signed by the Officers.
Restrictions on Trading
A license is required to undertake banking or insurance business or solicit funds from the public.
Powers of Company
A company incorporated in the Republic of Mauritius has the same powers as a natural person.
Language of Legislation and Corporate Documents
The legislation is in English and French whilst documentation may be expressed in any language but must be accompanied by a certified English translation.
Registered Office Required
Yes, must be maintained in Mauritius at the address of a licensed management company or law firm.
Shelf Companies Available
Time to Incorporate
Three to four weeks.
Any name that is identical or similar to an existing company or any name that suggests the patronage of the President or the Government of Mauritius
Language of Name
English or French
Names Requiring Consent or a License
The following names or their derivatives: assurance, bank, building society, Chamber of Commerce, chartered, co-operative, government, imperial, insurance, municipal, royal, state or trust or any name which in the opinion of the Registrar suggests the patronage of the President or the Government of Mauritius.
Suffixes to Denote Limited Liability
Limited, Corporation, Incorporated, Public Limited Company, Société Anonyme, Société Anonyme à Responsabilité Limitée, Sociedad Anónima, Berhad, Proprietary, Naamloze Vennootschap, Besloten Vennootschap, Aktiengesellschaft or the relevant abbreviations.
Disclosure of Beneficial Ownership to Authorities
Yes, not public
Mauritius GBC1 Compliance
The Stated Capital comprises the total amount received and receivable by the company with respect to the issue of shares or calls therewith.
Classes of Shares Permitted
Registered shares, preference shares, redeemable shares and shares with or without voting rights.
Companies pay a fixed annual licence fee of US$ 1,500 and a one-off non-refundable licence application fee of US$ 500 to the Financial Services Commission. On incorporation a one-off fee of US$ 250 is payable to the Registrar of Companies. Thereafter a further US$ 250 is payable annually. Companies are resident in Mauritius for tax purposes. There is no capital gains taxation in Mauritius and there are no withholding taxes on the payment of dividends, interest or royalties from Companies. There are no stamp duties or capital taxes. Companies holding Category 1 Global Business License are liable to taxes at a rate of 15%.
Provided that the Company holding a Category 1 Global Business License owns at least 5% of an underlying company, credit will be available on foreign tax paid on the income out of which the dividend was paid (“underlying foreign tax credit”).
When a company not resident in Mauritius, which pays a dividend, has itself received a dividend from another company not resident in Mauritius (a “secondary dividend”) of which it owns either directly or indirectly at least 5% of the share capital, such dividend will be allowable as a foreign tax credit and an underlying foreign tax credit will also be available.
Mauritius has no thin capitalisation rules. Interest and royalty payments paid by Companies holding a Category 1 Global Business License are fully tax deductible in Mauritius.
Tax sparing credits are available – Under this regime the effective rate of taxation in Mauritius can be reduced as a long stop provision exists whereby Companies holding Category 1 Global Business License may elect not to provide written evidence to the Commissioner showing the amount of foreign tax charged and enjoy deemed taxation at 80% of the normal rate of 15%, i.e. 12%. Thus, use of this long stop provision in isolation would reduce the effective rate of taxation in Mauritius from 15% to 3%.
Double Taxation Agreements
Mauritius has an extensive double tax treaty network which includes treaties with the following countries: Belgium, Botswana, China, Croatia, Cyprus, France, Germany, India, Italy, Kuwait, Luxembourg, Madagascar, Malaysia, Mozambique, Namibia, Nepal, Oman, Pakistan, Rwanda, Singapore, South Africa, Sri Lanka, Swaziland, Sweden, Thailand, Uganda, UK and Zimbabwe.
US$ 1,750 to the FSC.
Registrar of Companies charge approximately:
• US$250 Private Limited Company
• US$350 Public Limited Company
Financial Statements Required
Audited financial statements must be filed with the Financial Services Commission.
Companies holding Category 1 Global Business Licenses require a minimum of two resident Directors who must be natural persons. Treaty access requires a minimum of two local directors.
A qualified resident company secretary must be appointed.
Companies holding Category 1 Global Business License require a minimum of one shareholder and the same rule applies if the company is to be a wholly owned subsidiary. The Financial Services Act requires a GBC I to be administered at all times by a Management Company licensed by the Financial Services Commission and in determining whether a GBL1 should be granted or renewed, the FSC takes into account whether the company will be managed and controlled in Mauritius. In doing so, the FSC may consider, inter,alia, whether the GBC 1:
• will have or has at least 2 directors of sufficient calibre to exercise independence of mind and judgement, resident in Mauritius;
• will maintain or maintains at all times its principal bank account in Mauritius;
• will keep and maintain or keeps and maintains. at all times, its accounting records at its registered office in Mauritius;
• will prepare or proposes to prepare its statutory financial statements and causes or proposes to have such financial statements to be audited in Mauritius;
• provides for meetings of directors to include at least 2 directors from Mauritius.