29 April 2009

Seminar on Islamic Capital Markets Mauritius

Mauritius will host the Islamic Financial Services Board (IFSB) Seminar on Islamic Capital Markets from 19 - 20 May 2009. The event, which is being jointly organised by the IFSB, the Bank of Mauritius (BoM) and the Financial Services Commission (FSC) of Mauritius aims at enhancing awareness on the Islamic capital market and its role in the Islamic financial services industry.

By hosting this event, Mauritius aims at promoting the implementation of Islamic financial services in the country. This initiative underlines the full support of Mauritius in promoting the works of the IFSB. The event will help in positioning Mauritius as an international financial centre with a strong value proposition for Islamic financial services and will give an additional edge to tap new business avenues outside the country.

About the Islamic Financial Services Board

The Islamic Financial Services Board (IFSB), which is based in Kuala Lumpur, Malaysia, was officially inaugurated on 3rd November 2002 and started operations on 10th March 2003. It serves as an international standard setting body of regulatory and supervisory agencies that have vested interest in ensuring the soundness and stability of the Islamic financial services industry, which is defined broadly to include banking, capital market and insurance. In advancing this mission, the IFSB promotes the development of a prudent and transparent Islamic financial services industry through introducing new, or adapting existing international standards consistent with Shari'ah principles, and recommend them for adoption. To this end, the work of the IFSB complements that of the Basel Committee on Banking Supervision, International Organisation of Securities Commissions and the International Association of Insurance Supervisors.

The members of the IFSB include regulatory and supervisory authorities, international inter-governmental organisations (International Monetary Fund, The World Bank, Bank for International Settlements, Islamic Development Bank, Asian Development Bank) and market players from various countries.

Malaysia, the host country of the IFSB, has enacted a law known as the Islamic Financial Services Board Act 2002, which gives the IFSB the immunities and privileges that are usually granted to international organisations and diplomatic missions.

Adoption of standards

Since its inception, the IFSB has issued nine standards, guiding principles and technical note for the Islamic financial services industry focusing on Risk Management, Capital Adequacy, Corporate Governance, Supervisory Review Process, Transparency and Market Discipline, Recognition of Ratings on Shari`ah-Compliant Financial Instruments, Development of Islamic Money Markets, Special Issues in Capital Adequacy Requirements for Sukuk and Real Estate, as well as Governance for Collective Investment Schemes. The IFSB is working on new standards and guidelines on (1) Corporate Governance in Takaful Operations; (2) Shari`ah Governance and (3) Conduct of Business. The standards prepared by the IFSB follow a lengthy due process as outlined in its Guidelines and Procedures for the Preparation of Standards/ Guidelines which involve, among others, the issuance of exposure draft and, where necessary, the holding of a public hearing.

Awareness promotion

The IFSB is actively involved in the promotion of awareness of issues that are relevant or have an impact on the regulation and supervision of the Islamic financial services industry. This mainly takes the form of international conferences, seminars, workshops, trainings, meetings and dialogues staged in many countries.

For more information on IFSB, please visit http://www.ifsb.org


About the Bank of Mauritius

The Bank of Mauritius (BoM) is the central bank of Mauritius. Our principal role as defined in the Bank of Mauritius Act 2004 is to maintain price stability and to promote orderly and balanced economic development.

Functions of the BoM
  • to conduct monetary policy and manage the exchange rate of the rupee, taking into account the orderly and balanced economic development of Mauritius;
  • to regulate and supervise financial institutions carrying on activities in, or from within, Mauritius;
  • to manage, in collaboration with other relevant supervisory and regulatory bodies, the clearing, payment and settlement systems of Mauritius;
  • to collect, compile, disseminate, on a timely basis, monetary and related financial statistics;
  • to issue Mauritian currency notes and coins;
  • to manage the foreign exchange reserves of Mauritius;
  • to ascertain and promote the soundness of financial institutions and their compliance with governing laws, rules and regulations;
  • to adopt policies to safeguard the rights and interests of depositors and creditors of financial institutions, having due regard to the need for financial institutions to compete effectively in the market and take reasonable risks; and
  • to act as the Banker to banks and to the Government.
History of BoM

The Bill for the establishment of the Bank of Mauritius as the central bank was passed by the Legislative Assembly on 26 July 1966. It received the assent of the Governor-General on 28 September 1966 and became an Act when it was gazetted on 15 October 1966. The first Directors of the Board of the Bank were appointed in July 1967 and the Bank of Mauritius started its operations in August 1967. The Act of 1966 witnessed many changes over time until the year 2004 when it was repealed and replaced by a new Bank of Mauritius Act 2004.

Recent Developments

Since the establishment of the BoM, the financial system in Mauritius has become increasingly sophisticated. Exchange control was completely abolished in July 1994. The exchange rate of the rupee is now freely determined by market forces. Interest rates are determined on the market as well and direct credit control is no longer an instrument of monetary control. The Bank of Mauritius has thus moved to an indirect method of monetary control. As a legal requirement, the Monetary Policy Committee (MPC) was formally launched on 23rd April 2007. In August 2007, The Bank of Mauritius Act 2004 was amended to empower the MPC to independently formulate and determine the monetary policy of the Bank.

Responding to changes in the financial services industry, the BoM and the Financial Services Commission (FSC) formalised their collaboration and co-operation through the signature of a Protocole d’Accord and the setting up of a Joint BOM/FSC Co-ordination Committee. This closer collaboration will further serve to enhance the stability of the financial system in Mauritius. The BoM is also committed to setting up the necessary framework for the conduct of Islamic Banking, which is one of the world’s fastest growing financial segments.

For more information on BoM, please visit http://bom.intnet.mu/


Financial Services Commission

Vision Statement

To be an internationally recognised financial supervisor committed to the sustained development of Mauritius as a sound and competitive Financial Services Centre

Mission statement

In carrying its mission, the Financial Services Commission (FSC) aims:
  • To promote the development, fairness, efficiency and transparency of financial institutions and capital markets in Mauritius.
  • To suppress crime and malpractices so as to provide protection to members of the public investing in non bank financial products.
  • To ensure the soundness and stability of the financial system in Mauritius for the benefit of the economy.
Corporate profile

The Financial Services Commission (FSC) is the integrated regulator for global business and financial services other than banking in Mauritius. The Commission was established in 2001 and it operates under the Financial Services Act 2007 to license, regulate, monitor and supervise the conduct of business activities in these sectors.

The main objective of the Commission is to foster a sound environment conducive to business and to safeguard the integrity of Mauritius as an International Financial Centre (IFC). Whilst creating a favourable environment for the development of financial businesses, the Commission aims to position Mauritius as a strong IFC, built on the premise of good reputation, sustained credibility and substance. The FSC also focuses on the protection of consumers by promoting public understanding of financial services and products.

The FSC’s regulatory mandate covers credit services, securities, collective investment funds, custody and trust services, commodities futures trading, Islamic finance, insurance and pension funds, global business as well as an international commodities derivatives exchange.

Regulatory Approach

The regulatory framework in place, enhanced by the coming into force of a new set of legislations (Financial Services Act 2007, Securities Act 2005, Insurance Act 2005), rules and regulations in 2007, reflect the norms adopted by international standard-setting bodies, such as the International Organisation of Securities Commissions (IOSCO), the International Association of Insurance Supervisors (IAIS), the Financial Action Task Force, the Basel Committee, the International Monetary Fund and the World Bank. International regulatory standards foster good governance and encourage best practice.

Hence, the FSC also applies necessary procedures relating to anti-money laundering and combating the financing of terrorism through the relevant Codes issued thereby reducing the risk of financial crime.

The Commission is responsible for undertaking compliance and inspection visits to all licensees at frequencies determined according to the risk profile of each licensed entity.
The Commission ensures compliance in the sector through regular on-site inspection to all licensees. With the coming into operation of the Risk-Based Supervision Framework, the frequencies of inspections will be determined according to the risk profile of each licensed entity. The RBS system assesses each licensee for the risk it poses to the attainment of the statutory objectives of FSC.

The FSC also focuses on the protection of consumers by promoting public understanding of non-bank financial services and products, thereby reducing the risks of financial crime and market abuse.

Moreover, the Commission promotes a business friendly approach – underpinned by close collaboration with all stakeholders within its regulatory supervision.

For more information on Financial Services Commission, please visit http://www.fscmauritius.org/

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