31 July 2015

Mismatch between local employability and imported labour Recommendations submitted

The High Level Ministerial Committee set up under the Chairmanship of the Acting Prime Minister, Minister of Tourism and External Communications, Mr. Xavier Duval, to address the mismatch between local employability and imported labour has submitted its recommendations to the Government. The Committee has examined, among others, the unemployment situation, the increasing number of qualified unemployed, and the lack of manpower planning.

The Committee has recommended, among others, that specific sectors, such as ICT, financial and insurance, and manufacturing, should be encouraged to attract foreign skills, know-how and talents in order to give a boost to the sectors. It has also recommended that an appropriate policy should be devised to encourage the employment of expatriates in scarcity and priority fields whilst leaving areas of low skills, or where sufficient trained labour is available, to citizens of Mauritius.

According to the Committee scarcity areas and parameters for both work permits and occupation permits should be reviewed, in particular in the tourism and construction sectors. Furthermore, it has also recommended that a data bank of masons and other relevant jobs in the construction sector should be set up whereby the unemployed can register with the Ministry of  Labour, Industrial Relations, Employment and Training, and be eligible for appropriate training.

It also recommends that the criteria for the issue of occupation permit should be revised and the minimum salary reviewed. It further recommends that fairness and transparency should be instilled in the process adopted for the employment of foreign workers in order to create opportunities for local job seekers.

New training institutions for capacity building in the cruise and nursing Sectors should be opened, and the private sector encouraged to provide relevant training are amongst the other recommendations made by the Committee.

Mauritius introduces new form for tax residency with more disclosure

The Financial Services Commission (FSC) of Mauritius, which is the regulatory body for the Mauritian non-banking financial services sector, has introduced a new application form for obtaining a tax residency certificate (TRC). 

30 July 2015

Why do offshore tax havens still exist?

Described by the former British cabinet minister Vince Cable as "sunny places for shady people", tax havens are much maligned.


It's thought the total sum hidden away in low-tax, low-regulation jurisdictions around the world could be $21tn (£13.5tn) - as much as the total annual economic output of the United States and Japan combined.

Barack Obama and other world leaders have vowed to crack down on tax havens. The Organisation for Economic Cooperation and Development (OECD) has pressed for greater transparency about how they operate. The European Commission has called for greater information-sharing about tax deals by EU national governments.

Four experts talk to the BBC World Service Inquiry programme about why, despite this growing opposition, tax havens continue to prosper.

Optionality key for managers as Jersey gets AIFMD passport recommendation from ESMA

Recognition for Jersey’s regulatory framework for alternative funds and the recommendation that the jurisdiction should enjoy future access to a Europe-wide passport under the EU Alternative Investment Fund Managers Directive (AIFMD) has been welcomed by Jersey Finance and the Jersey Funds Association.

The European Securities and Markets Authority (ESMA) recommended this week (30 July) that Jersey should be included in the first wave of ‘third non-EU countries’ whose managers can seek authorisation for a passport to market their alternative investment funds (AIF)  to professional investors throughout EU Member States.

The announcement means that, should ESMA’s recommendation be approved by the EU Commission, Parliament and Council, Jersey will be able to offer a broad range of marketing and organisational options to fund managers, whether they are targeting European or global investors.

Meanwhile, Jersey’s current marketing route into Europe via national private placement regimes looks likely to remain in place until at least 2018. This route, which only requires adherence to AIFMD reporting and disclosure requirements, continues to prove popular, with the number of Jersey funds marketing into Europe in this way recently breaking through the 200 barrier.  According to latest figures from the Jersey Financial Services Commission (JFSC), 84 fund managers have now received private placement authorisation, up 40% compared to December 2014, and 205 Jersey funds are now being marketed into Europe through private placement regimes, an increase of 10% over the past six months. Jersey managers and funds not actively marketing into Europe are not subject to any AIFMD regulation.

The news from ESMA follows a stellar annual performance for Jersey’s funds industry. Analysis carried out as at December 2014 showed the net asset value of regulated funds under administration in Jersey to have grown by around a fifth year-on-year to reach just over £228.9bn, the highest figure in seven years. Real estate funds business grew by 32% annually, private equity maintained a steady yearly increase of 5% and the value of hedge fund business grew by 46% year-on-year.

Geoff Cook, Chief Executive, Jersey Finance, commented:

Jersey’s private placement route into Europe continues to be actively used, with AIFMD not appearing to have stymied fundraising activities for Jersey funds at all. Nevertheless, this announcement from ESMA is a ringing endorsement of Jersey’s alternative fund regulatory framework and reinforces just how important it was for Jersey to become the first offshore jurisdiction to offer an opt-in AIFMD-compliant regime back in 2013. Overall, this announcement opens up considerable options to managers so that, whatever their strategy and target markets, they can rely on Jersey as a hub from which to offer highly flexible routes to investors in Europe and beyond.

Ben Robins, Chairman, Jersey Funds Association, added:

This is a fantastic development for Jersey that could position it right at the forefront of domiciles serving the global funds industry and particularly underlines its role as a specialist centre for alternative funds benefitting European investors. Managers have long appreciated Jersey’s security and stability and its dedicated "Anglo Saxon" approach to client service as a high quality, rather than high volume, jurisdiction. ESMA’s announcement confirms the appealing optionality of our platform and reinforces why managers continue to have confidence in Jersey's appropriately flexible regime for alternative funds business.

India - Mauritius & P-notes: Any proposed change in rules may spook Dalal Street

Just as every new government fiddles around with high school history text books, it also dabbles in Mauritius and P-notes. Both actions have a sharp, short-lived impact, leaving behind a trail of conspiracy theories. 


29 July 2015

FSC Mauritius: The Private Pension Schemes (Auditor and Actuary) Rules 2015

The Private Pension Schemes (Auditor and Actuary) Rules 2015 were gazetted on 25 July 2015. The Private Pension Schemes (Auditor and Actuary) Rules 2015 (“Auditor and Actuary Rules”) are the 8th FSC Rules issued under the Private Pension Schemes Act since its proclamation on the 01 November 2012.

The Auditor and Actuary Rules have been drafted following on-going consultation with local industry representatives (including qualified actuaries and auditors) and are based on the relevant international standards, practices and principles.

The aims of these Rules are to:
  • ensure that an auditor or actuary appointed by a private pension scheme or by the Financial Services Commission (the “Commission”) satisfies certain qualifications and experience;
  • provide for the appointment of an auditor or actuary by a private pension scheme or by the Commission;
  • provide for the resignation or termination of appointment of an auditor or actuary of a private pension scheme;
  • enumerate the powers and duties of an auditor or actuary in relation to private pension schemes; and
  • provide for reporting obligations of an auditor or actuary to the Commission on the financial affairs of private pension schemes.
The underlying principles of the Auditor and Actuary Rules are as follows:
  • an actuary or auditor of a private pension scheme should be suitably qualified and experienced in order to look into the financial affairs of the scheme and hence report on same to the Commission;
  • an actuary or auditor should provide professional services to private pension schemes in accordance with a well-established policy framework;
  • the duties, functions and responsibilities of an actuary or auditor of a private pension scheme should be clearly provided for; and
  • the circumstances under which the Commission may require an auditor to perform additional duties to be clearly provided.
Financial Services Commission, Mauritius
29 July 2015

28 July 2015

New report finds that a public­-private cyber-catastrophe reinsurance scheme would support UK cyber prosperity while adding clarity and certainty in the insurance market

Today, Z/Yen Group Limited publishes a new Long Finance report titled "Promoting UK Cyber Prosperity: Public-­Private Cyber­-Catastrophe Reinsurance". In the face of rapidly growing cyber­risk, the tools of insurance, i.e. risk management and shared learning, need to be rapidly grown and deployed. If society wishes to bring insurance to bear on helping to manage cyber-­risk, then cyber­-catastrophe reinsurance needs to be available for property damage, business interruption, and third party liabilities in order to remove blockages to rapid take­-up of cyber insurance by businesses.
The report analyses the nature and evidence of cyber-­risks, with a focus on cyber­catastrophe events. The report explores how a public-­private cyber-catastrophe reinsurance scheme could help secure ICT-­based prosperity in the UK by helping insurers insure themselves to insure others. The scheme would provide cover to a group of insurers above a catastrophic loss threshold, in effect a pool funded by the insurance industry. The UK government's role would be one of promotion and (possibly) a last resort insurer only in the event that industry retentions and the scheme's reserves have been exhausted. In all likelihood, the UK government would be a last resort insurer anyway but in this way it would benefit from a buffer much deeper than the one it enjoys today.

Key recommendations:
  • the scheme should provide more standardised wordings linking cyber-catastrophe to the policies members write, and more standardised data collection for analytical purposes;
  • the scheme should promote the use and evolution through learning of ICT security and risk management standards such as Cyber Essentials, ISO 27000, NIST, or CESG's 10 Steps;
  • insurance regulators should strongly encourage membership by insurers providing cyber cover;
  • members should jointly seek reinsurance for a cyber-­catastrophe, including consideration of cyber-­catastrophe linked securities; 
  • government should facilitate, but not underwrite, the scheme's reinsurance - government oversight could help the issuance of cyber-catastrophe linked bonds;
  • government and regulators should strongly encourage cyber insurance for essential services and critical national infrastructure including financial services, and incorporate cyber insurance in government procurement processes, e.g. requirement to purchase if unable to show appropriate management or retentions.
Richard Pharro, CEO at APM Group said: We are now dependent on electronic networks which define our economy, infrastructure and day-to­-day lives. The issue of cyber­security is fast moving towards a high stakes game for everyone, so it is entirely appropriate that we take robust steps towards putting the UK on a secure cyber footing. It is with everyone's prosperity and safety in mind that a public­private reinsurance scheme be considered to add certainty to UK plc cyber resilience. Whilst providing support for our economy against future threats an initiative such as this would raise general awareness about cyber security in the Board room.

Commissioner Adrian Leppard, the UK national policing lead for Fraud and Cyber said: Cyber insurance has a vital role to play in helping to keep society safe from the growing threat we are facing. Traditional enforcement methods have limited impact in this area and better standards for information security endorsed through comprehensive insurance models are an important means of creating a safer world for our communities.

Professor Michael Mainelli, Executive Chairman of Z/Yen and a co­author said: Historically, insurance has taught society how to handle risks from fire to workplace safety, road accidents, and life itself. To increase the rate of learning about cyber risk, society needs to increase the rate of cyber cover. A publicc-private cyber reinsurance scheme should be measured on how rapidly it helps us learn how to deal with the cyber-threats to our economic prosperity.

Promoting UK Cyber Prosperity: Public-Private Cyber-Catastrophe Reinsurance

This Long Finance research project sought to explore how cyber-catastrophe reinsurance might help mitigate cyber-risk, establish some evidence of the appetite for such reinsurance, and examine how government might best provide support for the establishment of an efficient free market solution.
Co-sponsored by APM Group, the report explores the nature of cyber-risk and the role of cyber insurance and reinsurance as a risk mitigation tool with a focus on cyber-catastrophe events that is cyber events that could seriously affect the economy. The report explores how a public-private cyber-catastrophe reinsurance scheme could help secure ICT-based prosperity in the UK by helping insurers insure themselves to insure others. The scheme would provide cover to a group of insurers above a catastrophic loss threshold, in effect a pool funded by the insurance industry. The UK government’s role would be one of promotion and (possibly) a last resort insurer only in the event that industry retentions and the scheme’s reserves have been exhausted. In all likelihood, the UK government would be a last resort insurer anyway but in this was it would benefit from a buffer much deeper than the one it enjoys today.

Long Finance engaged key stakeholders including insurance experts and professionals (including existing cyber underwriters and specialist brokers), reinsurance professionals, other financial services firms (e.g. major exchanges or fintech firms), providers of cyber-protection services, law and accountancy firms and government through over 80 semi-structured interviews, a round-table and a webinar.

IFC Review: IFCs and Investing in Emerging Markets

Matthew Stocker, Olivaire Watler and Charlie Pywell examine the crucial role IFCs play in facilitating investment in emerging markets

IFC Review: The Offshore Dragon – the Increasing Popularity of IFCs in the PRC

Anthony Oakes identifies the reasons behind the popularity of IFCs in the People's Republic of China

27 July 2015

FSC Mauritius Consultation: New Category of Investment Adviser for Corporate Finance

The Financial Services Commission, Mauritius (the “Commission”) intends to introduce a new category of investment adviser namely Investment Adviser (Corporate Finance).

In this respect, the Commission is seeking views and comments from the industry and the public on the proposed amendments to be made to the relevant FSC Rules. The objective is to enlarge the scope of investment advisory services and to promote the development of the Capital Markets in Mauritius.

The views and comments received during the consultation exercise will be duly considered by the Commission.

Your views and comments should be submitted by email on consult2015@fscmauritius.org and must reach the Commission by Monday 03 August 2015.

24 July 2015

FSC Mauritius: Communique - Amendments to Rule 8(4) of the Financial Services (Consolidated Licensing and Fees) Rules 2008

With effect from 02 July 2015, the Financial Services (Consolidated Licensing and Fees) (Amendment) Rules 2015 have modified the system of levying charges for late payment of annual fees by licensees under Rule 8(4) of the Financial Services (Consolidated Licensing and Fees) Rules 2008 (the “Rules”).

Prior to the amendment, pursuant to Rule 8(4) of the Rules, any licensee, providing financial services, having failed to pay its annual fees by the 2nd July, was liable to an additional charge of 25% of its annual fees for the first month (July) and supplementary charges of 15% for each additional month (as from August) until the annual fees were settled.

These charges for late payment of annual fees, being uncapped, resulted into situations whereby licensees were required to pay, as charges for late payment of annual fees, multiple times the annual fee applicable to their respective licences.

Subsequent to the amendment, the system of levying charges for late payment of annual fees by licensees under Rule 8(4) of the Rules is now as follows:

i) A fixed charge of 25% of the annual fees if the licensee fails to pay its annual fees by the due date; and
ii) An additional charge of 1% of the annual fees for each additional month or part of month during which the fees remain unpaid.

This new system is fairer to licensees, in case of late payment of annual fees.

Financial Services Commission, Mauritius
24 July 2015


Pea shooters against cannon – Belvedere duo’s offensive pales against unravelling reality

After sensational disclosures in March around the Belvedere Ponzi scheme, the news flow has slowed. That is the nature of such things. Complicated financial scams take time to unravel. First the authorities step in to freeze the money raising operations. Then auditors are appointed to find out what happened to the money. And only then is retribution applied. It can take years.

23 July 2015

Mauritius: MRA FATCA - Extension

Following requests from various stakeholders, it has been decided to extend the due date for the transmission of FATCA information to the MRA for exchange with the US Internal Revenue Service to 31st August 2015.

Should you require any assistance on the matter, you may contact the FATCA Unit


Mauritius - Tourism Industry: Introduction of the Hotel Classification System

The Hotel Classification System will be implemented so as to consolidate the tourism industry with well-defined criteria for operational standards as announced in Government Programme 2015-2019.

The Classification System has adopted a customer-centric approach purporting to reinforce the image of Mauritius as a reliable and upmarket destination. The main objectives of the System are to facilitate the choice of potential guests and develop a service of high repute.

The System will also ensure a sense of place experience and create an environment for total visitors’ satisfaction and enhance customer satisfaction by providing adequate and accurate product information at the time of booking by the customer.

Furthermore Government has agreed to new operators being authorised to operate helicopter services in Mauritius with a view to developing the upmarket tourist segment for activities, such as airport transfers, over the water travel, medical evacuation, sightseeing tours, golf courses drop off and pick up, photo shooting, filming, emergency and rescue services.

FSC Mauritius Communique on Lancelot Global PCC and The Four Elements PCC

The Financial Services Commission, Mauritius (the “FSC Mauritius”) refers to the Public Notice issued on 20 March 2015 regarding the withdrawal of Authorisation to act as Collective Investment Schemes pursuant to Regulation 13 of the Securities (Collective Investment Schemes Act and Closed-End Funds) Regulations 2008 and the revocation of the Category 1 Global Business Licences pursuant to Section 74(5) of the Financial Services Act 2007 (the ‘FSA’) of the following Protected Cell Companies:

i. Lancelot Global PCC; and
ii. The Four Elements PCC (Together “the Companies”)

On 23 March 2015, in accordance with Section 48 (1) of the FSA and in the best interest of the investors, the FSC Mauritius appointed Messrs. Mushtaq Oosman FCA and Rajeev Basgeet ACA, both Partners at PricewaterhouseCoopers Ltd, as joint administrators in relation to the whole of the business of the Companies.

Following the completion of the assignment of the Joint Administrators the FSC Mauritius is now considering requests for:

(i) the transfer of cellular assets from a particular cell to another cell of a PCC or to another Company as provided under Section 15 of the Protected Cell Companies Act 1999 (the ‘PCC Act’); and/or
(ii) an administration order of a particular cell as per the provisions of the PCC Act.

Those charged with governance, typically with executive management of the cell are hereby required to contact the FSC Mauritius within 21 days from the date of this communiqué to decide on the future course of actions.

Financial Services Commission, Mauritius
23 July 2015

22 July 2015

India feared to close Mauritius tax “loophole”

A major Indian asset manager says it chose not to domicile one of its new funds in Mauritius because it fears the Indian government will change or annul its double taxation agreement with that country.

Plain speaking (and writing)

The legal profession is changing; embracing the use of modern technology, streamlining traditional processes and improving transparency to make services more user-friendly. These welcome developments are all intended to make legal services fit for the 21st Century. Why is it then that some lawyers insist on clinging on to archaic language?

FSC Mauritius: Public Notice - Suspension of Investment Dealer (Broker) Licence & Global Business Licence of Citygate Securities Limited

Notice is hereby given in accordance with Section 27 (1) and 74(6)(a) of the Financial Services Act 2007 (the ‘Act’) that the Investment Dealer (Broker) Licence and the Global Business Licence of CityGate Securities Limited (‘CSL’) have been suspended with immediate effect.

CSL has as registered address: CityGate Securities Limited, Belvedere Management Limited, 7A, 7th Floor, Ebene Mews, 57, Ebene Cyber City, Ebene.

The Financial Services Commission, Mauritius (the ‘Commission’) has taken this decision on the grounds that CSL has, inter alia, failed to comply with:

(i) the specific provisions provided under the Act;
(ii) the Code on the Prevention of Money Laundering and Terrorist Financing; and
(iii) the licensing conditions attached to its licences.

In accordance with Sections 27(5) and 74(3) of the Act, CSL shall cease to carry out the activities authorised under its licences. However, CSL remains subject to the obligations of a licensee and to the directions of the Commission until the suspension of the licences is cancelled.

Financial Services Commission, Mauritius
21 July 2015

Fiscalité - Traité Inde-Maurice: nouveau point de désaccord

Le nouveau traité de non-double imposition fiscale entre Maurice et l’Inde serait loin d’être une réalité. Le gouvernement aurait soulevé deux points supplémentaires auprès des autorités indiennes. Il ne reste plus qu’à attendre que l’Inde les tienne en considération.

21 July 2015

Moby Joins Save Our Monkeys Campaign

Internationally renowned musician and singer-songwriter Moby has joined the Cruelty Free International Save Our Monkeys campaign to end the cruel exploitation of the monkeys of Mauritius.

On learning of the paradise holiday island’s role in breeding and exporting monkeys to laboratories around the world, Moby stated:“Mauritius is famous for its beautiful landscapes and its blend of cultures, so I was shocked to discover the truth about this idyllic island’s horrific trade and export of monkeys for experiments. Please support Save Our Monkeys and call upon Mauritius to end this cruel trade. Monkeys deserve the right to a free and happy life too.

Mauritius is a popular holiday destination, yet few tourists who visit the island are aware of the suffering that is inflicted upon the country’s own monkey population. Hidden away from the sun, sea and sand of the holiday brochures lies a controversial industry that breeds and exports monkeys to laboratories around the world. Tens of thousands of monkeys are held in farms across the country, many of whom were captured from the wild and imprisoned in these farms for breeding. Denied their freedom in the lush foliage of their jungle homes, these monkeys spend their lives behind bars on concrete. Their offspring are exported overseas in small wooden crates as cargo on airlines, often on the same planes in which tourists travel.

The country is one of the world’s largest suppliers of monkeys for experiments. During 2014, 8,991 monkeys were exported to laboratories primarily in Europe and the USA. Yet, this trade is economically insignificant compared with tourism. Less than 2% of Mauritian export income involves monkeys, a small fraction of the tourism industry.

The mission of the Mauritius Ministry of Tourism is ‘to make of Mauritius the best island destination in the world’ and the department is working hard to boost the country’s image as a green or ethical holiday destination. To coincide with this, Cruelty Free International has released a series of eye-catching visuals.

The organisation has also launched a petition addressed to the Mauritius Minister of Tourism.



Seven lose jobs at Isle of Man business

Seven people are to be made redundant at the Ramsey office of corporate service provider OCRA (Isle of Man) Limited

IFC Review - Guernsey: Staying Ahead of the Game

Christopher Jones examines Guernsey has stayed ahead of the regulatory curve by enhancing its legislative framework

IFC Review: Bermuda's Statutory Hastings Bass - If I Could Turn Back Time...

Ashley Fife examines how Bermuda's statutory Hastings Bass is an important addition to Bermuda's attractive regime for restructuring trusts

IFC Review - Singapore: Enhancing Its Regulatory Controls Against Money Laundering and Terrorism Financing

Yeoh Lian Chuan and Kwok Shuhui consider how Singapore has addresed concerns over money laundering by strengthening its AML regulation

India: Government consults legal experts on allowing foreigners to directly invest in venture capital and PE funds

The government has sought the opinion of legal experts on allowing foreigners to directly invest in Indian venture capital (VC) and private equity (PE) funds. A direct access under the "automatic route" would quicken fund inflows, cut cost and do away with investment pooling vehicles in tax havens such as Mauritius. 

20 July 2015

Global Opportunity Index 2015 ranks Mauritius 1st in Sub-Saharan Africa; 31st globally

The small island nation of Mauritius continues to be one of the most economically successful and stable countries in Africa according to the Global Opportunity Index, which ranks the island first in Sub-Saharan Africa and 31st globally, as one of the economies that is most open to foreign investment, with the highest Ease of Doing Business score on the continent.

Appleby Successfully Enforces An English Judgment Before The Supreme Court Of Mauritius

Appleby successfully appeared for Dallah Albraka (Ireland) Ltd (Applicant) before the Supreme Court of Mauritius (Supreme Court) in the case of Dallah Albaraka (Ireland) Ltd v Pentasoft Technologies Limited and anor 2015 SCJ 168 (Dallah).

The case of Dallah concerned an application for the recognition and enforcement of an English judgment delivered on 13 July 2007 (English Judgment) in favour of the Applicant. The English Judgment was in the sum of USD$13.36m for damages plus GBP£47,512 as costs.

The Applicant brought proceedings before the Supreme Court by way of 'exequatur' based on Article 546 of the Mauritian Code of Civil Procedure. On 27 May 2015 the Supreme Court delivered judgment in favour of the Applicant (Mauritius Judgment) by which the English Judgment was made enforceable in Mauritius.

The Applicant is a company incorporated in the Isle of Man. It is the investment arm of the Dubai-based Dallah Albaraka Group, a prominent business enterprise in Saudi Arabia and the Middle East.

Commercial Impact of the Supreme Court Decision

The decision of the Supreme Court in Dallah augurs well for the future in four respects. The Dallah case not only dealt with the area of 'exequatur' but also provided clarity in respect of:
  • Concurrent proceedings;
  • The relevance of Mauritius as a jurisdiction where the Respondent is a foreign company;
  • The significance of a party labelled as 'Co-Respondent'; and
  • The status of law firms which are legal practitioners in their own right under the Mauritius Law Practitioners' Act.

L’ex-patron de la BAI Dawood Rawat publie ses mémoires

Dawood Rawat, l’ancien patron de la BAI, s’est reconverti. Après avoir brassé des millions grâce à ses différentes filiales, il joue désormais avec les mots. En effet, il publiera bientôt ses mémoires, un document dans lequel il retrace plusieurs étapes de sa vie.

Traité de non-double imposition avec l’Inde : L’accord signé annoncé par le ministre Badhain : une intox?

Le traité de non-double imposition entre l’Inde et Maurice, est-il conclu comme l’ont voulu faire croire certains ténors du gouvernement récemment ? Si l’on s’en tient à la dernière déclaration du ministre des Finances, diffusée sur les ondes d’une radio privée, on est bien loin d’un accord déjà conclu, signé et qui attendait la ratification du gouvernement indien comme annoncé en grande pompe par le ministre de la Bonne gouvernance, Roshi Bhadain.

19 July 2015

Amicus curiae: Indo-Mauritius DTAA

Mauritius’ former finance minister claims that his country has given up the right to tax capital gains. This has raised questions regarding the scope of the renegotiation of the India-Mauritius Double Tax Avoidance Treaty (DTAA). Watch what the experts think about Indo-Mauritius DTAA.

18 July 2015

The future of the City - A chance of showers

The grandees of the City are often accused of crying wolf, pretending that their industry is about to be devoured by taxes and regulation when in fact they are just trying to protect profits. In recent months, the same chorus that greeted Mr Taylor has joined a new crescendo, complaining of everything from a new tax surcharge on banks’ profits to London property, which is apparently too expensive even for finance types. Above all, the doom-mongers point to Britain’s prospective departure from the EU, the subject of a referendum to be held by the end of 2017. Are their concerns any more plausible this time?

17 July 2015

New Regulatory Compliance Platform for Bank of Mauritius to Be Unveiled At Fintellix CXO Briefing

After successfully enabling several prominent Indian banks to comply with the Indian Central Bank - the Reserve Bank of India's - ambitious Automated Data Flow (ADF) mandate, Fintellix - the India market leader for regulatory compliance, together with leading XBRL technology expert Iris and Port Louis based technology services provider Mausage, is now ready to help Mauritian banks comply with BOM's mandate.

The launch of the solution comes at a time when rapid change has become the new normal in regulatory compliance worldwide, including Mauritius. Form, content, format and calculation are being constantly changed by regulators to drive a stable financial ecosystem. Post the 2008 global crisis, regulators worldwide have begun adopting global standards for automating information exchange with banks and also to ensure that the banking ecosystem speaks a common language. Currently, BoM requires over 70 returns that the country's banks need to automate, the other requirement being that banks have to submit the returns in a prescribed format, i.e. XBRL.

Scheduled to be held at the Hilton Mauritius on July 24, the Fintellix CXO Briefing will demonstrate how Mauritius' banks can leverage a next generation platform to lay the foundation for future-proofing compliance with BOM. Together with XBRL technology expert Iris and Port Louis-based technology services provider Mausage, Fintellix will also share experiential insights on how existing data management investments can be leveraged to address current and upcoming local and global regulations such as Automated Data Flow (ADF), Risk-based Supervision (RBS), Liquidity Credit Ratio (LCR), FATCA, etc.

Deep-dive sessions will highlight BOM's XBRL Reporting requirements and the implications for banks, complexity and intricacies around ensuring compliance; solution options based on each bank's context, highlights of Fintellix Regulatory Compliance Platform and best practices for leveraging existing data infrastructure investments to address upcoming local & global regulations.

Fintellix has helped multiple prominent banks in ambitious ADF mandates by central banks. The Fintellix Compliance Suite is powered by Fintellix's next generation Data platform that is a singular, integrated and scalable Banking Data Management infrastructure which plugs into the Bank's internal and external data sources via pre-built 'adapters' and provisions raw Banking data for a variety of downstream uses such as Regulatory Reporting, Risk Management and Business Analytics.

With 40 per cent of India's Top 20 Private and Foreign Banks now using Fintellix for Regulatory Compliance initiatives, Fintellix provides solutions for all regulatory requirements on a single platform and Centralised Data Repository (CDR).

The firm's banking solutions are available for on-premise implementations as well as provisioning from a regional Cloud infrastructure. Fintellix is currently active in India, US, Europe, Middle-East, Africa and South East Asia.


Programme
2.45 - 3.00 PMRegistrations
3.00 - 3.15 PMWelcome and Introductions 
3.15 - 3.45 PMNavigating a Tough Regulatory Compliance TerrainK Balachandran, Co-Founder & Director, Iris Business Services 
The evolving Mauritian regulatory landscape and what lies ahead
Intricacies and nuances of BOM’s ADF/XBRL mandate and what it means for banks
Understanding the challenges of being ‘ADF/XBRL-ready’
3.45 - 4.15 PMBuilding a ‘Compliance-Proof’ Bank 
Vivek Subramanyam, CEO, Fintellix

Trials and tribulations of constant compliance
Functional benefits of an integrated ‘growth + compliance’ ecosystem
Going beyond ADF/XBRL towards RBS, LCR, FATCA, etc.
How the Fintellix ADF foundation is helping Indian banks stay ahead of the compliance curve
Leveraging an agile nextgen platform for future BOM mandates
4.15 - 4.30 PMTea / Coffee Break 
4.30 - 7.15 PM (with Tea/Coffee Break in Between)Fintellix’s Nextgen Banking Data Platform: A Deep-diveShivani Venkatesh, Senior Banking Technology Consultants, Fintellix Compliance Product Suite 
Live walkthrough of Fintellix flagship product
Component-wise demonstration of features and benefits vis-à-vis BOM’s ADF/XBRL requirements
Q&A
7.15 PM onwardsCocktails & Dinner

Mauritius: Mauritian Diaspora Scheme + Hotel Classification System

Cabinet has taken note of the setting up of the Mauritian Diaspora Scheme, designed to attract members of the Mauritian diaspora back to Mauritius and encourage their participation in the economic development of the country as announced in 2015-2016 Budget Speech.  Any member of the Mauritian diaspora, that is, a citizen of Mauritius holding a valid Mauritian passport, or a child or grand child of that citizen, who has been living and working outside Mauritius, has the necessary skills, talent and experience, and is willing to return and serve Mauritius, would be eligible to apply for registration under the Scheme. 
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Cabinet has agreed to the implementation of a Hotel Classification System in a bid to consolidate the tourism industry with well-defined criteria for operational standards as announced in Government Programme 2015-2019.  The Classification System has adopted a customer-centric approach purporting to reinforce the image of Mauritius as a reliable and upmarket destination. The main objectives of the System are to –
  1. facilitate the choice of potential guests;
  2. develop a service of high repute;
  3. ensure a sense of place experience and create an environment for total visitors’ satisfaction; and
  4. enhance customer satisfaction by providing adequate and accurate product information at the time of booking by the customer.

Mauritius: Revised Procedures for Recommendation of Tax Residence Certificate (TRC)

Following the amendments brought in Section 3 of Chapter 4 of the Guide to Global Business, the FSC is hereby amending its TRC Application Form to cater for the additional substance requirements and further streamlining its TRC application process. The new TRC application process will ensure smooth submission of TRC applications, processing, recommendations and notifications. The details are as follows:

  1. All applications for TRC by Category 1 Global Business Companies (“Applicants”) will continue to be made through the FSC for onward recommendation to the Mauritius Revenue Authority (“MRA”). 
  2. All new applications or applications for renewal of TRCs should be mandatorily made on the amended TRC Application Form with effect from 03 August 2015. To download a pdf version of the TRC Application Form, please click here
  3. The TRC Application Form should be filled in and signed by the resident directors of the Applicant and an [senior] officer of the Management Company in its capacity as Company Secretary. Thereafter, a scan copy of the TRC Application Form must be forwarded to the FSC by way of email to trc@fscmauritius.org. The original duly signed TRC Application Form should be preserved in the Applicant’s file and shall be available for inspection and whenever required. 
  4. By completing and submitting the TRC Application Form, the Applicant and the Management Company take responsibility for the completeness, accuracy and veracity of its contents. Management Companies are therefore advised to make necessary arrangements to ensure that the TRC Application Form has been properly filled in, approved by the Applicant and emailed to the FSC.
  5. The TRC Application Form contains a section – Part 2 – on “Additional Substance Requirements”. The Applicant is required to tick the relevant box(es), being the substance requirement(s) it is complying with. The FSC may also require an Applicant to demonstrate compliance with those substance requirements. 
  6. For a newly licensed Applicant (for which the first set of audited financial statements are not yet due), it will be assessed on its business plan and/or on information submitted by the Applicant on how it proposes to meet the substance requirements. The Applicant must tick the relevant box(es), being the substance requirement(s) which the Applicant proposes to comply with and which the FSC may subsequently verify, for example when the Applicant submits its first set of audited financial statements. The FSC may, at any time, require the Applicant to demonstrate how it proposes to comply with the substance requirements. 
  7. The Applicant will have to tick the relevant box(es), for the DTAA in relation to which the TRC has been applied for. The Applicant has the option to apply for a General TRC and/or a country-specific TRC. 
  8. In Part 3, both resident directors and the Company Secretary (being the Management Company) of the Applicant have to declare that the Applicant complies with the provisions of the prevailing legislation governing global business (including regulations and rules made thereunder), in particular the statutory provisions as laid down in section 71(4)(b) of the Financial Services Act 2007, adheres to the conditions attached to its licence, meets the substance requirements as specified in Part 2, and that they have not willfully omitted or concealed any information that ought to be disclosed to the FSC for the purpose of claiming benefit under the DTAAs. In the event any information submitted is found to be false, the directors of the Applicant and the Management Company may be liable to regulatory sanctions. 
  9. Please note that the FSC will not process TRC applications which are found to be inaccurate and incomplete and where the Applicant, upon a request from the FSC, has not complied/demonstrated compliance with any of the substance requirements. The FSC may also revoke its recommendation if at any time it becomes aware that the Applicant is not compliant with the substance requirements. 
  10. For ease of processing, Management Companies are required to insert the full licence number and the name of the Applicant in the “subject” field of the email. The format to be used is “Licence number - Name of Applicant”. 
  11. Upon receipt of the TRC application, same will be processed and if deemed to be compliant in all respects, the TRC application will be recommended, by way of email, to the MRA. The FSC will send a reply to the Management Company of the Applicant informing that the TRC has been recommended (or not recommended, as the case may be). Accordingly, the relevant Management Company can arrange with the MRA to settle its service fee(s) and collect the TRC. 
  12. Management Companies are requested to submit TRC applications for renewal at least 30 days prior to the expiry of the current TRC. 

Lastly, for a better understanding of the TRC procedures, the changes brought by the FSC to the TRC procedures should be read in conjunction with Circular Letters CL011006 and CL-II/220408, and the previously amended procedures as issued in March 2013. 

Financial Services Commission 
17 July 2015

FSC Mauritius issues Revised Procedures for Recommendation of TRC

Following the amendments brought in Section 3 of Chapter 4 of the Guide to Global Business, the FSC is hereby amending its TRC Application Form to cater for the additional substance requirements and further streamlining its TRC application process. The new TRC application process will ensure smooth submission of TRC applications, processing, recommendations and notifications.

The Financial Services Commission (the “FSC”) will recommend an application for Tax Residence Certificate (“TRC”) to the Mauritius Revenue Authority (“MRA”) which is complete in all respects.

The FSC may verify the information provided in the TRC Application Form and if anything is found to be false, the directors of the Applicant, being the Category 1 Global Business Company, and the Management Company will be liable for regulatory sanctions.

The option to apply for a country-specific TRC is not available for Egypt:



Wragge & Co: UK Summer Budget 2015 - new rules for non-doms

The UK Chancellor made his Summer Budget speech on 8 May 2015, the first of the new Conservative Government. 

Included in this were a number of measures of great significance to non-UK domiciled individuals, not least to those who own residential property in the UK or may acquire such property in the future. 

These measures include the following: 
  • Non-UK domiciled individuals with a domicile of origin outside the UK will be deemed to be domiciled in the UK for all tax purposes - income tax, capital gains tax (CGT) and inheritance tax (IHT) - after they have been resident for 15 out of the last 20 tax years;
  • Individuals with a UK domicile of origin will be unable to take advantage of a subsequently acquired foreign domicile at any time when they are UK resident, irrespective of the number of years they spend here; 
  • Non-UK domiciled individuals will no longer be able to shelter UK residential property from IHT by holding it through an offshore company or other offshore vehicle. This will apply to property held through companies owned by both individuals and trustees. 
In this update, Wragge Lawrence Graham & Co look at the new measures, which are due to take effect from 6 April 2017 following consultations to be published later in the summer, and consider the potential implications for non-UK domiciliaries, both resident and otherwise.

16 July 2015

Mauritius’ location positions it well as an African financial hub

Danae Kyriakopoulou, a Senior Economist at the Centre for Economics and Business Research in London, and an external Economic Adviser at the ICAEW spoke to AfricaMoney, commenting on the global economic condition for 2015-2016. She stated that the US will be the one of the brightest spots in the global economy in this year, and Mauritius is also expected to fare quite well. Mauritius boasts the highest score in the continent on global indices and its location provides a strategic advantage to the island economy for positioning itself as a financial hub for investments into Africa.

Shining a Light on Tax Avoidance in Africa

A UN conference in Ethiopia has agreed to reform global finance and use funds gained to boost development and fight poverty. We hear from the event in Addis Ababa and get the views of the Nobel Laureate economist Joseph Stiglitz, plus campaigners who want multi-national corporations to pay more tax in developing countries.

As Greece inches closer to a deal on its debt with the European Union and the country's banks are expected to reopen soon, we hear from Athens about continuing division over the agreement.

It has been a historic week for the world with the agreement to end the long running dispute over Iran's nuclear programme, but is all of America behind President Barack Obama, who is claiming credit for the deal? Economist Irwin Stelzer, from the Hudson Institute, provides insight from Washington DC.


India-Mauritius tax treaty: Protocol yet to be finalised

The comments of the former Finance Minister of Mauritius have sparked alarm regarding the tax treaty negotiations between India and Mauritius. The former FM Rama Sithanen says he's seen the new protocol and in it Mauritius has given up the right to tax capital gains. If this is true it would have a significant impact of foreign investors investing in India via Mauritius. 

The former FM's comments have raised doubts about whether treaty amendments include a Limitation of Benefits clause as well as a change in Article 13 - that takes away the Mauritius' right to tax capital gains. To clarify matters CNBC TV18's  Menaka Doshi talks to senior tax lawyer Nishith Desai, who is also acting as counsel to the Mauritius Government in these tax treaty re-negotiations.

Notification of the Management Buyout of Appleby’s Fiduciary Business

As a valued client of the Appleby Group, I am writing to let you know that we have agreed to a private equity-backed management buyout of our fiduciary business, which includes our Corporate Administration, Trust Administration and Fund Services businesses. This is an exciting development for our fiduciary business whereby it will become an independent entity, owned and managed by its management team. The team will be backed by a new shareholder, Bridgepoint, a leading pan-European private equity investor which has a broad portfolio of successful companies across a range of industries, including many in the business and financial sectors.

Both the management team and Bridgepoint are committed to ensuring the future success of the business, providing it with the resources and capital to extend the services we can offer to our clients. High levels of client service will remain at the heart of what we do and you will see no change in the service levels that we offer to you. Your relationship team will remain the same and will transfer to the new entity post completion and we are remaining at the same address in each of our locations.

The fiduciary business will also maintain a close and productive working relationship with the Appleby Law Firm, maintaining the benefits to our clients of the joined up approach enjoyed to date. So rest assured it is “business as usual” as far as your business with us is concerned. However, should you have any questions or concerns, please do not hesitate to get in touch with any member of your relationship team.

The deal will be subject to regulatory and legal approvals. Once these have been received, we will be launching a new brand name, reflecting our newly independent status. We will contact you in due course to provide further information on this.

We are genuinely excited by the opportunities this will bring in terms of the services and products we can offer to our clients and we look forward to continuing our relationship with you.

Farah Ballands
Partner | Global Practice Group Head | Fiduciary

Appleby Fiduciary & Administration to be acquired by Bridgepoint

Appleby Fiduciary & Administration Business (or ’AFB’), a global trust, corporate and fund services group, is to be backed by Bridgepoint in a primary management buyout from Appleby Group for an undisclosed sum.

The company is a multi-jurisdictional business which provides trust and corporate services to a wide range of clients across the globe, administering over 10,000 structures for almost 6000 clients from nine locations.  The business has three core service lines: Corporate Administration, Trust Administration and Fund Services.

In corporate administration, clients range from large multinational corporations from all sectors, to individual holding companies and SPVs established for holding investments such as real estate.  Trust administration involves AFB establishing trust structures and then providing day to day services such as acting as trustee, record keeping, assisting with succession planning. Clients include high net worth individuals, corporations and financial institutions. In fund services, AFB advises and assists in the launch and incorporation of funds. This can include fund accounting, valuations, secretarial services, regulatory and compliance services.

Farah Ballands, Chief Executive of AFB, said:

"This is a really exciting step for our business, and the management team is delighted that we will be partnering with Bridgepoint. With Bridgepoint's support and expertise in growing businesses successfully, we will be able to develop a greater range of products and services for our clients. The Appleby Group has provided us with a solid foundation and enabled us to grow to the size, reach and scale that we enjoy today, but now is the right time to accelerate our growth plans."

William Paul, partner and head of Bridgepoint's financial services team, said:

"AFB is an exciting platform with a reputation for high quality, client-centric services, and the expertise to deal with the complex needs of its clients. It brings significant opportunity as a standalone business to accelerate its growth organically and via acquisition, in what remains a strongly growing market."

Key attractions of the business include its favourable historic earnings growth, strong new business flows, the opportunity for expansion through selective acquisitions in a fragmented market, as well as AFB's leading positions in growing, niche areas such as employee benefit trusts in Jersey, the insurance market in Bermuda and collateralised loan obligations in the Cayman Islands.

Bridgepoint estimates that the global market for trust, corporate and fund services will grow at c.7% per annum, driven by increases in private wealth, foreign direct investment/trade flows and increasing regulation. 

This investment was made by Bridgepoint's €4 billion Bridgepoint Europe V buyout fund. Completion of the transaction is subject to certain conditions, including regulatory and legal approvals. Debt for the transaction was provided by: Bank of Ireland, ING, Société Générale and Unicredit.

Advisers involved in this transaction included:

For Bridgepoint:  KPMG / Wyvern Partners (Corporate Finance), Stikeman Elliott (Commercial / Regulation ), KPMG (Accounting, Tax/Structuring),  Intuitus (IT),  Marsh (Insurance), Travers Smith (legal).

For Appleby:  PWC (M&A, Commercial and Financial), Macfarlanes (legal), Kinetic (Compliance).

For Management:  Liberty Corporate Finance (M&A), Dickson Minto (legal), PwC (Tax).

Mauritius and Zambia sign investment protection pact

Mauritius and Zambia signed an Investment Promotion and Protection Agreement (IPPA) on Tuesday 14 July 2015 at the Government House in Port Louis. The Minister of Finance and Economic Development, Honourable Mr Vishnu Lutchmeenaraidoo, signed on behalf of the Mauritian side, whilst the Minister of Commerce, Trade and Industry of Zambia, Honourable Mrs. Margaret D. Mwanakatwe, signed for the Zambian side.

During his speech, Minister Lutchmeenaraidoo spoke about the vision of Mauritius to identify and explore new growth opportunities on the African continent as part of a robust South-South cooperation. The IPPA with Zambia the 21st such agreement Mauritius is signing with an African country. Africa is rising, and Mauritius endeavours to play an even more meaningful role in the African growth story. The Minister said that the Mauritian port is poised to play a defining role in the regional maritime trade in the light of the continent’s new economic configuration.

The new economy strategy of Mauritius shall rest predominantly on the three key pillars, namely deeper cooperation and integration with the African continent, the ocean economy and the port, according to the Minister of Finance and Economic Development.

With the new IPPA, Mauritius and Zambia will pursue broader and deeper economic cooperation. Mr Lutchmeenaraidoo proposed the setting up of a Joint Economic Commission between the two countries in view to speed up bilateral trade and investment exchanges as well as sharing of know-how.

A Double Taxation Avoidance Agreement (DTAA) between our two countries is in force since June 2012.

The Minister of Commerce, Trade and Industry of Zambia, Honourable Mrs. Margaret D. Mwanakatwe, considers the time is opportune for closer economic ties between our two countries.  “The opportunities are immense” she stated. “There is so much to learn from Mauritius in textiles and tourism”. Zambia, on the other hand, has a lot to offer in the area of agriculture.

GAAR provision to make way into India-Mauritius treaty

India and Mauritius are set to limit the benefits of their double tax avoidance agreement (DTAA) to only genuine businesses bringing foreign direct investment to India by inserting a new clause in the treaty straight from New Delhi’s yet to be implemented General Anti-Avoidance Rules (GAAR)

Financial Express

Tax pact with Mauritius to get GAAR-like teeth

India and Mauritius are set to limit the benefits of their double taxation avoidance agreement (DTAA) to only genuine businesses...

Financial Express

15 July 2015

Offshore : Profits nets de Rs 1,4 milliard pour les Management Companies

Incursion au sein d’un secteur au cœur de l’actualité avec la renégociation de la convention fiscale indo-mauricienne. Il s’agit de celui de l’offshore, communément appelé Global Business

BLC Banking & Finance Insights (July 2015): Apartes with Professor Philip R Wood CBE, QC (Hon)

The intricacies of taking security in crossborder and global transactions are the subject of ceaseless discussions both between practitioners and academics in many jurisdictions. In some instances debate has prompted extensive, and in others, limited reforms in this area. For a couple of years now Mauritius has been thinking of reforming the law applicable to secured transactions, which is founded in the Mauritius Code Civil and the Code de Commerce, themselves built on the Napoleonic codes.

In issuing a reform paper on Secured Transactions Reform in 2013, the Mauritius Law Reform Commission considered, amongst other things, the 2006 French Reform, the World Bank technical reports, the Article 9 of the American Uniform Commercial Code, Personal Property Acts, the 2007 United Nations Commission on International Trade Law (UNCITRAL) guide on secured transactions and the OHADA Acte Uniforme Révisé. 

However no amendment to the legislation is yet in the pipeline. The Mauritius Law Reform Commission’s 2013 paper was part of the discussions during the April 2015 seminar on the Droit du contrat et des suretes dans l’Ocean Indien organised by the Mauritius Institute for Judicial and Legal Studies under the aegis of l’Association Henri Capitant, the Centre de Recherche Juridique of Reunion Island and the French Institut de Recherche en Droit des Affaires.

We have asked Prof. Philip R Wood CBE, QC (Hon) his views on how the 2007 UNCITRAL Guide on Secured Transactions (UNCITRAL Guide) could assist in the modernisation of Mauritius secured transactions law.