TJN: UAE and Mauritius are the most Corrosive Corporate Tax Havens against African Countries

The Corporate Tax Haven Index (CTHI) by Tax Justice Network launched yesterday shows how the United Arab Emirates (UAE) and Mauritius are among the most corrosive corporate tax havens against African countries.

KPMG ConsumerCurrents Issue 25

Pernod Ricard: Pernod Ricard Chairman and CEO Alexandre Ricard on being obsessed about customers

Platform businesses: How platform models across the globe are transforming the way we shop

Sin taxes: Public health concerns are encouraging growth in taxes on our ‘vices’. But do these levies actually change behavior?

Product launches: Why innovation should be a predictable process

Case study: Will a new hotel in Detroit help upscale goods company Shinola offer consumers a complete brand experience?

Counterfeit products: How to combat the global scourge of fake food

Lessons from other industries: What the video game industry can teach you about user experience

ESAAMLG: FUR MAURITIUS- APRIL 2019.

This report sets out Mauritius' progress in strengthening anti-money laundering and counter terrorist financing measures since their 2018 assessment. Since its 2018 mutual evaluation, Mauritius has made progress in addressing deficiencies; the ESAAMLG has re-rated the country on 11 of the 40 Recommendations.

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Bombay High Court adds to Uncertainty Surrounding Mauritius Treaty Benefits

A recent Bombay High Court ruling unsettles the widely accepted position that the existence of a valid Tax Residency Certificate would be sufficient for a Mauritius based seller to claim treaty benefits for capital gains arising from the sale of investments acquired on or before 31 March 2017.

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P3 Audit Report Mauritius

P3 communications GmbH tested and measured the performance of its voice and data services on smartphones in comparison to other LTE/UMTS/GSM mobile radio networks in metropolitan and rural areas of Mauritius. 

The audit was done as a performance benchmark performed by P3 communications between 07.03.2019 and 16.03.2019 in cities and towns as well as on connection roads. 

Dedicated measurements have been executed as drive tests outdoors using a Samsung Galaxy S8 cat16 Smartphone 1000 Mbit/s Download / 105 Mbit/s Upload. 

All data measurements have been performed in 4G preferred mode. Voice measurements have been done in 4G/4G preferred mode on both sides, while call origin has been alternated.

the Wolfsberg Group: Guidance on Customer Tax Evasion

The Wolfsberg Group is pleased to publish its Guidance on Customer Tax Evasion, which is designed to provide Financial Institutions (FIs) with an industry perspective on how to develop, implement and maintain an effective anti-tax evasion compliance programme. The overall objective of the Guidance is to promote a culture of ethical business practices and compliance with legal and regulatory requirements related to the prevention of tax evasion, including the facilitation thereof, and to help FIs prevent the use of their operations for criminal purposes. It is the Group’s view that an effective compliance programme should leverage existing financial crime compliance, conduct and tax (including tax transparency regimes) procedures and controls, in order to address the risks of customer tax evasion, and the facilitation thereof.

The Group acknowledges that while tax evasion facilitation risk is distinct from the underlying predicate offence (i.e. not governed by money laundering regulations), Anti Money Laundering (AML) controls and procedures play an important role in the identification of tax evasion facilitation and it may, therefore, be fitting to consider both in tandem. This publication should be read in conjunction with applicable guidance issued by authorities in jurisdictions where an FI conducts business.

As FIs operate under a wide range of legal and regulatory environments, and have differing risk appetites and business structures, this Guidance should not be read as recommending a mandatory approach for all elements contained herein. There are a number of ways FIs can seek to adhere to the various documents published by the Wolfsberg Group. However, the means by which each FI choses to adopt these documents must make sense for each individual firm, recognising that one size doesn't fit all and that each FI's risk mitigation strategy must be tailored to meet its risk appetite.

AMLCop, the World's Most Advanced Anti-Money Laundering Service

AMLCop offers an advanced anti-money laundering software solution to streamline the verification of user details against a proprietary database of global sanctions, Politically Exposed Persons (PEPs), and watchlists.

SRA: A thematic review of trust and company service providers

Money laundering is not a victimless crime. It is used to fund terrorists and facilitates drug dealers and people traffickers, as well as a range of other criminal activity. The credibility of solicitors and the services they offer makes them an attractive target for criminals, who want to launder their gains. Solicitors have a vital role - and opportunity - to help tackle the problem.

The creation and administration of trusts and companies on behalf of clients has been highlighted by the government as one of the legal service areas at highest risk of exploitation by criminals. We agree with this assessment and it is reflected in our sectoral risk assessment. We have produced this document to set out information on money laundering and terrorist financing risks that we consider relevant to those we supervise.

Trusts and companies are attractive to money launderers because individuals can:

• obscure the beneficial ownership and control of assets and wealth
• create and control multiple legal entities at a relatively low cost
• create complex and opaque structures
• operate across multiple jurisdictions
• avoid tax or duties.

They are the vehicle of choice for the legitimate investment and business world, however criminals may use them to add a veneer of legitimacy to illegal transactions.

The government is committed to disrupting and stopping money launderers and continuing to develop anti-money laundering (AML) and counter terrorist financing (CTF) requirements to monitor, assess and mitigate the risks posed by these vehicles.

Raconteur: Artificial Intelligence for Business 2019

Will computers ever see the world like us? What if machines could teach themselves? And what new jobs will be available to humans once the mundane has been automated? The Artificial Intelligence for Business special report tackles all these questions and more. It explores the real value artificial intelligence (AI) can bring if business leaders can look beyond the hype, the ways in which AI is being used for social good and the ways in which it is learning to mimic human creativity. Also featured is comment on how the c-suite must take responsibility for educating themselves and providing proper AI training and an infographic examining which countries are really driving innovation in this area.

Mauritius: FSC Consultation Paper on administrative penalties

Section 7 (1) (c) (v) of the FSA relates to the power of the Commission to impose administrative penalties (“APs”) on licensees as an administrative sanction. To ensure appropriate use of this power, the Commission intends to establish a framework based on which it will impose APs for breaches of legislation as well as Rules, Regulations and Guidelines made thereunder including Licensing Conditions. APs will thus complement the existing panoply of administrative sanctions available to the Commission.

This Consultation Paper (“CP”) sets out the proposed approach to be taken by the Commission in relation to APs.

KPMG India Tax Flash News: Indostar Capital v. ACIT (Writ Petition No. 3296 of 2018)

The Bombay High Court quashes tax officer’s order denying nil withholding tax certificate in respect of capital gains under the India-Mauritius tax treaty - Indostar Capital v. ACIT (Writ Petition No. 3296 of 2018)

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FSC Mauritius issues Consultation Paper on Global Shared Services

The Financial Services Commission, Mauritius is issuing this consultation paper on the introduction of a regulatory framework for Global Shared Services and invites comments from industry participants and the public on the framework of this new business activity.

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IMF Staff Report for the 2019 Article IV Consultation: Mauritius

Mauritius is pursuing an ambitious strategy—centered around upgrading the infrastructure, promoting diversification, and spurring private investment—to foster inclusive growth and reach the high-income country milestone. Several structural challenges, notably, a shortage of suitably skilled workers, an aging population, and declining productivity and cost competitiveness confront Mauritius in meeting these goals. Moreover, speedy compliance with international anti-tax avoidance initiatives and AML/CFT standards is necessary to remain an attractive investment destination. Notable efforts are underway to address these challenges.

Country Report No. 19/108

Country Report No. 19/109

McKinsey: Confronting the risks of artificial intelligence

With great power comes great responsibility. Organizations can mitigate the risks of applying artificial intelligence and advanced analytics by embracing three principles.

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Raconteur: Future Workplace 2019

What does the future workplace look like? Without having reached a complete consensus, experts believe it will be smarter, greener and more efficient. The Future Workplace special report explores the benefits of a biophilic office, the need for dedicated learning spaces, and how setting up shop in a tech hub can give your startup a leg up. It covers how to tackle freelancer isolation and asks whether, in the era of messaging and collaboration apps, the desk phone is dead. Also featured is comment on how innovative tech can improve the life of the workforce and an infographic on how we can learn to work better together, in a time where we have five generations in the workforce.

EDB Mauritius: New ESAAMLG report underlines Mauritius’ full compliance to FATF recommendations

Mauritius continues to be a compliant, secure and safe business and investment destination, as highlighted by the ESAAMLG’s (Eastern and Southern Africa Anti-Money Laundering Group) latest mutual evaluation report.

In the document, Mauritius is shown as being largely compliant with respect to the 40 recommendations of the Financial Action Task Force. Commenting on the report, Minister of Financial Services and Good Governance Sudhir Sesungkur stressed the fact that Mauritius remains one of the safest and most transparent jurisdictions in the world:

“Mauritius has yet again proved that it is agile and able to adapt to more stringent regulations, and continues to actively participate in a new wave of healthy and constructive investment environment.”

In September 2018, the ESAAMLG mutual evaluation report on Mauritius, while highlighting the fact that the country was mostly compliant with the 40 recommendations of the FATF, called for an improved mechanism in 12 specific areas defined by the international authority. Since then, the Ministry of Financial Services and Good Governance as well as all relevant regulatory and enforcement authorities, worked towards an improved compliance to the FATF recommendations.

Prior to the September 2018 report, Mauritius reassessed its legal arsenal and brought a number of amendments to the Anti-Money Laundering / Combatting the Financing of Terrorism (AML/CFT) framework in the Finance (Miscellaneous Provisions) Act 2008. In addition to this, the Financial Intelligence and Anti-Money Laundering Regulations 2018 have been promulgated to address the requirements of the FATF.

“The efforts made by Mauritius to improve its level of commitment towards the international movement to combat money laundering and illicit flows has been lauded by international bodies, including the Council of Ministers of the ESAAMLG. The April 2019 mutual evaluation report can be deemed as yet another testament to our ongoing pursuit to comply with international standards. We have clearly stated our vision to make the Mauritius International Financial Centre one of the main pillars of economic growth and to achieve this, we cannot jeopardise our reputation as a secure, safe, transparent destination that is fully compliant with international standards and regulations,” says Minister of Financial Services and Good Governance Sudhir Sesungkur.

Following the changes made in the legislative framework, Mauritius has submitted to the ESAAMLG secretariat a first application for a technical compliance rerating on 12 recommendations, among which 10 have been successfully upgraded from Non-Compliant or Partially Compliant to Largely Compliant and one from Non-Compliant to Partially Compliant. Thus, the country’s rating, as per the norms and standards of the FATF, has been successfully upgraded from Non-Compliant to Largely Compliant. Meanwhile, Mauritian authorities have applied for the technical compliance rerating of other FATF recommendations which will be considered at the ESAAMLG meeting scheduled for September 2019.

“This upgrade in the technical compliance ratings clearly demonstrates that Mauritius as International Financial Centre of repute and substance, continuously reinforces its legislative mechanisms to give more comfort to the international investing community and stakeholders in both the banking and the non-banking sectors. I am also pleased to report that the ESAAMLG Secretariat acknowledges the significant efforts and progress made by Mauritius in addressing the technical compliance issues,” adds Minister Sesungkur.

About ESAAMLG

The purpose of the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLG) is to combat money laundering by implementing the FATF recommendations. This effort includes coordinating with other international organisations concerned with combating money laundering, studying emerging regional typologies, developing institutional and human resource capacities to deal with these issues, and co-ordinating technical assistance where necessary. ESAAMLG enables regional factors to be taken into account in the implementation of anti-money laundering measures.

ESAAMLG was launched at a meeting of Ministers and high-level representatives in Tanzania in August 1999. A memorandum of understanding (MoU) based on the experience of the FATF and other FATFstyle regional bodies was agreed to at that meeting. Following the signature of the MoU by seven of the potential members, including Mauritius, ESAAMLG came into formal existence. All members are Commonwealth countries which have committed to the FATF Forty Recommendations. The group held its first meeting on 17-19 April 2000 in Dar es Salaam, Tanzania. Following the events of 11 September 2001, ESAAMLG expanded its scope to include the countering of terrorist financing.

ESAAMLG members participate in a self-assessment process to assess their progress in implementing the FATF Forty Recommendations. ESAAMLG became an Associate Member of the FATF in June 2010.

18th April 2019.

Mauritius: Employment Of Non-Citizens (Spouses)

The Non-Citizens (Employment Restriction) Exemptions Regulations had been amended on 21 and 28 March 2019 respectively to the effect that foreigners who were married to Mauritian citizens would have had to apply for a permit should they have been working or intended to work in Mauritius.

Further to representations made, the amendments published on 28 March 2019 through GN 55 of 2019 have now been repealed and have been replaced by amendments of GN 68 of 2019, effective as of 15 April 2019. Accordingly, non-citizens referred to in Paragraph 1 who were working prior to the 8th March 2019 will continue to be exempted from the requirements of a permit.

However, an employer who, with effect from or any time after 8 March 2019, has in his employment a non-citizen who is either spouse of a citizen of Mauritius and/or, until remarriage, a surviving spouse of a citizen of Mauritius, may, for a period of 3 months after the coming into operation of these regulations, have the non-citizen in his employment without there being in force a permit in respect of the non-citizen. The employer of the non-citizen who intends to continue to have the non-citizen in his employment must, within a period of 3 months after the coming into operation of these regulations, apply and obtain a permit in respect of the non-citizen under the Non-Citizens (Employment Restriction) (Work Permit) Regulations 2017.

The Guidelines for application will be available shortly for consultation at empment.labour.govmu.org

For any query or additional information, the Ministry may be reached on phone number 4050132.

Ministry of Labour, IR, Employment and Training

17 April 2019

When is a tax treaty not a treaty?

The High Court of Kenya gave judgement on 15 March 2019 on a challenge to the validity of the Kenyan-Mauritius double tax treaty in Tax Justice Network- Africa v Kenya Revenue Authority and others.  The petitioners had sought a declaration that the treaty had not been subjected to the ratification of domestic law and the Kenyan constitution and the legal notice giving the treaty effect under Kenyan law was invalid. The case raises three distinct issues in treaty making...

Kluwer International Tax Blog

Raconteur: The Business Transformation 2019

Transformation can no longer be seen as a one-off project, for organisations to survive, it must become the new normal. The Business Transformation report, published in The Times explores why this requires a sea-change in both managerial mindset and company culture. Taking the lead from startups, businesses must embrace agility, introduce “teamship” training to their programme and be sure to select the right leaders to oversee change. Also covered is a case study on how a small smelting firm transformed their business model to become a cutting-edge urban miner, and an infographic with key cultural pointers to watch out for during digital transformation.

FSC Mauritius: Guidance Note on Securities Token Offerings

This Guidance Note, the second in the Fintech Series, issued under section 7(1)(a) of the Financial Services Act 2007, highlights the regulatory approach of the FSC in relation to STOs.

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