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Asset Management Company company formation in Mauritius

Incorporating an Asset Management Company in Mauritius presents a lucrative opportunity for investors and entrepreneurs. The combination of a favorable tax regime, strategic geographic location, and a robust regulatory framework makes Mauritius an ideal jurisdiction for your asset management venture.

Asset Management Company

Company incorporation in Mauritius

Mauritius, with its strategic location and favorable business environment, has become a prime destination for establishing Asset Management Companies (AMCs).

What is an Asset Management Company?

An Asset Management Company (AMC) specializes in managing investments on behalf of clients, aiming to maximize returns and manage risks. These companies handle a wide range of assets, from securities to tangible and intangible assets, providing strategic investment planning and execution.

Advantages of Establishing an AMC in Mauritius

Mauritius offers a strategic location with a robust legal framework, making it an attractive destination for AMCs. The benefits include access to international markets, a skilled workforce, and a favorable tax regime, which collectively enhance the operational efficiency and global competitiveness of AMCs.

Taxation Benefits

  • Corporate Tax: AMCs enjoy a reduced net corporate tax rate, subject to meeting specific substance criteria.
  • Tax Exemptions: There are no withholding taxes on dividends, stamp duties, capital taxes, or inheritance taxes, fostering a tax-efficient structure for AMCs.

Other benefits

  • Strategic Location and International Access
    Mauritius serves as a gateway to Africa and Asia, offering AMCs unparalleled access to emerging and established markets. Its time zone facilitates business across continents, enhancing operational flexibility.
  • Robust Legal and Regulatory Framework
    Mauritius is renowned for its strong legal system and comprehensive regulatory framework, providing a secure and transparent environment for investment management activities.
  • Skilled Workforce
    The island boasts a highly educated and bilingual workforce, capable of servicing global clients and contributing to the sophisticated financial services sector.
  • Quality of Life
    Mauritius offers an exceptional quality of life, making it an attractive location for expatriates and professionals working in the AMC sector.

Operational Considerations

Setting up an AMC in Mauritius involves meticulous planning around administration, compliance, and the management of securities and other assets.

Administration and Compliance

  • Management and control must be established in Mauritius, requiring at least two local directors
  • Regular board meetings within the country to ensure governance and compliance with local laws
  • Appointment of qualified compliance officers to adhere to regulatory requirements

Securities and Investment Management

Asset Management Companies (AMCs) in Mauritius are equipped to manage an extensive array of financial instruments. This capability allows AMCs to offer their clients a wide variety of investment opportunities, tailored to meet diverse financial goals and risk tolerances. From traditional equity and debt instruments to more complex derivatives, AMCs leverage their expertise to optimize investment portfolios for maximum return and strategic asset allocation.

What are Securities?

Securities are tradable financial assets that represent an ownership position (as with stocks), a creditor relationship (as with bonds), or rights to ownership as represented by an option. They play a crucial role in the investment landscape, offering investors a means to achieve portfolio diversification, income generation, and capital appreciation. Securities are categorized broadly into equities, debts, and derivatives, each with its unique characteristics and risk-return profile. AMCs utilize these instruments to construct and manage investment portfolios, aiming to align with the financial objectives and risk tolerance of their clients.

Types of Securities Managed

  • Equity Securities: Shares or stocks representing ownership in a company, including those incorporated in Mauritius or abroad, but excluding collective investment schemes.
  • Debt Instruments: Debentures, bonds, loan stock, convertible bonds, and other instruments acknowledging indebtedness, offering regular income through interest payments.
  • Derivative Instruments: Rights, warrants, options, and interests in securities, alongside options, futures, forwards, and other derivatives on securities or commodities for hedging or speculative purposes.
  • Government and Public Securities: Treasury bills, bonds, and instruments issued or guaranteed by the Government of Mauritius, other national governments, local authorities, or public entities.
  • Collective Investment Schemes: Shares in, securities of, or rights to participate in collective investment schemes, allowing pooled investment by investors.
  • Depository Receipts: Instruments like American Depository Receipts (ADRs) or Global Depository Receipts (GDRs) that represent ownership in the shares of foreign companies.
  • Other Approved Securities: Any other transferable securities, interests, or assets approved by the Financial Services Commission (FSC), ensuring flexibility and innovation in investment offerings.

For asset types not explicitly mentioned, the FSC will consider on a case-by-case basis, highlighting the regulatory body’s commitment to accommodating a diverse range of investment products under AMC management.

Regulatory Framework and Licensing

To operate legally in Mauritius, AMCs must adhere to a sophisticated regulatory framework designed to ensure compliance with both local and international standards. This framework is governed by the Financial Services Commission (FSC), Mauritius’ integrated regulator for non-banking financial services and global business activities. The FSC’s rigorous oversight ensures that AMCs operate within a secure, transparent, and efficient market, contributing to the overall integrity and stability of Mauritius as a financial hub.

Licensing Requirements

Obtaining the appropriate licenses is a critical step for AMCs aiming to manage assets and offer investment services. The licensing process is designed to assess the capability, integrity, and financial stability of prospective AMCs, ensuring that they meet the high standards set by the FSC.

  • Asset Manager License: This is a prerequisite for firms intending to manage portfolios of securities and other assets on behalf of clients. It permits AMCs to engage in a broad range of activities, including but not limited to the management of portfolios in accordance with mandates given by investors.
  • Global Business Company (GBC) License: Essential for AMCs that plan to conduct business internationally and seek the advantageous tax regime Mauritius offers. A GBC License allows companies to benefit from Mauritius’ network of double taxation avoidance agreements, provided they conduct their core income-generating activities within the country and meet substance requirements.

Required Documentation

Prospective Asset Management Companies (AMCs) aiming to incorporate and operate in Mauritius must prepare a comprehensive set of documents for submission to the Mauritius Financial Services Commission (FSC). The list below provides a detailed overview of commonly required documentation.

However, it is important to note that:

  • The specific nature and scope of your AMC’s proposed activities may influence the exact documents required
  • Regulatory requirements are subject to change. The FSC may update documentation requirements in response to new regulations or financial market conditions
  • Applications are evaluated on a case-by-case basis, potentially leading to variations in the required documentation for different AMCs

With these considerations in mind, the following list offers a comprehensive starting point for gathering the necessary documentation for AMC incorporation in Mauritius:

  • Duly dated and signed Application Forms, along with prescribed processing and/or annual fees, detailing the fee structure and core business activities aligned with the Permitted Activities.
  • A detailed Business Plan, including:
    • Introduction and background of the company
    • Business objectives, strategies, and proposed activities
    • Organisational structure with an Organisation Chart
    • Target markets and client profiles
    • Modes of financing
    • Three-year financial forecasts (Balance Sheet, Profit and Loss Account, and Cash Flow Statement)
    • Any other relevant information to support the application
  • Comprehensive CVs of all senior officers, along with Personal Questionnaire Forms for Directors, Managing Director/CEO, Compliance Officer, MLRO (Money Laundering Reporting Officer), and Deputy MLRO, as applicable.
  • Proof of Compliance with Anti-Money Laundering (AML) and Counter-Financing of Terrorism (CFT) regulations, including a commitment to implement a manual of internal controls and compliance procedures upon licensing.
  • Certified true copies of the Certificate of Registration/Incorporation, Constitution/Memorandum & Articles of Association (if any), Trust Deed, and other statutory documents required for the registration/incorporation of the Applicant.
  • Details of any other licenses or registrations held by the Applicant, if applicable.
  • Evidence of professional indemnity insurance coverage, with costs for indemnity coverage varying depending on the covered limit.
  • Copies of material contracts/agreements to be entered into with banks, other asset managers, liquidity providers, brokers for share dealing, etc.
  • Plans for infrastructure, security, and the safekeeping of securities/assets, alongside measures to ensure the confidentiality, security, and reliability of client information.
  • Copies of promotional materials to be used in connection with the AMC’s business activities.
  • Confirmation of an effective complaints handling process to be maintained in the conduct of its business.
  • Evidence of the source of capital/funds contributed (e.g., account statement).
  • Potentially, morality certificates for directors, shareholders, and officers, to affirm good standing and compliance with ethical standards.

This extensive list of required documents ensures that AMCs are fully prepared to meet the FSC’s stringent requirements, demonstrating their operational integrity, financial stability, and commitment to compliance and best practices in asset management.

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For more information on establishing an Asset Management Company in Mauritius, contact our team of experts. We provide end-to-end consultancy and incorporation services to streamline your entry into Mauritius’s dynamic financial sector.

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