Pravind Kumar Jugnauth, Prime Minister and the Minister of Finance and Economic Development, during his 2018/2019 Budget Speech in June of 2018, announced the Global Business sector's reforms to be brought in Mauritius.
These reforms came into force in October 2018 and are currently in favor of the investors seeking to set foot in the Mauritius business sector.
A major overhaul was done to the concept of Global Business Corporation (GBC). With many simultaneous changes in multiple legislation that regulate Mauritius's business affairs, some new and improved enhancements are to be noticed.
Mauritius Finance (Miscellaneous Provisions) Act 2018 (Finance Act) saw the removal of Global Business Category 1 and 2 (GBC1, GBC2) business licenses. GBC1 has been renamed to GBC, and GBC2 has been replaced by a new Authorized Company (AC) concept.
What is an Authorised Company in Mauritius?
Mauritius is already a well-known location for offshore purposes. Having a strong banking and business sector makes Mauritius a preferred choice to set up a company.
Mauritius is a tax haven and provides multiple benefits to investors.
An 'authorized company' is a new category of company that replaced the Category 2 Global Business Licence (GBC2).
A foreign-owned company that conducts its business outside Mauritius (or with such a class of persons as may be specified in the FSC Rules) has a management place outside of Mauritius.
A foreign-owned company is regarded as an 'authorized company' where its business is conducted principally outside Mauritius or with such persons as specified in the FSC rules. Its POEM is outside Mauritius.
An authorized company is deemed a "non-resident" for taxation purposes and won't be subject to Mauritius's income tax. The place of taxation for the authorized company will generally be the Place of Effective Management (POEM).
An Authorised Company cannot benefit from the double taxation avoidance agreements ('DTAA'), which Mauritius has established with various countries. It is advisable to have foreign directors and to have most of the director meetings outside Mauritius.
Also, an Authorised Company is obligated to file a return of income to the Mauritius Revenue Authority (MRA) within six months of the year-end.
An Authorised Company must appoint a registered agent in Mauritius. Management Companies can act as permanently-registered agents. They are responsible for the administration of the company. They have a specific set of duties that must be fulfilled by them:
- filing return of income with the Mauritius Revenue Authority (MRA)
- the financial summary must be filed with the FSC
- any legal documentation required by different governing acts
- maintaining records of meetings, transaction records, resolutions, etc.
An authorized company is barred by law from conducting such activities as their main purpose of business:
- financial services
- hold, deal, or manage a Collective Investment Scheme (or Fund) in a professional administrative capacity
- providing nominee services, secretarial services, registered office facilities, directorship services, or other services to corporations
- providing trusteeship services
- activities that may damage the reputation of Mauritius as an International Financial Centre (as determined by the FSC) or contrary to the public interest.
The best-suited activities for an authorized company are:
- Investment holding
- International trade
- Management and consultancy
- IT Services
- Property holding
- Shipping and ship management
The usual incorporation time for an authorized company would be Seven to ten days, provided that all required information is received and verified by the concerned authorities. Taking the help of experts in these matters is the best way to proceed. The enormous legal compliance and formalities require assistance for a swift experience. Learn more about company registration in Mauritius.
The features mentioned above are more than enough to understand that the authorized company is a step towards Mauritius's economic advancement. All GBC2 companies had to transition to Authorized Company as mandated by the law.
The new regime of the Global Business Sector can be a tricky thing to comprehend and interpret. Our role here at Business Setup Worldwide is to give you the best possible customized solutions to help you develop your own company.
If you want any sort of clarification regarding the new set of regulations, contact us, and we will be more than happy to assist you.