Tag Archive for: fund structuring

Fund structuring is a critical step in the establishment of any investment vehicle. In Mauritius, this process must be approached within a clearly defined regulatory and legal framework, as it directly impacts licensing timelines, operational viability and long-term compliance.

While fund promoters often focus on strategy and capital raising, regulatory authorities, including the Financial Services Commission (FSC) Mauritius, assess whether the proposed structure is coherent, compliant and operationally viable from inception.

Structuring Before Capital Deployment

In practice, structuring must be addressed before any capital is introduced into the vehicle.

Promoters are required to define:

• the legal structure of the fund (e.g. CIS, closed-end fund, VCC)
• the regulatory classification of the activity under the Securities Act 2005
• the role of the management company and other licensed participants
• the governance and operational framework supporting the structure

Applications submitted to the FSC are assessed on the basis of completeness, internal consistency and regulatory alignment. Where inconsistencies arise – particularly between the business model, financial projections and supporting documentation – additional queries are typically raised, resulting in delays.

The Role of GBC in Fund Structures

Global Business Companies (GBC) are commonly used in Mauritius for structuring investment vehicles and holding platforms.

A GBC is a tax-resident entity, subject to the requirements of the Financial Services Act 2007 and the Income Tax Act. It is frequently used in fund structures to:

• access Mauritius’ Double Taxation Avoidance Agreement (DTAA) network
• establish tax residency and treaty eligibility
• support cross-border investment activities

However, GBC structures must comply with economic substance requirements, including:

• management and control exercised from Mauritius
• presence of at least two resident directors of sufficient calibre
• maintenance of accounting records and board meetings in Mauritius
• alignment with Core Income Generating Activities (CIGA)

Further guidance on tax and substance requirements can be found via the Mauritius Revenue Authority (MRA).

Failure to meet these requirements may impact both tax residency status and regulatory standing.

When Authorised Companies May Be Relevant

An Authorised Company (AC) is an alternative structure used where activities are conducted primarily outside Mauritius.

Unlike a GBC, an AC:

• is not tax resident in Mauritius
• does not benefit from DTAs
• is subject to a lighter regulatory framework

However, an AC must still demonstrate that:

• its central management and control is exercised outside Mauritius
• its activities are conducted principally outside the jurisdiction

The choice between a GBC and an AC is therefore not purely tax-driven, but must reflect the geographical footprint, operational model and regulatory positioning of the structure.

Alignment Between Licensing, Governance and Investor Expectations

A key requirement in fund structuring is alignment between:

• the proposed licence (e.g. CIS, investment manager, fund administrator)
• the governance framework (board composition, oversight, independence)
• the investor profile and strategy
• the operational reality of the structure

For example, the FSC places emphasis on:

• independence between the board of the fund and the investment manager
• adequacy of risk management and compliance functions
• clarity in the allocation of roles between service providers

Misalignment across these elements may lead to regulatory queries, delays or structural limitations post-approval.

Regulatory Coherence and Substance Requirements

Mauritius maintains a strong commitment to AML/CFT compliance, as well as adherence to international standards set by the FATF and OECD frameworks (CRS, BEPS).

Fund structures must therefore demonstrate:

• robust AML/CFT frameworks
• effective onboarding and transaction monitoring processes
• clear reporting and compliance mechanisms

In addition, regulatory authorities assess whether the structure reflects actual operations, rather than a theoretical model.

Substance, governance and compliance must therefore be operational, documented and aligned with the proposed activity.

Conclusion

Fund structuring in Mauritius is not a purely legal or tax exercise. It is a regulatory process that requires coherence between structure, activity, governance and substance.

For fund promoters, addressing these elements at an early stage allows for:

• more efficient licensing processes
• reduced regulatory risk
• structures that are scalable and sustainable over time

In practice, regulatory approval depends not on the strength of the investment concept – but on the quality and coherence of the structure supporting it.

Get Expert Support for Fund Structuring and Licensing with GWMS

For fund promoters seeking to establish compliant and scalable structures, GWMS provides structured guidance across licensing, governance and regulatory alignment. To discuss your project, contact our team on WhatsApp at (+230) 5936 4636 or request a confidential consultation.