CategoriesEditor's Picks Investment

“Mauritius, a world-class international financial centre” – Cathie Hannelas from Rogers Capital

A recognised expert in the tax advisory industry, Cathie Hannelas shares her views on Mauritius as a world-class international financial centre.

How has Mauritius managed to become an emerging international financial centre?

The surge in foreign investment to our island is due to a number of factors including a robust regulatory framework, harmonised tax environment, a bilingual and skilled workforce, political stability, economic diversity, an ideal time zone and compliance with international standards. If you combine all of these with a strategic geographical position and you have the right ingredients for the emergence of a world-class international financial centre (IFC). Today, the financial services sector accounts for 11.5% of our GDP and provides direct employment to more than 7,500 people and many more indirect employments through the transport or hospitality industries for example.

The credibility of the Mauritius IFC has been recognised in the recently published United Nations Conference on Trade and Development (UNCTAD) World Investment Report 2019, whereby Mauritius is mentioned as playing an important role in intra-regional investment flow in addition to deriving quality investments into African and Asian countries.

As a founding member of the African Union, SADC and COMESA, Mauritius has been and remains a strong economic partner amongst African countries, participating in the economic development process and advocating for the economic empowerment of Africa. 

What incentives are offered to foreign companies looking to settle in Mauritius?

Mauritius has a conducive business environment and robust infrastructure. Right from the outset, foreigners get access through an international airport with a modern terminal and an airport city catering for high-value cargo. In addition, Mauritius has an efficient port with deep water quays as well as a reliable and expanding logistics platform. These are what I would call some of the ‘soft’ features which favours Mauritius.

On a more formal note, the followings make Mauritius attractive. There is no restriction on ownership of companies and Mauritius allows for 100% foreign shareholding. In settling here, foreign investors enjoy a hybrid legal system and an investment-friendly regulatory regime. Mauritius is currently 20th in the World Bank’s Ease of Doing Business ranking. Being located in Mauritius offers a wide range of benefits, including preferential market access to Africa, Europe and USA; a harmonised tax regime; sophisticated product offerings such as Protected Cell Companies, Limited Partnerships, Trusts and Foundations, Regional Headquarters or Family Offices. These incentives can only contribute to provide foreign companies with optimised benefits they seek.

From a tax perspective, the advantages include, no capital gains tax; dividends paid by a Mauritian company are tax exempt; no withholding tax on dividends paid; and no inheritance tax.

Mauritius continuously strives to improve its attractiveness by being forward looking. For instance, in the recent National Budget 2019, the Prime Minister has announced that Mauritius will pursue its ambition to become a Fintech hub in the region through the implementation of the several measures, including new licences for Fintech Service providers and a regulatory regime for Robotics and AI enabled financial advisory services.

The financial reputation of Mauritius is often at stake on the international scene. According to you, is this justified?

The branding of Mauritius as a tax haven is grossly unfounded. The main characteristics of a tax haven jurisdiction are that there is no or low taxation, no treaties, the culture of secrecy and no substance. Mauritius ticks none of those boxes.

The country applies a harmonised 15% tax rate i.e. to residents and non-residents alike. 15% tax is certainly not negligible. If reduced rates of taxes are applied in certain instances, these rates do not discriminate between residents of Mauritius and non-residents i.e. both are treated the same way.

We have a proper treaty network, based on the Organisation for Economic Co-operation and Development (“OECD”) and UN Model, which have been negotiated bilaterally with partner countries founded on mutual understanding. Moreover, Mauritius has shown its commitment to combatting tax evasion by signing, in July 2017, the Multilateral Convention to implement the OECD measures to prevent Base Erosion and Profit Shifting (BEPS “Multilateral Instrument” or “MLI”) and treaty abuses.

In addition, Mauritius has ratified Tax Information Exchange Agreements with several countries, disclosing information upon request. Tax treaties, by definition, also require the exchange of information with partner countries when necessary. Mauritius’ new Code of Corporate Governance, coupled with its presence on the OECD’s white list, represents great strides towards better transparency.

It is important to highlight that the country has been rated as Compliant by the OECD and the EU with regards to international standards for the exchange of information on request between tax authorities. With the view to enhance its transparency and collaboration framework, Mauritius is equally committed to the Common Reporting Standard (CRS) and Country-by-Country reporting. Also, none of our tax regime are considered as being harmful by the OECD.

We continue to reinforce our regulatory framework. In that respect, we have addressed the concerns of the EU by introducing the Controlled Foreign Corporation (CFC) rules and stiffening the economic substance in Mauritius. By “substance”, I mean that a company must have a real presence and genuine business activities in the country of incorporation – the absence of which could suggest that its intents are purely tax-driven. Rather than a mere incorporation, the companies must now prove that they are truly carrying out their core income generating activity in Mauritius.

Since 2016, Mauritius has joined the initiative on systematic sharing of beneficial information. Mauritius is a member of the Eastern and Southern Africa Anti-Money Laundering Group to implement the Financial Action Task Force’s (FATF) Recommendations. Our anti-money laundering and combatting the financing of terrorism systems and procedures have been successfully re-evaluated and endorsed by the FATF Global Network.

As companies shift to Mauritius for more reasons other than its tax incentives, the value-creation story in the financial services sector slowly but surely becomes a reality.

This can only augur well for the Mauritius International Financial Centre.

CategoriesDid you know? Editor's Picks Investment Real Estate

Interview of Joël Rault, former ambassador of Mauritius in France, on the tax system in Mauritius

1. What according to you are the main advantages of investing in Mauritius for:
a) an individual?
b) a company?

Any individual or company that is considering an overseas investment has the same issues beforehand. They will weigh the benefits against the disadvantages or risks associated therewith. Different profiles will give varying weight to the different criteria involved based on their personal motivations.

For the purposes of this exercise, it is important to distinguish between individuals who invest in order to make a change in their lives on the one hand and those who invest in Mauritius in order to undertake business activities on the other (investments made by companies and especially the corporate interest are usually motivated by an economic gain).

The key decision criteria for an individual investing in Mauritius for a life change will include factors affecting his personal environment such as leisure, safety, the healthcare system, education and climate.

Other criteria will come into play for those making an investment for the purpose of carrying out business activities in Mauritius or manage their business activities from the country. These include economic stability, air connectivity, high-bandwidth digital access and the ease of doing business. The same applies for other legal entities wishing to invest in Mauritius.

It is worth noting that Mauritius has reached upper middle-income country status with a GDP per capita of USD9,200. The country is also internationally recognised for its governance framework as well as its business- and investment-friendly environment.

Mauritius has become a flourishing domestic economy as well as a platform to invest and do business in Africa, the Middle East and Asia through its dynamic financial centre, which accounts for more than 10% of national GDP. All these activities are governed by a network of treaties and trade agreements that go beyond the country’s membership in major regional trade blocs.

The benefits of investing in Mauritius largely stem from its greater economic and business relevance than other jurisdictions that capitalise on tax benefits and opacity of transactions. This is what differentiates Mauritius from jurisdictions relying purely on tax optimisation products, which often entail risks. Such is not the case in Mauritius.

Mauritius provides significant non-tax benefits

Situated in an ideal time zone, Mauritius provides significant non-tax benefits in a politically, socially and economically stable environment. The country’s legal framework is investment-friendly with a culture of confidentiality in a well-regulated financial sector.

A number of international banks as well as reputable law and accounting firms are also present in Mauritius with large networks of highly skilled bilingual professionals at unbeatable costs.

These benefits are topped off by a simple tax environment, but again I insist that taxation should in no way be the primary motivation.

While there is a large number of legal regulations governing real estate transactions in the different European countries, it is important to point out that the Mauritian property law is modelled on French law, following the principles laid down by the French Civil Code.

The deeds of sale are signed before a notary and the concepts of off-plan sale (Vente en l’État Futur d’Achèvement – VEFA), preliminary reservation agreement (Contrat de Réservation Préliminaire – CRP) and performance bond (Garantie Financière d’Achèvement – GFA) are widely used and provide foreign investors with the legal assurance they need.

The Republic of Mauritius is among those countries that position themselves as jurisdictions of substance and whose value added lies above all in the level of expertise and know-how. This explains the fine balance between a business-friendly environment (resulting from the synergy between public authorities and private sector professionals) and modern tax policies which promotes investment.

2. How according to you is Mauritius positioned in relation to other destinations around the world? What are your thoughts on the fact that the Mauritian lifestyle is often cited as a primary criterion for choosing the destination?

Indeed, many foreigners dream of living in Mauritius. The beaches, lagoons and warm weather all year round are the first reasons put forward by those who have not yet had a chance to visit the island. And they are perfectly right!

But those who are familiar with the destination would add to this the harmony that prevails in the country. Mauritius is a multicultural nation, and kindness and smiles are part of the DNA of each of its inhabitants, allowing them to live in perfect harmony.

The beaches and lagoons are definitely beautiful, but Mauritius above all opens a world of possibilities for anyone looking for a destination that is known for its ease of doing business in an exceptional living environment, with an internationally acclaimed quality of service.

Mauritian people live mainly outside. The days are long with excellent natural light. A multitude of sporting activities can be enjoyed in Mauritius, from the lagoons to the very heart of the island, with lush and generous nature that is an invitation to leisurely pursuits.

Mauritius also draws its unique culinary and cultural diversity from a melting pot of people of different origins. The country presents itself as a springboard due to its proximity with France (through Reunion Island), Africa and Asia, which facilitates all kinds of trade and transactions.

Mauritius is an ideal destination to grow and focus on true values, such as sharing, openness and tolerance.

3. What are the tax benefits of purchasing property in Mauritius?

Mauritius has a simple tax system: VAT, income tax and corporate tax are all capped at 15%, including tax on rental income; this is coupled with the absence of inheritance tax for deceased persons with tax resident status in Mauritius.

There is no tax on dividends, net worth or dividends.

Additionally, there is no land or property tax in Mauritius.


Joël Rault has left his diplomatic post to resume private practice within his consultancy firm, Hermès Advisory, as a logical continuation of the activities of a former ambassador for whom economic promotion was a top priority during his mandate.

Drawing on his previous experience in the private sector and as Ambassador Extraordinary and Plenipotentiary as well as Senior Adviser to the Deputy Prime Minister and Minister of Finance of the Republic of Mauritius, Joël Rault leverages his knowledge of economic development to deliver extensive services.

He uses his visibility, network and knowledge of the economic and political system in Mauritius, Africa and France as well as his public relations skills, among others, to support any organisation that wishes to move closer to Mauritius, Africa or France.

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