Helpful Instructions On How To Open A Company In Mauritius

Mauritius offers a favorable business climate and multiple incentives for foreign investors, including a low tax regime and a network of double taxation avoidance treaties with over 40 countries.

Additionally, this jurisdiction also nurtures a skilled workforce, a stable political environment, and a well-developed financial and legal system. These characteristics all contribute to its popularity as an incorporation location for both onshore and offshore enterprises.

In this article, we will be covering why and how to open a company in Mauritius so you can decide the next steps for your business more easily.

Why Mauritius for incorporation

• Favorable tax system

Mauritius’s tax system is competitive, including a low corporate tax rate of 15%. If your company is a non-resident for tax purposes, meaning it is centrally managed and controlled outside Mauritius, you’ll be exempted from corporate tax, withholding tax, interest, royalties, or any capital gains tax.

• Strategic location

Mauritius is located in the Indian Ocean, making it an ideal trade, investment, and tourism hub for companies doing business in Africa, Asia, and the Middle East. Mauritius is in the GMT+4 time zone, allowing it to do business with Asia in the morning and Europe and Africa in the afternoon.

• Business-friendly environment

The government of Mauritius has taken many steps to create a business-friendly environment, including reducing bureaucracy and streamlining the process of registering and operating a company.

Since Mauritius has signed Investment Promotion and Protection Agreements with many African member states, this is truly a promising destination for investors targeting the market.

• Political stability

Mauritius provides a sense of security for investors and businesses. The modern system of law is a combination of French civil law and common law, while civil and criminal proceedings are based on British practice. Thus, the country has consistently been ranked as one of Africa’s most politically stable countries.

• Double taxation treaties (DTAs)

Mauritius has signed double taxation treaties with over 45 countries (updated February 2023). Under the DTAs, residents of the contracting states are provided relief from double taxation in the form of tax credits, exemptions, or reduced tax rates.

• Reputation

Mauritius is recognized as a well-regulated and transparent financial center, with a robust regulatory framework and a commitment to preventing money laundering and terrorist financing. The jurisdiction is famous for its high level of confidentiality in business and financial operations.

In-depth details on the advantages of establishing a company in Mauritius might provide you with a better understanding of why this jurisdiction remains popular for business.

How to set up a company in Mauritius within 4 steps

Whether you’re a local or a foreign investor, the following steps will help you navigate the business landscape in Mauritius and establish a successful enterprise.

Step 1: Choose a compatible business structure

The first step is to decide on a business entity that best suits your needs, such as a Global Business Company (GBC), or an Authorised Company (AC).

Several types of companies can be set up in Mauritius by foreign entrepreneurs. Take time to consider their features thoroughly and make the right choice for your business!

Global Business Company (GBC)

Previously known as the Global Business Category 1 (GBC1), the GBC allows foreigners to set up a company that predominantly derives income from outside Mauritius and still utilizes all tax treaties and regional agreements.

A resident corporation whose majority of shares or voting rights or the beneficial interest is held or controlled by a non-Mauritius citizen should apply for the GBC model. If you’re conducting or proposing to conduct business principally outside of Mauritius, you need to apply for the compatible Global Business License as well.

If you haven’t received an update on the requirements of a Global Business Company, do go through the necessary information on the GBC regime.

Authorised Company (AC)

Authorised Companies (or GBC2) are commonly used for international trade, investment, and asset protection purposes. An Authorised Company has its business activities, control, and management carried out outside of Mauritius.

Simply put, it is a non-tax-resident offshore Mauritian company, exempted from corporate tax, withholding tax, interest, royalties, or any capital gains tax. It comes with a fast and transparent incorporation process, hence why many entrepreneurs chose to establish an AC in Mauritius.

Overall, Authorised Companies in Mauritius provide a flexible and efficient vehicle for conducting international business while benefiting from the country’s favorable tax and regulatory regime.

Domestic Company (DC)

Unlike Authorised Companies, which are licensed by the Financial Services Commission for offshore activities, Domestic Companies are primarily intended for conducting business within the country as local businesses.

A Domestic Company in Mauritius is incorporated and registered under the Companies Act of Mauritius. Apart from being subject to a corporate tax rate of 15%, they are also eligible for other tax incentives and exemptions, particularly in sectors such as tourism and manufacturing.

Step 2: Name your company

Choose a brand name for your business and ensure it complies with the Companies Act. The availability of a word can be checked online and is free of charge.

To reserve a name, you must complete an “Application for Reservation of a Company Name” form and submit it to the Registrar of Companies.

Step 3: Register your company

Conveniently, the registration can be completed remotely through a form for certain cases, or directly by submitting the required documents at the office of the Registrar of Companies.

By filling out the relevant application form and uploading the necessary documents, you can incorporate your company online through the Companies and Business Registration Integrated System (CBRIS).

Generally, the online form (Form 1: “Application for incorporation of a company“) will include:

• The name, address of the registered office, incorporation/ registration number of the corporate body
• The business name, type, and date or proposed date of incorporation
• The full name, address, and national identification number of the applicant
• Identification of the company’s directors and secretaries
• The date or proposed date of commencement of business
• Evidence that your company is active outside Mauritius and has central management and control outside Mauritius

You will likely need to prepare the Memorandum and Articles of Association, which define the objectives, share capital, and management structure of the company.

Payment of the necessary annual registration fee shall be made following the form submission.

Step 4: Receive the Certificate of Incorporation and a Business Registration Card (BRC)

Upon payment of the prescribed fee and compliance with the related regulations (e.g. the Companies Act 2001), the Registrar will issue you an Electronic Certificate of Incorporation and a Business Registration Card (BRC).

The certificate for incorporation is legal proof of the existence of the company and contains fundamental details about the company, including the name of the company, its registration number, and the date of incorporation.

Post-registration tips for a smooth incorporation

Open a bank account

Once your company is registered, you should start applying for a business banking account. Mauritius companies are not required to open business accounts in the jurisdiction. Offshore banking is allowed.

Regarding a local reputable banking service provider, here are a few potential choices: Mauritius Commercial Bank, Bank One Limited, HSBC Bank (Mauritius), Investec Bank, etc.

Comply with necessary regulations

As a company operating in Mauritius, you must fulfill annual compliance including tax obligations, labor laws, and other compliance requirements.

For instance, under the current laws of Mauritius, an Authorised Company is required to:

• Prepare and file a Financial Summary within 6 months of the financial year-end with the Financial Services Commission (FSC)
• Report an Annual Return of Income with the Mauritius Revenue Authority
• Depending on the directors’ decision, financial records, and supporting documents can be kept at an address inside or outside Mauritius.
• If the above papers are not kept in Mauritius, certain accounts and returns for the operations of the company must be sent back to a local address in Mauritius. A notice of the place where all the accounting records are shall be given to the Registrar.

In contrast, a Global Business Company must maintain and keep the full financial statements, not just simplified versions. A GBC is also expected to file an auditor’s opinion on the financial statements in addition to the above requirements of an AC.

Late filing of accounts and failure to payment of taxes timely are bound to result in financial penalties of up to MUR 20,000 with the cumulative amount increasing significantly over time.

Conclusion

Setting up a company in Mauritius can be a smart choice for many entrepreneurs due to several factors. The country has a stable business environment, a favorable tax regime, a well-educated multilingual workforce, and a good infrastructure, including a modern telecommunications network and excellent port facilities.

Be aware that starting a business in Mauritius, especially offshore, is a complex process, requiring compliance with several legal and regulatory requirements.

Feel free to reach out to our professional team via the chatbox for timely assistance or contact service@bbcincorp.com for incorporation information and advice.