- August 10, 2020
- Posted by: Editor
- Category: Law
Mauritius is one of the most popular offshore destinations and one of the most reputable financial centers among insular states in the Indian Ocean which is why it is suitable for conducting a wide range of operations.
Apart from the low company formation costs and the advantageous taxation system, Mauritius is also a great place for investment management activities. Such activities need to be completed under strict regulations imposed by the Financial Services Commission (FSC) which also requires obtaining a Mauritius forex license before offering any services.
Below, our local specialists explain the main steps related to obtaining a forex license in Mauritius. You can rely on us for assistance in obtaining a forex license and business registration in Mauritius.
Legislation on financial services in Mauritius
Mauritius is known for the high-quality financial services provided to clients all over the world which is doubled by a large number of professionals in this field. The Mauritius Forex License is well-regulated and falls under no less than 3 laws: the Financial Services Act, the Insurance and the Securities Laws.
According to the legislation, a person or company seeking to offer financial services that require a Forex license must also obtain a brokerage license who can deal in various currencies, among which euros, US dollars, GBP, but also gold and silver.
Another requirement for Forex license holders is to register a Global Business Company. The Category 1 type of company is the most appropriate for such activities, as they are often employed for offering financial services.
If you are interested in conducting other types of activities, our local agents can help you set up limited liability companies in Mauritius.
The main categories of investment dealer licenses in Mauritius
The Forex License is part of a greater category of investment dealer licenses which must be obtained by natural persons of companies carrying out activities that enable them to act as intermediaries or brokers in the financial industry. There are several types of licenses that can be obtained by applicants, in accordance with Section 20 in the Financial Services Act.
According to this section, the following categories of licenses can be obtained:
- the full service dealer license;
- the broker license;
- the discount broker license;
- the unrestricted and restricted broker licenses.
Those to want to trade on the Forex market in Mauritius can apply for one of these licenses.
Our company formation agents in Mauritius can offer more information on the legislation governing Forex licenses.
You can also read about the Mauritius Forex License in the infographic below:
The Mauritius Investment Dealer License – main features
According to the national legislation, the Mauritius forex license is known as the Investment Dealer License and as its name says under it one can offer various services. There are various requirements associated with obtaining a forex license and among them, foreign entrepreneurs must know that they need to have a local office in Mauritius.
The following services are associated with a Mauritius forex license once it is obtained:
- the person or company obtaining it can act as an intermediary for various securities transactions on behalf of clients;
- services related to trading securities as a principal with the purpose of reselling them to the public;
- offering investment advice which must correspond to the usual business activities of clients;
- portfolio management services to both local and international clients.
It should be noted that securities dealing services are related to the intention of making profit which is why obtaining a Mauritius forex license is required in this case.
Our company registration agents in Mauritius can offer more information on the requirements related to applying for an Investment Dealer License here.
The full service dealer license in Mauritius
The Forex License can be obtained by applying for a full service dealer license that enables a person to act as an intermediary in securities transactions on behalf of clients. The holder of such a license can also trade and resell securities to the general public. It is also possible for a full service dealer licensee to underwrite or distribute securities on behalf of an issuing company.
The full service dealer license is the most complete type of Forex License one can apply for.
Foreign investors who want to open companies in Mauritius with the purpose of applying for Forex licenses must meet specific requirements that can be explained by our local consultants.
Obtaining a broker license in Mauritius
The Mauritius Forex market can also host broker and discount broker license holders who can obtain authorizations from the FSC to manage portfolios and execute client orders related to securities transactions.
Discount brokers can be authorized to execute orders without the possibility of advising clients. When it comes to obtaining a Forex License as a discount broker, a company must meet additional requirements. Among these, the company must obtain an investment dealer license and must have a substantial share capital.
Foreign companies can also operate on the Mauritius Forex market by setting up subsidiary companies that meet the same requirements as local entities, in this case, Global Business Companies.
If you need information on the requisites that need to be met in order to obtain a license as a GBC company in Mauritius, our specialists are at your service with detailed information.
Registering a GBC Category 1 in Mauritius for Forex trading activities
The GBC company is also known as a business used for completing offshore operations which is the most suitable for providing trading services to foreign investors. The registration requirements for an offshore company in Mauritius are not complicated and imply drafting the statutory documents and filing them with the local Trade Register. It should be noted that the company must have a registered address in Mauritius, resident company secretary, at least two resident directors, and a local bank account.
The resident company secretary and directors must be kept for the first of the activity of the company. Also, once registered, the company must submit proof of offering its services abroad when filing for the Forex License with the Financial Services Commission.
Here are the other services a GBC1 company can offer:
- fundraising activities from the general public, however, investor protection is required;
- securities trading services as a principal with the purpose of reselling them;
- investment advisory services.
Companies holding Forex licenses benefit from various tax advantages in Mauritius, especially when registered as offshore business forms.
Also, if you are interested in asset protection in Mauritius, we can help you set up a trust.
Requirements for Mauritius companies offering trading services
The creation of a company with the purpose of obtaining a Forex license in Mauritius must meet certain requirements. The company must have at least one shareholder, and even if he or she is not a resident of Mauritius, it must appoint a local agent to represent the business in relation to the local authorities.
In the case of companies applying for a Forex license, the local agent role must be taken by an authorized Management Company which must be licensed by the Financial Services Commission. The same company can act as company secretary.
Our company formation specialists in Mauritius can offer more information on the requirements related to registering a business with the purpose of obtaining a trading license.
Share capital requirements for Forex licensed companies in Mauritius
While the offshore company is not required to have a minimum share capital, when applying for a Forex license, there are several requirements to be respected due to the risks involved. The share capital of the company can not decrease under 500,000 USD, while it must also pay fees of 25,000 USD per year. Also, the issuance of the Forex license is subject to specific fees.
The company must also submit various reports on its activities to the supervisory authorities in Mauritius.
A Forex license in Mauritius can be obtained in approximately 3 months.
Local bank account and office for Forex license holders in Mauritius
Among the most important requirements to obtain a Forex License in Mauritius are having a bank account set up with a local financial institution and an office in the country. The bank account can be opened with any bank in the insular state, while the office can be located in any city of the country.
It should be noted that the bank account will be used for depositing the share capital and then for the transactions of the license holder.
Our Mauritius company formation agents can help with the creation of the bank account.
Resident director for a GBC company
Another important requirement for the GBC company applying for the Forex License in Mauritius is to have at least two resident directors. This requisite is not imposed just for companies applying for investment dealer licenses, but to all offshore companies operating under Category 1 and 2 licenses and that engage in financial activities.
We remind foreign citizens that Mauritius is also a great asset protection destination and can be used for setting up trusts.
Our consultants can assist those who want to create trusts in Mauritius.
Requirements for obtaining a Mauritius forex license
According to the Financial Services Commission, a foreign or local service provider is required to comply with the following requirements when applying for a Mauritius forex license:
- one must register a company in Mauritius (the Global Business Company Category 1 is preferred for such activities);
- the company must have an office and a bank account in Mauritius;
- at least one director who is a resident person with knowledge and experience in the financial sector must be appointed;
- a detailed business plan must be submitted with the FSC upon applying for the forex license.
Our company formation specialists in Mauritius can assist with the incorporation of an offshore company under which one can obtain an Investment Dealer License.
Documents required to obtain a forex license in Mauritius
Both local and foreign investors can set up companies with the purpose of applying for a Mauritius forex license. The following documents must be filed with the Financial Services Commission in order for a fast and easy licensing procedure:
- notarized copies of valid passports of all shareholders, directors and/or beneficial owners;
- character reference letters for each director and shareholder (at least 2 letters provided by professionals);
- certified diplomas as proof of high educational studies in the financial field;
- proof of residential address, such as a recent utility bill for each shareholder and director;
- bank references for all shareholders and directors;
- curriculum vitae for each shareholder and director;
- all directors and shareholders must also have clean criminal records that will be submitted with the FSC;
- a detailed business plan;
- various policies related to the types of services to be provided.
If at least one of the shareholders is a corporate person, its articles of association, a certificate of good standing and a copy of the annual return is required.
It should be noted that in order to benefit from extended tax advantages, the type of company to be registered can be an offshore company with two resident directors.
If you want to apply for a Mauritius forex license, our agents can handle the registration procedure of the selected business form.
Why choose to invest in Mauritius
Mauritius is one of the most important offshore financial centers in the world, however, it also has a local thriving economy which makes it appealing for investors interested in exploring other industries, such as tourism.
Those interested in providing financial services can also engage in fintech activities which have started to become very appealing since Mauritius is a founding member of the Africa FinTech Hub.
Why apply for a forex license in Mauritius?
If you want to obtain an Investment Dealer license in Mauritius, here are the main advantages:
- the company to run the investment management can be incorporated in 3 to 4 weeks;
- the Mauritius forex license will be issued in 3 to 4 months;
- the corporate tax when using an offshore company can be as low as 3%;
- the company can also take advantage of more than 30 double tax treaties.
FAQ on the Forex License in Mauritius
Here are some of the most frequently asked questions on the Mauritius Forex License and their answers:
- What is the most appropriate legal entity to obtain a Forex License in Mauritius?
The Category 1 offshore company is the most suitable legal entity for offering financial services under a Forex License in Mauritius.
- Can foreign companies apply for Forex licenses in Mauritius?
Yes, it is possible for foreign companies to operate on the Mauritius forex market through subsidiary companies that meet the same legal requirements as local ones.
- Are there different share capital requirements for investment dealer licenses in Mauritius?
A GBC company must have a minimum share capital of 1 million (around 30,000 USD) in order to apply for an investment dealer license.
- How long does it take to obtain a Forex License in Mauritius?
It takes between 6 and 8 months for the license to be issued by the FSC.
For assistance in applying for a Mauritius forex license, please contact our company registration advisors.