- August 10, 2020
- Posted by: Editor
- Category: Law
Foreign investors coming to Mauritius have several business entities they can choose from when seeking to establish operations here. One of the most popular such entities is the offshore company which has many advantages from taxation and registration points of view.
If you are interested in Mauritius offshore company formation, our local consultants are at your disposal with complete incorporation services. You can also rely on us if you want to set up a company in Mauritius under a different legal form.
Legislation on Mauritius offshore companies
There are two important laws that provide for the creation of an offshore company in Mauritius, and these are the Companies Law of 2001 and the Financial Services Act of 2007. There are two Mauritius offshore company types that can be set up in this country and they are also known as Global Business Companies (GBCs).
Our company formation specialists in Mauritius can offer detailed information on the two laws under which such business forms can be created.
Types of offshore companies in Mauritius
According to the local legislation, there are two types of offshore companies that can be registered in this country. Formerly known as the Global Business Company 1 (GBC1) and the Global Business Company 2 (GBC2), after their licenses, these two business forms have been replaced by the Mauritius Global Business License Companies (GBLC) and the Mauritius Authorized Companies (AC).
The Category 1 offshore company must be incorporated in Mauritius and obtain a license from the Financial Services Commission, however, it will be allowed to conduct business outside the country.
It is possible to use this type of company for the registration of a subsidiary or branch of a foreign company seeking to operate in Mauritius. Moreover, the Category 1 offshore company can be used for the re-domiciliation of a foreign company in Mauritius.
The second type of Mauritius offshore company is the Category 2 business which can be used for completing various operations outside the country, however, it will not benefit from any tax exemptions in Mauritius compared to the first type of entity.
The Category 2 offshore company in Mauritius can be registered as a private company that completes its operations with non-residents. It is mostly suitable for trading and holding operations, cases in which it will need to comply with additional requirements upon incorporation.
No matter the type of offshore company you want to open, our Mauritius company formation agents are at your service with information on how to choose the appropriate business form.
The Category 1 GBC business form in Mauritius
As mentioned above, offshore companies in Mauritius can be divided into two types. The first one is the Category 1 company which implies obtaining a license from the Financial Services Commission upon incorporation. This means that apart from registering it with the Trade Register, it must also obtain a license from the Commission before starting its activities.
Apart from these, this type of offshore company is deemed as a domestic company that can only engage in trading activities or offers services outside the jurisdiction it is incorporated in, therefore outside Mauritius. This is also where most of its tax advantages come from, as its activities will be levied a 3% corporate tax.
This business form is also suitable for foreign companies, as they can use it for their activities in Mauritius. The Category 1 GBC company can be used as a subsidiary or branch office, or as a holding company.
If you need details on Mauritius company formation, our agents can answer all your questions related to the creation of an offshore company.
The Category 2 GBC company in Mauritius
The other type of offshore company that can be set up in Mauritius is the one that requires a Category 2 license. Even if in terms of registration there are not many differences between the two business forms, the Category 2 one offers higher protection to the beneficial owners. It must also obtain its license from the Financial Services Commission and can also be used as a limited liability company.
From a taxation point of view, the Category 2 offshore company will not benefit from protection against double taxation, which is why it is not often used by foreign investors.
No matter the type of operations you want to complete in Mauritius, our local agents can help you create an offshore company.
Requirements for the opening of a Mauritius offshore company
Those who want to open an offshore company in Mauritius must make sure they respect several requirements. According to the local legislation, the following are required to create a GBC in Mauritius:
- at least one shareholder is needed, however, there are no restrictions with respect to their residency;
- such a business form must have a minimum number of 2 directors – there can be no corporate director, and at least one of them must be a Mauritius resident;
- the company must be registered by an authorized Mauritius agent – our specialists can act as such;
- the Mauritius offshore company must have a local address and bank account.
In terms of registration documents, the Memorandum and Articles of Association must be prepared and filed with the Companies Register.
As mentioned above, if you are interested in company registration in Mauritius, our agents can represent your interests with the local authorities. We remind you that for a Mauritius offshore company a local agent must be appointed if you are a foreign shareholder.
Shareholders in an offshore company in Mauritius
The opening of a Mauritius offshore company is quite simple from a shareholding point of view, which is one of its greatest advantages. Compared to other types of companies, a single shareholder who owns all the stock in the company is allowed. Also, beneficial owners can appoint nominee shareholders, provided that the names of the former are reported to the Companies House and Financial Services Commission in Mauritius.
Our Mauritius company formation officers can handle the entire incorporation procedure for an offshore company on behalf of foreign investors.
Directors in a Mauritius GBC company
As mentioned above, a Mauritius offshore company needs at least two directors. At least one of them must be a resident of this country, while corporate directors are not allowed. Another important aspect to consider is that if the company wants to have access to Mauritius’ double taxation agreements, both directors must be ordinary residents of the insular state. They must also be approved by the Financial Services Commission.
The business registration process in Mauritius can be completed from start to end by our local consultants.
Share capital requirements when opening an offshore company
According to the law, there are no specific share capital requirements for opening an offshore company in Mauritius, no matter the type of license it applies for. Moreover, there are no requisites in regard to having a paid-up or authorized share capital.
Also, the offshore company is very flexible from a type of share issuance point of view. An offshore company in Mauritius can issue various types of shares, among which registered, preferred and redeemable ones. It is important to note that an offshore company cannot issue bearer shares.
Our business registration advisors in Mauritius can offer more information on the share capital requirements of an offshore company.
Corporate name and registered agent requirements for offshore companies
The other aspects to pay attention to when setting up an offshore company in Mauritius are its trading name and the obligation of having a registered agent.
When it comes to the corporate name, it must be unique and must include words that imply its recognition as a company. Among these, the words limited, corporation, incorporated are accepted. Their abbreviations can also be used.
Another requirement for an offshore company is to have a registered agent who must be a Mauritius resident who received official notifications on behalf of the business.
Our company formation advisors in Mauritius can act as registered agents for your local business.
Registered address for an offshore company in Mauritius
As any domestic business form, the offshore company must also have a legal address in Mauritius. This can be obtained by renting or leasing office space or an industrial one, depending on the activities it has, or it can use the property of one of the shareholders, where it is possible.
It is also possible for the registered agent to provide its/his or her office as a legal address which can later be changed.
There are no specific requirements related to the premises of the address, the only document to be filed with the Trade Register is the lease or rental agreement, or the property title.
You can obtain more information on the requirements for registering an offshore company in Mauritius from our representatives.
How to register an offshore company in Mauritius
The incorporation of a Mauritius offshore company will start with the trading name reservation which is subject to a few selection criteria (these requirements can be explained by our agents). Then, the statutory documents need to be prepared and authenticated. A Mauritius registered address must also be provided and a local bank account in which the share capital will be deposited must be opened. In terms of share capital, there is no minimum amount imposed under the legislation.
Our company formation agents in Mauritius can help with the registration of an offshore company with the Trade Register and the Financial Services Commission.
The main uses of an offshore company in Mauritius
The offshore company can be employed for various purposes, among these the most common being intellectual property rights holdings, consulting services, real estate property holdings, international trading operations, e-commerce operations, and even for offering brokerage services provided that it obtains the necessary financial services licenses.
It should be noted that authorized companies are not allowed to engage in certain activities. Among these, offering financial or trustee services.
If you are interested in setting up an offshore company for one of the purposes mentioned above, our agents in Mauritius can offer detailed information on the licensing requirements. We also invite you to watch a short video about this type of company:
How long does it take to register an offshore company in Mauritius?
One of the most important advantages of setting up an offshore company is the simple registration requirements completed by the fast incorporation procedure which takes only a few days. However, it is useful to note that the opening of the bank account can take longer – a few weeks.
When it comes to the obligations after the company is registered, the shareholders must know that the company is required to file a simplified annual balance sheet alongside an audited profit and loss account. However, its accounting records and statutory documents must be kept at the legal seat of the company.
If you are interested in information on the accounting requirements imposed on an offshore company in Mauritius, feel free to ask our local agents for details.
Tax advantages of offshore companies in Mauritius
There are many advantages linked to the creation of an offshore company and among these those related to taxation are quite a few. We will only mention the following:
- the dividend distribution tax which can be reduced from 30% to lower rates under double tax treaties;
- the corporate tax which even if established at a rate of 15%, tax credits of up to 80% can be accessed;
- capital gains which are usually taxed at a rate of 40% can be lowered under various circumstances;
- access to almost 30 double tax treaties signed by Mauritius.
Changes that can be made in a Mauritius offshore company
The Mauritius legislation enables companies to make certain changes, among which:
- replacement of the legal address,
- management structure changes that comply with the legal requirements in place,
- changes in the shareholding structure,
- alterations to the share capital.
All changes must be reported to the Companies House in Mauritius through notifications, but also amendments to the Articles of Association when required. It is also possible to change an offshore company’s name by filing a specific form with the Trade Register. Some modifications can be made online with the help of the registered agent.
Relocating a company in Mauritius by using an offshore business form
Foreign investors who want to do business in Mauritius have several options, among which:
- starting a new business here,
- expanding the operations of an existing company,
- relocating a business to Mauritius.
Among these, relocating a business from another country could be in the attention of foreign business owners. This procedure implies closing the operations in another country and registering the entity in Mauritius under the same business name (provided that it is not taken by another company, however, this aspect can be verified before shutting down the company in the foreign country).
After the company is closed, the procedure of incorporating a new business in Mauritius can begin and for this purpose, the offshore company can be a great choice in terms of a legal entity, especially when targeting to offer the same services in other states.
In other words, the Mauritius offshore company enables a business owner to offer the same services he or she provided through the same company registered in the other country.
Company relocation through an offshore legal entity in Mauritius is a good choice for those seeking to minimize their taxes. Our company formation agents can offer more information on all the aspects of moving a business to this insular state.
If you are interested in the creation of a Mauritius offshore company, please contact us.