Mauritius is an island found in the Indian Ocean which markets itself as a link between Africa and Asia. A major part of its economy is traditionally based on sugar, textile and tourism. However, it is now moving towards offshore banking, business outsourcing and luxury real estate. The country is trying to become a fintech hub of excellence.
The Umbrella License
In 2019, Mauritius had announced several key measures and new regulations to promote the island as an international financial centre. These include an umbrella license for wealth management providers, promotion of REITS and boosting the fintech sector.
In his annual budget speech last year, the country’s finance minister revealed that all wealth management service providers will be granted an umbrella license. He advanced that the Mauritius Financial Services Commission will sign an agreement with the Gujarat International Finance Tec City, which is found in India, to recognize Mauritian licensed funds and management companies as being qualified to operate in the Gujarat jurisdiction.
Several changes to drive fintech investment was also announced. To cement Mauritius’s reputation as and IFC, the government has proposed:
- To establish financial advisory services that are powered by robotics and artificial intelligence,
- To introduce a new license for fintech service providers,
- To focus on self-regulation for fintech activities in consultation with United Nations Office on Drugs and Crime,
- To implement the use of e-signatures and e-licenses on a pilot basis and
- To create crowdfunding as a new lisensable activity.
Moreover, to boost international investor’s trust in our financial services sector, the existing regulatory framework will be reinforced. Some of the amendments involve:
- The introduction of a Financial Crime Commission. It is going to act as an apex body to ensure greater coordination and coherence among the relevant bodies investigating and dealing with financial crimes,
- The development of a financial data handling code of conduct by the FSC. This will handle and address cyber risks and
- The Bank of Mauritius, FIU and FSC are going to introduce industry-wide Practice Notes with respect to handling clients’ requests.
Other regulatory changes
Several new regulations and changes were announced so that Mauritius could fulfill its aim to diversify its product base as an IFC. First of all, it is going to promote the development of Real Estate Investment Trusts (REITs). It is planning to do so with an attractive tax regime. It is also going to work on a scheme for headquartering e-commerce activities.
Additionally, more services will be available thanks to the introduction of a framework for Green Finance that is in line with the Marrakesh Pledge. This is a continental coalition of African Capital Markets Regulators and Exchanges dedicated to fostering green financing on the continent.
Moreover, a new trading platform at the Stock Exchange of Mauritius will be established. This will allow medium-sized profitable enterprises that are not qualified for listing on the official DEM markets to raise capital and trade their shares.