Highlights of the Mauritius Anti-Money Laundering
To align the Mauritius International Financial Centre to international norms and standards pertaining to AML/CFT and meet the Financial Action Task Force (FATF) requirements, the Anti-Money Laundering and Combatting the Financing of Terrorism (Miscellaneous Provisions) Act 2020 (the “Act”) was approved by the Mauritian Parliament and came into force on 9 July 2020. This highlight sets out the changes to the laws brought by the Act which are relevant to the Global Business sector.
Changes to the Companies Act
- Access to beneficial ownership information – Companies registered in Mauritius were already required to disclose information on their beneficial owners (BO) or ultimate beneficial owners (UBO) to the Registrar of Companies and record same in their share register where the shares were held by a nominee shareholder. The Act has further expanded the definition of the term ‘nominee shareholder’ to put emphasis on those BO/ UBO who exercise their right through the nominee shareholder indirectly through the agency of one or more persons.
- Beneficial ownership information shall be lodged with the Registrar (i) at the time of incorporation of a company; (ii) at the time of registration of a foreign company; (iii) at the time of registration by way of continuation of a company; (iv) on filing of the annual return of a domestic company; (v) in the case of a foreign company, on filing the financial statements of the company; (vi) upon any change, including transfer, in the shareholding of a company; (vii) at the time of an issue of shares. Upon any change, including transfer, in the shareholding of a company or at the time of an issue of shares, beneficial ownership information shall be filed to the Registrar within 14 days from the date by which any entry or alteration is made in the share register.
This obligation will apply where shares of the company are held by a nominee shareholder.
- The Act also requires designation of an officer (ordinarily resident in Mauritius) to provide, upon request by any competent authority, all basic information and beneficial ownership information of the company. The Registrar shall be notified upon designation or change of the officer, within 14 days.
- In addition to the name and registered address of a private company holding a Global Business License (GBL) or an Authorised Company, a person may on payment of a prescribed fee have access to the proof of incorporation, legal form and status of the company and its basic regulating powers and list of directors at the Registrar of Companies office.
- Failure to comply with the requirement to furnish beneficial ownership information to the Registrar of Companies shall amount to an offence and shall, on conviction, be liable to a fine not exceeding MUR 300,000 rupees. The Registrar of Company may further strike off a company if it fails to disclose beneficial ownership information.
- The terms BO/UBO have been extrapolated under the Companies Act and are extended to the Foundation Act, Limited Liability Act and Limited Partnership Act. Beneficial ownership information pertaining to limited liability partnerships, limited partnerships and foundations, shall be disclosed to the Registrar of Companies upon the incorporation and registration of any such entity, and at the time of making certain mandatory filings. This obligation will apply where shares/beneficial interest of the partnerships/ foundations are held by a nominee.
Changes to the Financial Intelligence and Anti-Money Laundering Act
- The timeline for financial institutions and reporting person for filing a suspicious transaction report to the Financial Intelligence Unit (FIU) has been reduced from 15 days to 5 working days after the suspicion arose. Failure to do so shall be an offence and shall, on conviction, be liable to a fine not exceeding MUR one million rupees (USD 25000) and to imprisonment for a term not exceeding 5 years.
- The FIU has been empowered to issue guidelines to auditors, reporting persons and internal controllers of credit unions.
- New provisions have been enacted to facilitate exchange of information among regulatory and supervisory agencies in Mauritius, further regulate sectors such as jewellery, real estate, gambling and cooperative societies for AML/CFT purposes, increase the fines and penalties relating to AML/CFT offences and propounding a risk-based approach to supervision.
Changes to the Financial Services Act (FSA)
- Section 23 of the FSA has been amended to provide that approval of the Commission shall not be required in respect of the issue or transfer of non-voting shares of CIS or CEF and reporting issuers that do not hold a financial services licence but whose securities are listed on a Securities Exchange in Mauritius.
- The Commission can carry out onsite inspections on the business premises of a licensee or such other place at its discretion and the frequency for the on-site inspections shall be determined but not limited, by the money laundering or terrorism financing risks present.