The FSC is now a member of ANNA

This upcoming year will bring several changes to the financial sector in Mauritius. It goes without saying that these will be welcome by several parties, including investors since the government has been working to improve Mauritius as a fintech hub; an attractive destination for firms to conduct business in. One of its moves will reinforce the image of Mauritius.

On the 28th of December, the Financial Services Commission (FSC) of Mauritius announced that it has become a member of the Association of National Numbering Agencies (ANNA). It had submitted its application, which was approved by the institution on the 2nd of December 2021.

What is the Financial Services Commission?

First, let’s have a look at what is the FSC to better understand its role. The Financial Services Commission was establishED in 2021 with the intention to strengthen the reliability and safety of the financial sector in Mauritius. Its aims are to:

  • promote the development, fairness, efficiency and transparency of financial institutions and capital markets in Mauritius,
  • suppress crime and malpractices so as to provide protection to members of the public investing in non-banking financial products; and
  • ensure the soundness and stability of the financial system in Mauritius.

To put it simply, it is the integrated regulator for non-bank financial services in Mauritius. What are these? They involve all services and products provided by financial firms such as asset management etc. and that contribute to economic growth and development in the country. The sectors regulated by the FSC are insurance, capital markets, funds, global business and pensions. To sum it up, it licenses, regulates, monitors and supervises the conduct of business activities in the sectors other than banking.

One of its main functions is to implement appropriate measures to ensure the protection of those using financial services in Mauritius and to increase awareness with regards to the different benefits and risks related to investments.

The vision of the FSC is to become “an internationally recognized Financial Supervisor committed to the sustained development of Mauritius as a sound and competitive Financial Services Centre” and it plans to achieve this by meeting globally accepted norms and standards.

What is ANNA?

The Association of National Numbering Agencies are the various institutions across the world that assign a unique identification code to each new security as it is issued. Its aim is to make the financial world a more efficient, safer and more stable environment for both financial institutions and investors. Present in more than 120 countries, it involves partnerships with central banks, central securities depositories, data vendors, regulators and stock exchanges.

ANNA’s mission statement is to proactively promote, implement and maintain standards for financial firms. They aim to make related information available in a uniform and accurate structure for the benefit of the global financial markets as a whole and this is done by providing high quality actionable global ID and reference data and services to stakeholders. This will allow companies to uniquely identify, classify and describe entities and financial instruments. It operates in such a way that it is able to deliver consistent financial standards for its members across the globe.

What does this recognition mean for the FSC and for Mauritius?

Following the approval of the FSC’s application in December 2021, the firm has become the only National Numbering Agency (NNA) in the country. Now, it pledges to keep upholding the obligations towards ANNA. This means that, henceforth, it will assign International Securities Identification Numbers (ISINs) that deal with securities trading in Mauritius.

The ISIN is used in any task related to the administration and trading of securities and other financial instruments. This means that they are mandatory for any financial instrument registered in the country, not just those listed on the Stock Exchange of Mauritius.

It should be noted than each ISIN issued requires an issuance fee of $600USD. Nonetheless, the FSC pointed out that only licensed clearing and settlement facilities in Mauritius are authorised to charge such a fee on behalf of the FSC. Moreover, this issuance fee may be subject to revision in the future.

The importance of ISINs for financial firms

Let’s have a look at ISINs and its importance for financial firms? An International Securities Identification Number is made up of a 12-digit alphanumeric code. Each one of them is uniquely generated for a specific security so that it can be easily identified and tracked across the globe.

ISIN is used in the processing of transactions and for recordkeeping and regulatory reporting. Its goal is to reduce delay, mismatches and confusion in global financial markets. Regarded as the defacto standard for trading securities, its use is mandatory for all firms who deal with securities, both locally and internationally.

What are the advantages of ISINs? These numbers will improve the regulatory environment in which a financial firm operates. For instance, it increases transparency. The use of these identifiers makes it easier for regulators to supervise the market. Additionally, these numbers imply increased automation, which improves the overall efficiency of the market.

 As such, these numbers allow firms in Mauritius to operate in a more effective way. Besides more precise administrative control, it ensures increased transparency which enhances security for investors.

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