New Substance Requirements for Global Business Companies
As previously communicated via our E-News August edition and our Information Sheet pertaining to the changes under the Finance Act 2018, the Financial Services Commission (“FSC”) will issue only one type of Global Business Licence company, namely the Global Business Corporation (“GBC”) as from 01st January 2019.
As per Section 71(3) of the Financial Services Act 2018, a GBC shall at all times:
i. Carry out the core income generating activities in or from Mauritius by:
(a) employing either directly or indirectly a reasonable number of suitably qualified persons to carry out the core activities; and
(b) have a minimum level of expenditure, which is proportionate to its level of activities.
ii. Be managed and controlled from Mauritius.
iii. Be administered by a Management Company.
Whilst we were awaiting additional guidelines and clarifications with regards to what is intended by: “a reasonable number of suitably qualified persons” & “minimum expenditure proportionate to its level of activities” and “core income generating activities”, the above point i(a)(b), the FSC has issued the following Circulars on the 12 October 2018 and 15 October 2018:
With regards to the above point ii. that is “Managed and controlled from Mauritius”, in line with Section 71 (b) of the Financial Services Act, the GBC should:
- Has at least 2 Directors resident of Mauritius of sufficient calibre to exercise independence of mind and judgement;
- Maintains, at all times, its principal bank account with and all transaction through a bank in Mauritius;
- Keeps and maintains, at all times, its accounting records at its Registered Office in Mauritius;
- Prepares its statutory financial statements and causes such financial statements to be audited in Mauritius; and
- Provides for meetings of Directors to include at least 2 directors from Mauritius.
Kindly note that in the next few days, your existing Relationship Officer, Manager or Director will be contacting existing clients individually and advise whether they meet the substance requirements and if any remedial actions would need to be taken. We shall propose tailormade solutions, if required.
In the meantime, for any further information, please feel free to contact your Client Relationship contact person at MITCO or the business development team by email on bd@mitcoworld.com or call them on + 230 404 8000.