Mauritius has opened its door to foreign capital and expertise, officially since 2001. However, in the past, many incentives were made available to foreign investors for the purpose of creating businesses, employment and wealth. We recall similar strategies that have been behind the success of the textiles industry and the tourism; areas where Mauritians did not possess the required capital or expertise.
The transformation from an agriculture-based economy to a world-class business destination is largely due to the sound strategy that has been designed, implemented and sustained by several governments that held the reigns. The strategy included connecting the tiny island to biggest economies of the world and this involved entering into a multitude of preferential trade agreements and developing general access to the island. No doubt that Mauritius can today boast about an extensive list of trade agreements with ultimately benefits businesses dealing from or with the island.
Enough has been said on the island’s strategic location amidst the Indian Ocean, a bridge of excellence between Asia & Africa, the two emergencies economic giants. The island was known to early European merchant’s ships and navigators, as a port of transit, on their way to the East and back. Today Mauritius proposes Port Louis as an international hub for commercial exchanges, transshipment … cumulating in what is today a world-class Freeport zone. Besides its maritime connection, the country also offers 40 international flights per day, connecting to the major business centers of the world.
Now going inland, there are many incentives that both locals and foreigners enjoy while creating and domiciling their business in paradise-island. Overall, Mauritian businesses enjoy a series of ‘general incentives’ (if I may say so) when compared to other business jurisdiction. I’m not even referring to those black or grey areas in offshore finance or businesses – this applies to everyone having a business in Mauritius. For instance, the tax is at a uniform rate of 15% and applied on ‘profits’ only. The tax administration is simple and straight-forward. You can register your company quite easily through the online interface, with a reduced set of documents in contrary to certain countries where you even need to publish in official newspapers. Companies are registered within 48 hours (not to say 24 hours).
Administration is quite simple, whether we are referring to accounting rules, HR administration, statutory reporting, etc. We have kept company configurations to a limited list, thereby reducing confusion on which type of company to use. Most of the businesses run under the ‘Domestic company’ and the basic requirements are that you need a resident director and a registered office in Mauritius. Once the foreigner obtains his residency permit, he qualifies as a resident director (in the interim, one can use a nominee director, resident in Mauritius). There’s no capital restriction, and it means that you are not forced to block, freeze or even ‘show’ the capital that you have mentioned in your company registration documents (France, for instance, would require you to ‘show’ and you can only get access to it under certain circumstances).
If you are applying for an Investor permit, you would need to show that ‘investment’ of USD100,000 in the company’s bank account but again it is free for use.
This condition is not attached to the ‘company’ itself but applied only in the case of an Investor permit (residency permit) being applied.
One important thing to add: there is no exchange control in Mauritius. What it means? Free movement of funds, provided that its source and generation is from clean and legal business.
Now beyond the already nice business environment, there are added business incentives offered to those operating businesses in ‘encouraged sectors’. Here, we are referring to exemptions from Corporate tax (remember we are taxed at 15% on profits), Duty-free & VAT-free goods and equipment, lowered interest rates on banking facilities, and so on.
Over and above these incentives, there are different schemes that help start-ups and SME (Small and Medium Enterprises) in their development. Just to say, for almost every sector, the government has created a body that works towards the progress of that sector. The SMEs have the Small and Medium Enterprises Development Authority, for instance. A Small Enterprise is one having less than MUR10 million of annual turnover, and a Medium Enterprise is one making over MUR10 million but less than MUR50 million. From this definition, one can imagine the number of businesses that fall into eligibility.
To avoid a long and boring article, I’ve preferred limiting the description of each and every scheme. There are two underlying statements here, Mauritius wants to promote business & it does provide the incentives to those who want to take the plunge. Of course, if you need detailed description and eligibility on any of these schemes, we will be glad to provide you with such information.
While considering all this, I feel frustrated to see investors being dragged (by agents, and non-professional self-proclaimed business experts) into saturated businesses like restaurants, night clubs, and property acquisition. There’s so much to be done on this island and so much offered to you for doing it.
Of course, it doesn’t pay off for non-professionals who are after easy and quick money. Selling you a property is much more lucrative than spending hours with you, devising the best business option and benefits you can reap. In the long run, I’ve always considered active business are rewarding and satisfying to an entrepreneur or investor.
With more than 25 years in business creation and management, we are able to advise on every aspect of a project and provide you with the appropriate advice and solution for an effective realization. Every aspect is taken care of ; legal, technical, financial, HR, immigration, … you name it. Being 100% Mauritian team, we are also able to guide you through the cultural differences that can be important while doing business or relocating to Mauritius.