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tax is imposed, this would involve a maxi-
mum threshold of 3 percent, since the
corporation tax in Mauritius is currently
15 percent. Moreover, the absence of any
tax on capital gains, repatriation of profits,
capital and dividend makes the Mauritian
jurisdiction an ideal platform to provide
a regional headquarter, through which
to conduct all investment decisions on
the continent.
The jurisdiction is rendered more eco-
nomically attractive through the absence
of foreign exchange controls and because
foreign investors may own 100 percent of
shares of their businesses. The panoply of
investment vehicles which may be availed
by the investor also matches sophisticated
jurisdictions. Besides a number of corpo-
rate vehicles such as companies, trusts
and limited partnerships are available
to encourage private equities, collective
investment schemes, holding companies
and headquartering initiatives and general
commercial undertakings to benefit from
the advantages of their investments. Rout-
ing investments through Mauritius may
also serve a treasury function, whereby
the shares of the entity in Mauritius are
pledged, so as to provide finance to the
African entities.
In spite of the numerous tax advantages
that it offers, Mauritius should not be
viewed as a tax haven. Instead, it would
be more appropriately classified as a low
tax jurisdiction. Indeed, the investment
route necessitates the demonstration of
substance on the island. The require-
ment to have local directors, to be able to
benefit from the sacrosanct tax residence
certificate, as well as the necessity to
hold meetings from the offices of the
company, are a few examples of how the
Financial Services Act ensures that the
advantages which are guaranteed by the
double taxation treaties are not abused.
Moreover, there is now the possibility for
offshore businesses to conduct busi-
ness on the island itself, whereby those
transactions will then be amenable to
the standard corporation tax rate. Such
initiatives have dissociated Mauritius
from the negativity which flows from be-
ing branded a tax haven, and has instead
posited the country on the white list of
the Organization for Economic Coopera-
tion and Development (OECD).
The legal system of Mauritius must
not be underestimated, since the hybrid
system of common law and codified
law enables counsel to understand the
backdrop to cross-border transactions.
All transactions are also subject to
significant rules to combat anti-money
laundering and terrorism financing.
The recognition of foreign judgments by
the Mauritian courts and being the first
country in the Southern African region to
enact the International Arbitration Act
2008, based on the UNCITRAL, further
makes Mauritius a jurisdiction of choice.
From a logistical perspective,
Mauritius is ready to provide a working
solution toward investing in Africa. The
availability of regular flights from Mauri-
tius to the continent has been a key fac-
tor in establishing the headquarters of a
company on the island. The possibility to
reach the offices through relatively short
haul flights, as opposed to travelling to
European destinations and further, is a
fundamental criterion. Furthermore, the
presence of multinational banks, which
provide reliable service on the island,
is also a key reason why investment is
routed from and/or effected in Mauritius.
Furthermore, there is a highly edu-
cated workforce, with most people being
bilingual and sometimes even multilin-
gual, fluent in English, French and other
languages like Hindi. This indubitably
opens the door for reluctant Anglophone
and Francophone countries.
Mauritius is undeniably a dot in the
Indian Ocean and has not been bestowed
with substantial natural resources.
Nonetheless, the country seems poised
to create a niche for itself in the regional
financial arena. With a history charged
with innovation, adaptability and flexibil-
ity, Mauritius today prides itself in being
a sound, safe and welcoming investment
center. The African continent, which has
yet to take full advantage of its countless
resources, represents the future where
investments are concerned. The island
unquestionably posits itself as the miss-
ing link which can help African coun-
tries reach their full potential.