Introduction to the Mauritian foundation
The foundation is a distinct legal entity, endowed with its own legal personality, established with the purpose of holding, managing and administering assets for the benefit of designated persons or for the achievement of defined objectives. In Mauritius, foundations are governed by the Foundations Act 2012, modern legislation that positions Mauritius among the most advanced jurisdictions in foundation law.
The foundation is fundamentally distinguished from the trust by its legal nature. While the trust is a contractual arrangement in which assets are held by the trustee, the foundation is a body corporate in its own right that holds its assets in its own name. This feature makes the foundation particularly attractive to people from civil law jurisdictions (France, Belgium, Luxembourg, Switzerland, French-speaking Africa), who are more familiar with the concept of a body corporate endowed with governance bodies.
Foundation vs Trust: Mauritius offers a choice between two complementary wealth management structures. The foundation (Foundations Act 2012) and the trust (Trusts Act 2001) pursue similar objectives but rest on distinct legal foundations. For a detailed comparison, see our guide Foundation vs Trust.
The Foundations Act 2012: legal framework
The Foundations Act 2012 is the legislative framework governing foundations in Mauritius. This legislation, inspired by international best practices (Liechtenstein, Panama, the Netherlands), was designed to offer a secure, flexible legal environment that complies with global regulatory standards. It was developed in a manner complementary to the Trusts Act 2001.
| Aspect of the Foundations Act 2012 | Main provisions | References |
|---|---|---|
| Formation and registration | Foundation Charter registered with the Registrar of Foundations, name including the word "Foundation" | Sections 5-12 |
| Legal personality | The foundation acquires legal personality upon registration — an entity distinct from its founder | Section 4 |
| Governance | Council of at least 1 member, qualified FSC-licensed secretary mandatory | Sections 13-20 |
| Beneficiaries | Designated persons, categories of beneficiaries, or specific objects (purpose foundation) | Section 21 |
| Assets and endowment | Mandatory initial endowment, assets held in its own name, Council's investment power | Sections 22-25 |
| Amendment and dissolution | Charter amendment procedure, voluntary or judicial dissolution, orderly winding-up | Sections 26-35 |
| Compliance and reporting | Keeping of registers, KYC/AML obligations, annual report to the Registrar | Sections 36-42 |
Structure and governance
The Mauritian foundation is built on a clear governance architecture, structured around four main actors. This organisation, close to that of a company, is immediately understandable to practitioners from civil law jurisdictions.
The Founder
A natural or legal person who establishes the foundation. They draft the charter, define the objectives and governance, and endow the foundation with its initial assets. The founder may retain certain rights and powers defined in the charter (the right to amend the charter, to add beneficiaries). Resident or non-resident of Mauritius.
The Council
A collegial governing body composed of at least 1 member. The Council administers the assets, implements the objectives of the charter, manages investments, makes distributions and ensures regulatory compliance. Functions similarly to a company's board of directors.
The beneficiaries
Natural or legal persons designated to benefit from the assets or income of the foundation. The charter may designate named beneficiaries, categories of beneficiaries (descendants of the founder), conditional beneficiaries, or no beneficiary at all (purpose foundation).
The Secretary
A qualified person holding an FSC (Financial Services Commission) licence. The secretary ensures regulatory compliance, acts as the interface with the authorities, keeps the mandatory registers and ensures compliance with the Foundations Act 2012. A legal requirement for every Mauritian foundation.
The Foundation Council: role and responsibilities
The Council is the central body of the foundation. Its responsibilities are defined by the Foundations Act 2012 and set out in more detail in the charter and the internal rules.
| Responsibility | Description | Obligation |
|---|---|---|
| Administration of assets | Management, preservation and growth of the foundation's wealth | Fiduciary obligation |
| Implementation of objectives | Achievement of the objectives defined in the Foundation Charter | Compliance with the charter |
| Investment management | Investment policy consistent with the internal rules and the objectives | Duty of care |
| Distributions | Making distributions to beneficiaries in accordance with the conditions of the charter | Compliance with internal rules |
| Regulatory compliance | Compliance with KYC/AML obligations, reporting, keeping of registers | Legal obligation |
| Minutes | Keeping minutes of Council meetings and documenting decisions | Legal obligation |
Constitutive documents
The Foundation Charter
The Foundation Charter is the main constitutive document. It is publicly registered with the Registrar of Foundations, which confers transparency and legal certainty on the structure.
| Element of the charter | Description | Nature |
|---|---|---|
| Name of the foundation | Must include the word "Foundation" — unique name verified with the Registrar | Mandatory |
| Objectives | Purpose of the foundation: wealth management, asset protection, philanthropy | Mandatory |
| Identity of the founder | Name and contact details of the founder (natural or legal person) | Mandatory |
| Initial endowment | Amount and nature of the initial assets transferred to the foundation | Mandatory |
| Composition of the Council | Number of members, method of appointment, powers and responsibilities | Mandatory |
| Beneficiaries | Categories of beneficiaries and distribution principles | Mandatory (except for a purpose foundation) |
| Duration | Fixed or indefinite duration of the foundation | Mandatory |
| Amendment and dissolution | Conditions for amending the charter and dissolving the foundation | Mandatory |
The Internal Rules
The internal rules supplement the Foundation Charter by setting out the operational arrangements of the foundation. Unlike the charter, the internal rules are confidential documents that are not accessible to the public. This two-tier structure offers a balance between institutional transparency and confidentiality of the wealth-related provisions.
Decision-making procedures
Quorum, voting rules, procedures for convening Council meetings, delegation of powers, specialised committees (investment, distribution, compliance).
Distribution criteria
Detailed conditions for distributions to beneficiaries: amounts, frequency, conditions precedent, age of access to capital, objectives to be achieved.
Investment policy
Authorised asset classes, acceptable level of risk, required diversification, geographic restrictions, management of conflicts of interest.
Internal governance
Procedures for the appointment and removal of Council members, specific rights of beneficiaries, role of the founder after formation, succession within the Council.
Strategic advantage: The distinction between the public charter and the confidential internal rules makes it possible to meet institutional transparency requirements while protecting sensitive information relating to beneficiaries, distribution amounts and wealth strategy. This is a major advantage of the foundation compared with other jurisdictions where all constitutive documents are public.
Advantages of the Mauritian foundation
Own legal personality
The foundation is a distinct body corporate. It can hold assets in its own name, enter into contracts, open bank accounts, sue and be sued, and be a party to legal relationships. This feature considerably simplifies legal and commercial operations, particularly in civil law jurisdictions that do not fully recognise the trust.
Familiarity for civil law clients
For families and investors from civil law jurisdictions (France, Belgium, Luxembourg, Switzerland, French-speaking African countries, Latin American countries), the foundation is an immediately understandable legal concept. The notion of a body corporate endowed with governance bodies is a well-known legal framework, unlike the trust, which can generate mistrust or misunderstanding.
Comparative advantages
| Advantage | Description | Target audience |
|---|---|---|
| Legal personality | Distinct entity able to act in its own name | All |
| Civil law recognition | Familiar concept in civil law jurisdictions | French-speaking, European and Latin American clients |
| Structured governance | Collegial Council with formal procedures | Large families, complex estates |
| Founder's rights | Possibility of retaining certain powers after formation | Founders wishing indirect control |
| Asset protection | Legal separation reinforced by the body corporate's personality | Entrepreneurs, professionals |
| Dual confidentiality | Public charter + confidential internal rules | Families seeking discretion |
| Flexibility of use | Wealth-related, philanthropic, commercial | All |
| Competitive tax framework | 0% inheritance/gift, ~3% GBC (subject to substance conditions), 45 DTAs in force (MRA, 2026) | All |
Practical applications of the foundation
Family wealth management
Centralised holding and management of multi-jurisdictional family wealth: international real estate, holdings arising from company formation in Mauritius, investment portfolios. The Council provides professional governance aligned with the family's objectives.
Asset protection
Separation of assets from the founder's personal estate. The foundation's legal personality reinforces protection: the foundation holds the assets in its own name, creating an additional legal barrier against the founder's creditors.
Estate planning
Organisation of intergenerational transfer without probate, without inheritance duty in Mauritius, and with continuity of management. The foundation survives the founder's death — the Council remains in office and continues to pursue the objectives defined in the charter.
Philanthropy and patronage
A vehicle for philanthropic and charitable activities. The foundation may pursue objectives of general interest (purpose foundation): education, health, environment, culture. It is possible to combine wealth-related and philanthropic objectives.
Foundation and holding of family businesses
One of the most common applications of the Mauritian foundation is the holding of interests in family businesses. The foundation holds the shares of the family company or companies, and the Council governs the foundation (and, indirectly, the business) in accordance with the objectives defined by the founder.
- Continuity: upon the founder's death, the Council continues to manage the holdings without interruption
- Conflict prevention: governance rules are set in advance, avoiding disputes between heirs
- Professionalisation: the Council may appoint professional managers independent of the family
- Unity of the estate: the holdings remain within a single structure, avoiding fragmentation
Foundation and Mauritian taxation
Tax framework of the foundation in Mauritius
- No inheritance duty and no gift duty (0%)
- No capital gains tax
- No wealth tax
- Standard tax rate of 15% for resident foundations
- An effective rate of ~3% is possible for foundations with a GBC (Partial Exemption System — 80% exemption, subject to substance conditions)
- Exemption for non-resident foundations on foreign-source income
- Access to the network of 45 double taxation avoidance agreements in force (MRA, 2026)
- FATCA/CRS compliance: reporting obligations to international standards
The applicable taxation depends on the specific structure of the foundation, its tax residence, the nature of its activities and the tax treaties in force. A thorough tax analysis is essential to determine the optimal regime. See our pages on taxation in Mauritius and tax optimisation for more details.
International comparison
The Mauritian foundation ranks among the most competitive jurisdictions for this type of structure:
| Criterion | Mauritius | Liechtenstein | Panama | Netherlands |
|---|---|---|---|---|
| Legislation | Foundations Act 2012 | PGR 1926 (revised) | Ley 25 de 1995 | Wet Stichtingen |
| Legal personality | Yes | Yes | Yes | Yes |
| Inheritance duty | 0% | 0% (intra-family) | 0% | 10-40% |
| Tax treaties | 45+ | ~20 | ~15 | 90+ |
| Effective corporate tax rate | ~3% (GBC) | 12.5% | 25% | 25.8% |
| Confidentiality | Public charter, confidential internal rules | High | High | Moderate |
| Costs | Competitive | High | Moderate | Moderate |
| Reputation | FATF compliant, OECD | Improved (EEA) | Variable | Excellent (EU) |
Formation process
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Consultation and design
Analysis of your wealth-related, family and tax objectives. Design of the foundation structure best suited to you: choice between a private wealth foundation, a philanthropic foundation or a mixed foundation. Definition of governance and distribution policy.
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Drafting the charter
Preparation of the Foundation Charter defining the objectives, the composition of the Council, the categories of beneficiaries, the initial endowment, the conditions for amendment and dissolution, and the duration of the foundation.
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Drafting the internal rules
Preparation of the confidential Internal Rules detailing the decision-making procedures, the distribution criteria, the investment policy, the specific rights of beneficiaries, and the procedures for appointing/removing Council members.
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Regulatory compliance
KYC/AML (Know Your Customer / Anti-Money Laundering) process for the founder, the Council members and the identified beneficiaries. Verification of compliance with FATCA/CRS obligations.
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Registration
Filing of the charter with the Registrar of Foundations and obtaining the certificate of registration. Allocation of the identification number. The foundation acquires legal personality upon registration.
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Appointment of the secretary
Appointment of a qualified secretary holding a licence issued by the FSC (Financial Services Commission). The secretary provides the regulatory interface and ensures the foundation's ongoing compliance.
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Initial endowment and activation
Transfer of the initial assets to the foundation, opening of bank accounts in the name of the foundation, implementation of the investment policy and start of active wealth management.
Foundation vs Trust: which to choose?
Mauritius offers a choice between the foundation and the trust. The optimal choice depends on your legal environment of origin, the location of your assets, the residence of your beneficiaries and your governance preferences.
| Criterion | Foundation (Foundations Act 2012) | Trust (Trusts Act 2001) |
|---|---|---|
| Legal nature | Distinct body corporate | Contractual (fiduciary) arrangement |
| Governance | Council (collegial body) | Trustee (single or co-trustees) |
| Holding of assets | In its own name | In the name of the trustee |
| Civil law recognition | High (familiar concept) | Variable (foreign concept) |
| Asset protection | Strong (body corporate personality) | Very strong (discretionary trust + firewall) |
| Confidentiality | Public charter, private internal rules | Fully confidential |
For a complete comparative analysis, see our dedicated guide Foundation vs Trust in Mauritius.
Disclaimer: The information presented on this page is provided for guidance only and does not constitute legal or tax advice. Setting up a foundation involves complex legal and tax considerations that vary depending on your personal situation and country of residence. The Foundations Act 2012 and the associated regulations are subject to change. We recommend consulting a qualified legal and tax adviser before making any decision.