Compliance: a strategic issue for Mauritian funds
In an international regulatory environment in constant flux, compliance is no longer a mere administrative obligation — it is a competitive advantage. Institutional investors, family offices and distributing banks demand an impeccable level of compliance before committing to a fund. Mauritius has understood this well and has considerably strengthened its regulatory framework to meet the most demanding standards.
The Mauritian compliance framework rests on several legislative pillars, which together form one of the most comprehensive frameworks among international financial centres:
- The Financial Intelligence and Anti-Money Laundering Act (FIAMLA) 2002 — General anti-money laundering framework
- The Prevention of Corruption Act (PoCA) 2002 — Anti-corruption
- The United Nations (Financial Prohibitions, Arms Embargo and Travel Ban) Sanctions Act 2019 — Implementation of international sanctions
- The Securities Act 2005 and its implementing regulations — Fund-specific regulation
- The FSC's AML/CFT Guidelines for non-bank financial institutions
- The Good Governance and Integrity Reporting Act 2015 — Obligation to declare unexplained wealth
AML/KYC programme for investment funds
Customer Due Diligence (CDD)
Every Mauritian fund must implement a rigorous investor identity verification programme, calibrated to the identified risk level. The FIAMLA and FSC guidelines distinguish three levels of diligence:
| Diligence level | Application | Required measures |
|---|---|---|
| Simplified Due Diligence (SDD) | Low-risk investors: regulated institutions, sovereign wealth funds, listed companies | Basic identification, lighter verification, no systematic source of funds check |
| Standard Due Diligence (CDD) | Standard investors: individuals, private companies, trusts | Full identification, documentary identity verification, source of funds, UBO identification |
| Enhanced Due Diligence (EDD) | PEPs, high-risk countries, complex structures, high-risk investors | CDD + source of wealth, senior management approval, continuous enhanced monitoring |
Required KYC documents
For individual investors:
- Passport or identity card certified as a true copy (by a notary, lawyer or regulated financial institution)
- Recent proof of address (less than 3 months old): utility bill, bank statement, certificate of residence
- Self-certification of tax residence: W-8BEN form (FATCA) and/or CRS form
- Declaration of the source of the funds invested (source of funds) and, for EDD, of the source of wealth
- PEP (Politically Exposed Person) declaration — mandatory for all investors
For corporate investors:
- Certificate of incorporation and up-to-date constitutive documents (articles of association, memorandum)
- Register of shareholders and officers, ownership structure
- Identification of ultimate beneficial owners (UBO): any person holding 10% or more directly or indirectly
- Recent audited financial statements (last closed financial year)
- Board resolution authorising the investment and designating authorised signatories
- Complete KYC documentation on each UBO (passport, proof of address, PEP declaration)
FATCA obligations
Mauritius-United States intergovernmental agreement
Mauritius has signed a Model 1 IGA with the United States for the implementation of FATCA. This model implies a structured flow of information between the fund, the MRA and the IRS:
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IRS registration
The fund registers with the IRS and obtains a GIIN (Global Intermediary Identification Number). This number is required by correspondent banks and US counterparties.
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Identification of US Persons
Collection of W-8BEN (non-US) and W-9 (US) forms from each investor. Identification of indicia of US nationality or residence (US indicia).
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Annual reporting to the MRA
Transmission of information on US accounts: identity, US TIN, balance or value of the holding as at 31 December, income (dividends, interest, distributed capital gains).
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Automatic MRA-IRS exchange
The MRA automatically relays the information to the IRS. Non-compliant funds are exposed to a 30% withholding tax on their US-source income.
Information to be reported (FATCA)
| Information | Detail |
|---|---|
| Holder identity | Name, address, US TIN (SSN or ITIN) |
| Account balance or value | Value of the holding as at 31 December of the reporting year |
| Income | Dividends, interest, capital gains distributed during the year |
| Gross disposal proceeds | Amount received upon redemption of units |
Common Reporting Standard (CRS)
The OECD's CRS extends the FATCA principle to all partner jurisdictions. Mauritius automatically exchanges tax information with more than 100 jurisdictions, including all EU countries, the United Kingdom, Switzerland, Singapore, Australia, Canada and numerous African and Asian countries. For a detailed guide to these FATCA and CRS obligations, see our dedicated page.
CRS process for funds
- Collection of self-certifications — Each investor must provide a form declaring their tax residence(s) and taxpayer identification number(s) (TIN)
- Account classification — Identification of reportable accounts based on the holders' tax residence. Investors who are Mauritian tax residents are not reportable
- Annual reporting — Transmission of information to the MRA before 31 July each year for accounts of the previous year
- Review of existing accounts — Periodic verification of changes in tax residence and updating of self-certifications
- Entity due diligence — Classification of corporate investors (Active NFE, Passive NFE, Financial Institution) and identification of controlling persons
International sanctions screening
Mauritian funds must systematically verify that their investors, counterparties and beneficial owners do not appear on any sanctions list. Screening must be carried out at initial subscription, then on a continuous basis with lists updated at least daily.
United Nations
Security Council sanctions: asset freezes, travel bans, arms embargoes. Mandatory application under the Sanctions Act 2019.
OFAC (United States)
SDN List (Specially Designated Nationals) and sectoral and geographic sanctions programmes (Iran, Russia, North Korea, etc.).
European Union
Asset freeze lists, financial restrictions and prohibitions on making funds available. Relevant for funds with European investors or assets.
United Kingdom & others
OFSI Consolidated List (UK), Mauritius national lists and any other jurisdiction's lists relevant to the fund.
Economic substance
Since the 2019 reforms, funds holding a Global Business Licence (GBL) must demonstrate genuine economic substance in Mauritius, in line with OECD recommendations (BEPS Action 5) and the EU Code of Conduct Group.
| Requirement | Description | Documentary evidence |
|---|---|---|
| Management and control | Strategic decisions taken from Mauritius | Board meeting minutes, agendas, decision reports |
| Qualified personnel | Competent employees or directors based in Mauritius | Employment contracts, CVs, proof of residence |
| Local expenditure | Operating expenditure proportionate to the activity | Invoices, leases, expense statements |
| Premises | Physical office or workspace in Mauritius | Commercial lease, photos, registered address |
Learn more about economic substance requirements
Governance and internal controls
An effective compliance programme rests on solid governance and documented internal controls:
- Compliance Officer / MLRO — Dedicated person responsible for the AML/KYC programme and suspicious transaction reports to the FIU. Must be qualified, trained and have direct access to the board
- Compliance committee — Periodic review (at least quarterly) of policies, non-compliance incidents and regulatory developments
- Mandatory training — Annual training programme for all staff on AML/CFT obligations, sanctions and detection of suspicious transactions
- Internal audit — Independent annual review of the effectiveness of the compliance programme by an external provider or an internal audit function
- Whistleblowing — Internal mechanism for reporting irregularities, protecting the anonymity of whistleblowers
- Risk assessment — Annual assessment of the fund's ML/TF risks, with the AML programme updated accordingly
Since Mauritius's exit from the FATF grey list in 2021, the FSC has been conducting more frequent and thorough inspections. Funds must be able to demonstrate, at any time, that their AML/KYC programme complies with current standards. A well-documented, regularly tested programme is your best protection.
Our compliance services
Our team of specialists supports Mauritian funds in setting up and continuously monitoring their regulatory programme:
- Drafting of AML/KYC policies and procedures compliant with the FIAMLA and FSC guidelines
- Setting up the FATCA and CRS programme: IRS registration, collection processes, annual reporting
- Training of staff and directors on AML/CFT obligations and best practices
- Periodic compliance review (compliance health check): audit of your programme against current standards
- Assistance during FSC inspections: file preparation, support during the visit, follow-up on recommendations
- Outsourced MLRO service for funds without a dedicated full-time compliance officer
- Annual risk assessment and updating of the AML programme in line with evolving risks
Impeccable compliance for your fund
A robust compliance programme is a prerequisite for attracting institutional investors and maintaining your FSC licence. Our team helps you achieve and maintain the most demanding standards.