MAURITIUS Law and Practice Contributed by: Fazil Hossenkhan, Nafiisah Jeehoo, Kelly Li and Alicia Kwan Pang, Bowmans
• a PCIS is only available to a sophisticated investor, or on a private placement basis in the case of an open-end fund where the minimum subscription amount is at least USD200,000, and in the case of a closed-end fund where the subscription amount is generally more than USD200,000. 4.4 Rules Concerning Marketing of Alternative Funds The Securities Act 2005 and the Rules and Regulations thereunder, as well as the Guidelines for Advertising and Marketing of Financial Products 2014 issued by the FSC (the “Guidelines”), regulate the content and distribution of marketing materials. The Guidelines set out the requirements for the content of advertisements and marketing materials, including specific disclo - sures and disclaimers on the product and the persons promoting it, and require that all marketing materials be submitted to the FSC prior to dissemination. Securities of expert funds and PCISs may only be marketed to investors as specified in the regulations relating to these funds. As per recent amendments in 2021, foreign AIFs may be marketed to “sophisticated investors” in Mauritius without the need for any regulatory approval. Only locally licensed intermediaries (such as invest - ment advisers, investment dealers or investment bankers duly licensed by the FSC) are authorised to solicit retail investors. 4.5 High Net Worth or Retail Investors Mauritius has two key fund products specifically designed for high net worth investors – professional collective investment schemes (PCISs) and expert funds as further detailed in 2.1 Types of Alternative Funds and Structures . 4.6 Private Placements Current Legal Position in Mauritius Solicitation The marketing of alternative investment funds to “retail investors” in Mauritius is subject to licensing requirements. These do not apply to “sophisticated investors”. Hence, AIFs can be freely marketed to per -
sons meeting the criteria of “sophisticated investors” in Mauritius. Private placement defined Under the Securities Act 2005, a “private placement” is an offer of securities where the total cost of the subscription or purchase for each person to whom the offer is made is at least equal to the amount deter - mined by FSC Rules, and where each person sub - scribes or purchases for their own account and there The Securities Act and FSC Guidelines for Advertising and Marketing of Financial Products 2014 require that any marketing materials must be submitted to the FSC prior to dissemination. Additionally, it is prohibited to market or advertise private placement products to the general public or retail investors. Reverse solicitation is no publicity attached to the offer. Prohibition on general solicitation There is no explicit statutory regime for reverse solici - tation, but the regulatory approach is conservative. Any activity that could be construed as solicitation (including responding to unsolicited requests in a manner that constitutes marketing) may be subject to regulatory scrutiny. 4.7 Compensation and Placement Agents It is quite common for CIS managers to engage place - ment agents. Such agents must be licensed if they solicit retail investors in Mauritius. The fees, costs and expenses of the placement agent are typically borne by the CIS manager, unless they amount to “organisational expenses” or “operating expenses” (in terms of the fund documentation), in which case, they will be borne by the fund. 4.8 Tax Regime for Investors An investor who is not tax-resident in Mauritius and who does not otherwise derive any income from Mauritius does not have to pay any tax in Mauritius, whether in respect of income or gains (including dis - tributions) received from a fund, its worldwide income or otherwise, and is not required to file any tax returns in Mauritius.
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