MAURITIUS Law and Practice Contributed by: Valerie Bisasur, Jean-Vincent Dacruz and Shane Mungur, BLC Robert & Associates
Powers of Receiver During the receivership period, the receiver has a wide array of powers to: • manage, control or discontinue the financial institutions’ operation; • stop or limit the financial institution’s payment obligations; • initiate, defend and conduct any proceedings; • suspend, in whole or in part, the repayment or withdrawal of deposits and other liabilities of the financial institution; and • suspend or reduce the right of creditors to claim or receive interest on any money owed to them. Priority of Claims Claims against the assets of a financial institu - tion during compulsory liquidation are settled in the following order of priority: • necessary and reasonable costs, charges and expenses incurred by the receiver, including their remuneration; • wages and salaries of officers and employees of the financial institution in liquidation for the three-month period preceding the taking of possession of the financial institution; • taxes, rates and deposits owed to the gov - ernment of Mauritius; • savings and time deposits not exceeding, in amount, MUR100,000 per account; • other deposits; and • other liabilities. Winding-Up of Financial Institutions A financial institution may also be wound up in accordance with the provisions of Sub-Part II of Part III of the Insolvency Act 2009 (the “Insol - vency Act”).
Section 100 of the Insolvency Act states that the winding-up of a company may be: • by way of a winding-up order made by the court; • by way of a voluntary winding-up com - menced by a resolution passed by the com - pany; or • by way of a resolution of creditors passed at the watershed meeting. Voluntary winding-up may be: • a shareholders’ voluntary winding-up where the company is solvent, and where the liqui - dator is appointed at a shareholders’ meeting; or • a creditors’ voluntary winding-up where the company is insolvent, and where the liquida - tor is appointed by a meeting of creditors. With effect from the commencement of a volun - tary winding-up, a liquidator is appointed and has custody and control of the financial institu - tion’s assets. Priority of Claims Section 91 of the Banking Act provides that, in the event of the winding-up of a financial insti - tution, all assets of the financial institution must be made available to meet all deposit liabilities of the financial institution in the following order of priority: • deposit liabilities incurred by the financial institution with its customers; • deposit liabilities incurred by the financial institution with other financial institutions; and • other liabilities of the financial institution.
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