Transparency of the Regulatory System
Since 2006, the government has brought major reforms to trade, investment, tariffs, and income tax regulations to simplify the framework for doing business. Trade licenses and many other bureaucratic hurdles have been reduced or abolished. With a well-developed legal and commercial infrastructure and a tradition of both entrepreneurship and representative government, Mauritius is one of Africa’s most successful economies. Business Mauritius, the coordinating body of the Mauritian private sector, participates in discussions with and presents papers to the authorities on laws and regulations affecting the private sector.
Regulatory agencies do not request comments on proposed bills from the general public. Both the notice of the introduction of a government bill and a copy of the bill are distributed to every member of the Legislative Assembly, and published in the Government Gazette before enactment. Bills with a “certificate of urgency” can be enacted with summary process. All proposed regulations are published on the Legislative Assembly’s website , which is publicly accessible.
Companies in Mauritius are regulated by the Companies Act of 2001, which incorporates international best practices and promotes accountability, openness, and fairness. To combat corruption, money laundering and terrorist financing, the government also enacted the Prevention of Corruption Act, the Prevention of Terrorism Act, and the Financial Intelligence and Anti-Money Laundering Act. While Mauritius does not have a Freedom of Information Act, members of the public may request information by contacting the permanent secretary of the relevant ministry.
Legal System and Judicial Independence
The Mauritian legal system is a unique mixture of traditions. Mauritius draws legal principles from both French civil law and British common law traditions; its procedures are largely derived from the English system, while its substance is based in the Napoleon Code of 1804. Commercial and contractual law is also based on the civil code. However, some specialized areas of law are comparable to other jurisdictions. For example, its company law is practically identical to that of New Zealand. Mauritian courts often resolve legal disputes by drawing on current legislation, the local legal tradition, and by means of a comparative approach utilizing various legal systems. The highest court of appeal is the judicial committee of the Privy Council of England. Mauritius is a member of the International Court of Justice. Mauritius established a Commercial Court in 2009 to expedite the settlement of commercial disputes.
Contracts are legally enforceable and binding on the parties signing the contracts. Ownership of property is enforced with the registration of the title deed with the Registrar-General and payment of the registration duty. Mauritian courts have the jurisdiction to hear intellectual property claims, both civil and criminal. The judiciary is independent and the domestic legal system is generally non-discriminatory and transparent.
Laws and Regulations on Foreign Direct Investment
The Investment Promotion Act of 2000 governs investment in Mauritius and the Companies Act of 2001 contains the regulations governing incorporation of businesses. The Corporate and Business Registration Department (CBRD) of the Ministry of Finance and Economic Development administers the Companies Act 2001, the Business Registration Act 2002, the Insolvency Act 2009, the Limited Partnerships Act 2011, and the Foundations Act 2012. Information regarding the various Acts can be found at the CBRD’s website .
The above-mentioned Acts and all the laws and regulations related to foreign investment can be downloaded from the Board of Investment’s website.
The Mauritian judiciary is independent and the legal system is generally non-discriminatory and transparent. The Embassy is not aware of any cases of government or other interference in the court system affecting foreign investors.
Competition and Anti-Trust Laws
The Competition Commission of Mauritius (CCM) is a statutory body established in 2009 to enforce the Competition Act 2007. This Act established a competition regime in Mauritius, under which the CCM can investigate possible anticompetitive behavior by businesses in the Mauritian market. Since it began operations, the CCM has undertaken 36 investigations, of which 24 have been completed and 12 are still ongoing. The results of completed investigations are available on CCM’s website .
Expropriation and Compensation
The constitution includes a guarantee against nationalization, but the Insurance (Amendment) Act passed in April 2015 enables the government’s Financial Services Commission (FSC) to appoint “special administrators” in cases where there is evidence that the liabilities of an insurer and its related companies exceed assets by MUR 1 billion (USD 28 million) and that such a situation “is likely to jeopardize the stability and soundness of the financial system of Mauritius.” The special administrators are empowered to seize and sell assets. The government enacted this law in the immediate aftermath of the financial scandal explained below.
In April 2015 the Bank of Mauritius, the Central Bank, revoked the banking license of Bramer Bank, the banking arm of Mauritian conglomerate BAI Group, citing an inadequate capital reserve ratio. As a result, Bramer Bank entered receivership and by May 2015 the receiver had transferred the assets and liabilities of Bramer Bank to a newly created state-owned bank, the National Commercial Bank Ltd., thus effectively nationalizing Bramer Bank. In January 2016, the Mauritian government merged the National Commercial Bank Ltd. with another government-owned bank resulting in Maubank, a new bank dedicated mainly to small and medium enterprises.
The government subsequently took over much of Bramer’s parent, the BAI Group. The Financial Services Commission placed the BAI Group in conservatorship, alleging fraud and corporate mismanagement in BAI’s insurance business. Following passage of the Insurance (Amendment) Act in April 2015, the FSC created the National Insurance Company, which took over the BAI Group’s core insurance business, and the National Property Fund, which took over other BAI Group assets, including a hospital and several retail outlets. CIEL Healthcare, a local private company, bought the hospital in January 2017.
In November 2015 BAI’s former chairman filed a dispute against the government of Mauritius with the United Nations Commission on International Trade Law alleging that the government illegally appropriated BAI’s assets. The dispute is ongoing.
ICSID Convention and New York Convention
Mauritius is a member of the International Center for the Settlement of Investment Disputes and a signatory to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards Act. Mauritius is also a member of the Multilateral Investment Guarantee Agency of the World Bank.
Investor-State Dispute Settlement
The Embassy is unaware of any investment dispute involving U.S. investors. However, as explained above, the former chairman of BAI has filed a dispute against the government of Mauritius with the United Nations Commission on International Trade Law alleging that the government illegally appropriated BAI’s assets. Other disputes involving foreign investors include a suit by a local firm (which had bought out its foreign partner) alleging unfair competitive practices by Mauritius Telecom, and a foreign power company’s suit challenging the government’s decision to cancel a proposed energy project.
International Commercial Arbitration and Foreign Courts
In July 2011, the government of Mauritius, the London Court of International Arbitration (LCIA), and the Mauritius International Arbitration Center (MIAC) established a new arbitration center in Mauritius, the LCIA-MIAC Arbitration Center. LCIA-MIAC offers all the services offered by the LCIA in the U.K. The organization’s website has additional information.
In addition, the Mauritius Chamber of Commerce and Industry’s Arbitration and Mediation Center (MARC) is an internationally recognized institution for commercial dispute settlement. MARC’s arbitration and mediation rules are also based on international standards, and it is a member of the International Federation of Commercial Arbitration Institutions. MARC has entered into cooperation agreements with arbitration centers in the United States (American Arbitration Association), Germany, France, Australia, India, and Kenya. More information is available at https://www.mcci.org/en/our-services/mcci-arbitration-and-mediation-center/a>.
Bankruptcy is not criminalized in Mauritius. The Insolvency Act of 2009 amended and consolidated the law relating to insolvency of individuals and companies and the distribution of assets in the case of insolvency and related matters. Most notably, the Act introduced administration procedures, providing creditors the option of a more orderly reorganization or restructuring of a business than in liquidation. A bankrupt individual is automatically discharged from bankruptcy three years after adjudication, but may apply to be discharged earlier. The Act draws on the Model Law on Cross-Border Insolvency adopted by the United Nations Commission on International Trade Law on 30 May 1997. The Act can be accessed through the Board of Investment’s website. According to the World Bank’s 2016 Doing Business report, Mauritius ranks 39th out of 190 countries in “Resolving Insolvency.”