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Mauritius – New Limited Partnership Structure

by Sable International | Sep 09, 2016
  • The Limited Partnerships Bill 2011 was approved in Parliament in late 2011 and is expected to be approved by the President of the Republic shortly. This new legislation has long been awaited by professionals in the funds industry and it will attract significant interest for setting up new fund structures with a limited partnership ("LP") structure. This new vehicle will be useful in ensuring tax efficient and transparent fund structures.

    A LP offers flexibility for the general partners in terms of capital and profit distributions and as regards the general administration of the LP structure. LPs are principally established for investment purposes and are a favoured structure for use in private equity and venture capital schemes, collective investment schemes, structuring joint ventures, holding property interests, estate planning, asset protection and tax and financial planning. General Partners have the ability to manage operations from locations other than Mauritius.

    A Mauritian LP vehicle may hold a Category 1 Global Business Licence issued by the Financial Services Commission and can be structured to benefit from the network of double taxation avoidance agreements which Mauritius has with 36 countries. The LP may seek authorisation from the FSC to operate as a Collective Investment Scheme under the Securities Act 2005 and the Securities (Collective Investment Schemes and Closed-End Funds) Regulations 2008. Other regulatory consents may be required depending on the type of activities the LP will be undertaking.

    Every general partner and limited partner of a LP structure holding a category 1 global business licence under the Financial Services Act 2007 will be liable to income tax in respect of its share of income in that LP. However, a Mauritian LP may hold a global business licence and may elect to be taxed in Mauritius and thus take advantage of the Mauritius tax treaty benefits.

    Roderick Phillips CA(SA) is Managing Director of Sable Offshore Management Company Ltd, licensed and regulated by the Financial Services Commission in Mauritius. For more information www.sable.mu

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