Structuring your investments into Africa Ben Lim, CEO, Intercontinental Trust Ltd Mauritius Investment into Africa Investment into Africa – Tax Haven Using a traditional Tax Haven • African countries known to have high withholding tax rates • No Protection from Double Taxation Agreements • No Protection against Nationalisation or Confiscation of Assets 4 4 Investment into Africa via Mauritius Why use Mauritius for Africa? • Mauritius is part of Africa • • • • • African Union Common Market for Eastern and Southern Africa (“COMESA”) Southern African Development Community (“SADC”) Indian Ocean Rim – Association for Regional Coorperation (“IOR-ARC”) Africa Growth and Opportunities Act (“AGOA”) • Excellent Double Taxation Treaties Network • Bilateral Investment Treaties • Convenient Time Zones / Good Air Connectivity • Dual Legal System – English & French African Investment Funds • Mauritius is the favoured jurisdiction for incorporating African Investment Funds • African Development Bank (“ADB”) recommends Mauritius as an ideal location for the African Funds • Member of the International Organisation of Securities Commissions (“IOSCO”) • Over 600 Funds incorporated in Mauritius • Modern legislation covering CIS and Fund Managers/Advisers Mauritius – Recent Awards Index Organisation Africa World Ease of Doing Business World Bank 1st 17th Economic Freedom Heritage Foundation 1st 12th Easiest Country for Trade World Economic Forum 1st 33rd Top Regional Reformer World Bank 1st Most Improved Investment Climate African Business Awards 1st Best Governed Country in Africa Harvard University 1st Ibrahim Index Mo Ibrahim Foundation Kennedy School of Governance 1st Europe In Negotiation • Belgium • Cyprus • Croatia • France • Germany • Italy • Luxembourg • Sweden • UK • Russia* • Canada** • Czech Republic** • Greece** • Portugal** • Iran** • Burkina Faso** • Algeria** • Yemen** • Ghana** • Saudi Arabia** Asia Middle East • Kuwait • Oman • United Arab Emirates • Qatar • Bangladesh • China • India • Malaysia • Nepal • Pakistan • Singapore • Sri Lanka • Thaïland • Vietnam* Africa Caribbean region • Botswana • Lesotho • Madagascar • Mozambique • Namibia • Rwanda • Senegal • Seychelles • South Africa • Swaziland • Tunisia • Uganda • Zimbabwe • Egypt* • Kenya* • Malawi* • Nigeria* • Zambia* • Barbados Treaty Network: 36 DTAAs in force * 7 Treaties awaiting signature or ratification ** 10 Treaties being negotiated DTAs with African Countries Countries Dividends Interest Royalties PE 5/10% 12% 12.5% 6m 10% 10% 10% 6m Madagascar 5/10% 10% 5% 6m Mozambique 8/10/15% 8% 5% 6m Namibia 5/10% 10% 5% 6m Rwanda - - - 12m Senegal - - - 9m Seychelles - - - 12m South Africa 5/15% - - 9m Swaziland 7.5% 5% 7.5% 6m Tunisia - 2.5% 2.5% 12m Uganda 10% 10% 10% 4/6m 10/20% 10% 15% 6m Botswana Lesotho Zimbabwe Africa • Madagascar • Mozambique • South Africa • Benin* • Botswana* • Burundi* • Cameroon* • Chad* • Comores* • Ghana* • Guinea Republic* • Mauritania* • Rwanda* • Senegal* • Swaziland* • Zimbabwe* Europe • Belgium • Czech Republic • France • Germany • Ireland • Luxembourg • Portugal • Romania • Switzerland • UK Asia • China • India • Korea • Nepal • Pakistan • Singapore Investment Promotion and Protection Agreements 20 Fully Operational, 13 *Awaiting Ratification Carribean Region • Barbados Investment Promotion & Protection Agreement (“IPPA”) • Covers every kind of asset • • Non-Discrimination • • Treatment of Investments. Compensation of losses owing to war / other armed conflict Expropriation • • Right to Compensation Disputes between Investor and Contracting Party • • Provision for International Arbitration after 6 months Disputes between Contracting Parties • • Includes concessions to search for, cultivate, extract or exploit natural resources Provision for an Arbitral Tribunal Retroactive Corporate Vehicles Global Business Companies (“GBC”) • Category 1 – Tax Treaty Company (“GBC1”) • Category 2 – Tax Exempt Company (“GBC2”) Activities • • • • • Holding Companies Investment Funds Asset Management Companies Private Trusts Trading Companies Set up a Mauritius Company Incorporation • Two weeks • Regulated by Financial Services Commission Re-domiciliation (Migration) • Most offshore jurisdiction allow companies to migrate out • Effective way to continue the company to Mauritius • Immediately after re-domiciliation, the company can take advantage of the • DTAAs • Investment Protection Agreements Redomiciliation of Companies Countries Allowing Re-domiciliation Andorra BVI Ireland Maldives Seychelles Anguilla Brunei Isle of Man Malta St Kitts & Nevis Antigua Cayman Israel Marshall St Lucia Aruba Cook Jersey Mauritius St Vincent Austria Costa Rica Latvia Montserrat Switzerland Bahamas Cyprus Lebanon Nauru Turks Caicos Bahrain Dominica Liberia Neth. Antilles UAE Dubai Barbados Gibraltar Liechtenstein Panama Uruguay Belgium Grenada Luxembourg Philippines US Virgin Belize Guernsey Macao Madeira USA Delaware Bermuda Hungary Labuan Samoa Vanuatu Tax Residence A Company is tax resident in Mauritius if it is either: • Incorporated in Mauritius; or • Managed and controlled from Mauritius Conditions to obtain a Tax Residence Certificate (“TRC”): • • • • • • • Two local directors Local company secretary Local auditor Board meetings chaired from Mauritius Statutory records kept in Mauritius Accounting records kept in Mauritius Principal bank account in Mauritius TRC country specific and renewed yearly Tax in Mauritius •No Capital Gains Tax •No Profits on Sale of Shares •Maximum Corporate Tax of 3% (Most companies pay zero tax) •No Withholding Tax on payments from Mauritius •Advance Tax Rulings •Whitelisted by OECD •No Exchange Controls Intercontinental Trust Ltd • Intercontinental Trust has been in existence for over ten years • Licensed and Regulated by the Financial Services Commission • Principals have been active in this industry for over 15 years • Over 100 staff • Active participation in the legal and regulatory reform process of the financial services sector in Mauritius • Among the leading Trust Companies in Mauritius 19 Services • Incorporation & Administration of Companies • Fund Formation and Administration • International Tax Planning • Trustee Services • Accountancy Services • Business Process Outsourcing 2020 SAS 70 •Intercontinental Trust Ltd and its subsidiaries recently obtained their SAS 70 Type II certificate •Audit Report Unqualified by PricewaterhouseCoopers •One of the first trust companies to have SAS 70 Type II 2121 Thank You