Mauritius Foundation

Foundations are commonly used in common law countries and can be described as a blend of Trust and Company.  In Mauritius the concept of Foundation emanates from the Mauritius Foundation Act 2012. Interestingly a Foundation is in many respects similar to a Company on one hand and also benefit from the protection and continuity derived from the use of a trust on the other hand.

A Foundation is a very good alternative vehicle to Trust and is convenient for succession planning and private wealth management. Foundations are an important tool when structuring the ownership of family and corporate assets and are crucial in countries where trusts are not generally recognized. In jurisdictions where the concept of trusts is less well known, Foundations are being used increasingly.

A Foundation has no members or shareholders as a company but is in most cases established to reflect the wishes of the founder, who may be an individual or a corporate entity. These wishes are included within its statutory documents, called the Foundation’s Charter and Regulations. Foundations can be established for a fixed or indefinite period of time and can be used for charitable, commercial or family purposes. A Foundation may upon application to the Financial Services Commission of Mauritius, hold a global business licence and may elect to be tax resident in Mauritius to benefit from the wide network of Double Taxation Agreements (“DTAs”) in force in Mauritius.

Where are Foundations used?
  • Private relationship: For example, the founder’s wishes are not publicly registered;
  • Accumulation and preservation of wealth;
  • Succession and estate planning;
  • Separation of voting and economic benefits;
  • Employee share option schemes;
  • Pension funds;
  • Charitable purposes;
  • International tax planning.
Types of Assets that can be Held by a Foundation
  • Shares and stocks in both listed and private companies;
  • Investment portfolios;
  • Real estate;
  • Intellectual property;
  • Bank deposits;
  • Most other types of assets.
The salient features of the Mauritius Foundation are as follows:
  • It could be set-up intervivos (by Charter) or by Will;
  • It could be set-up to benefit persons, class of persons or to carry out a purpose which may be charitable, non-charitable or both;
  • It would have to be managed by a Council which should comprise of at least one member ordinarily resident in Mauritius;
  • It would require a secretary in Mauritius which would need to be licensed by the Financial Services Commission;
  • It would need to have a registered office in Mauritius;
  • When registered it would have a separate legal personality;
  • It would need to keep proper books of accounts and keep its records in Mauritius at its registered office;

Where the founder and all the beneficiaries are non-resident (or if set-up for a purpose, that purpose being carried out of Mauritius) it would be exempt from tax in Mauritius.