07/07/2021
Mauritius on its way to be removed from the FATF grey List
The Financial Action Task Force, during the plenary session came to the initial conclusion that Mauritius has substantially completed its action plan and that there should be an on-site assessment to verify that the implementation of Mauritius’s AML/CFT is being sustained.
The FATF wants to assess in situ that the necessary political commitment remains in place to sustain implementation of necessary reforms to combat money laundering and the financing of terrorism in the future. It was concluded that Mauritius has made the following key reforms:
conducting outreach to promote understanding of ML and TF risks and obligations.
developing risk-based supervision plans effectively for the Financial Services Commission;
ensuring access to accurate basic and beneficial ownership information by competent authorities in a timely manner; and
providing training for law enforcement authorities to ensure that they have the capability to conduct money laundering investigations.
The task force is monitoring the situation and announced that the on-site visit will be conducted as soon as possible and we can effectively be removed from the list of monitored jurisdiction in October 2021.
What does this entail?
The announcement, that Mauritius has put in place the key reforms required by FATF, will have a very positive effect on the growth of the financial services sector. Presently, all funds and transaction from Mauritius are subject to enhanced due diligence. This has a negative effect on businesses that wants to set up in Mauritius, because it increases the cost of compliance, and put undue pressure on management teams who would need to justify even small payments to banks the companies work with.
With the removal of Mauritius from the list, transactions will be subject to normal due diligence, less costly, less time consuming, and more conducive for businesses. For corresponding banks as well, there will be less issues with Mauritian banks.
For investment advisors, investment dealers, this will be very good news, as local banks will be more inclined to open bank accounts, especially clients’ account, and business can be conducted seamlessly.
Overall, Mauritius will be then considered as an equivalent jurisdiction with all the important international financial centers.
Conclusion
Mauritius will be again a country where doing business will be attractive. Specially with fiscal incentive announced in the budget, for example investment advisors and family offices will benefit from extended tax holidays, and Investment dealers will fall under the partial exemption regime. With occupational permits extended and minimum cost of acquiring a residence for residence permit purposes down, and incentive for innovators, Mauritius is now more than ever ready to attract the next generation of businesses.
