A new set of rules under the Special Purpose Fund (SPF) regime has been released by the Mauritius Financial Services Commission (FSC) to provide further flexibility and ease access to new markets.
The Mauritius National Budget which included the modernizing of the existing Special Purpose Fund (SPF) regime to provide further flexibility and ease access to new markets. The objective of the upgraded SPF rules is to offer a tax-exempt entity having economic substance in Mauritius to further attract international fund promoters and managers wishing to avail of modern securities laws and overall fund logistics with globally competitive cost structures. This benefit both manager and the investor with respect to the set-up and ongoing operations and maintenance of fund structures.
Requirements for Authorization As A Special Purpose Fund
Any scheme may apply to the Commission under these Rules for an authorization as a special purpose fund, subject to any conditions as may be imposed by the Commission and the FSC Rules.
A special purpose fund shall offer its shares, solely by way of private placements, to investors having competency, significant experience and knowledge of fund investment and have a maximum of 50 investors and a minimum subscription of USD 100,000 per investor. However, it should always also be managed by a Collective Investment Scheme (CIS) manager and administered by a CIS administrator and comply with any such other conditions as may be imposed by the Commission.
The special purpose fund, the CIS manager and the CIS administrator shall carry out their relevant core income generating activities in, or from, Mauritius, and shall employ, directly or indirectly, an adequate number of suitably qualified persons to conduct such core income generating activities; and incur a minimum expenditure proportionate to the level of such activities.
Withdrawal As A Special Purpose Fund
The Commission may, without prejudice to any other enactment, after having considered the representations made by a scheme, withdraw the authorization of the scheme as a special purpose fund where the Commission has reason to believe that any of the requirements or conditions referred to or otherwise imposed by the Commission are no longer satisfied.
The Commission may also in withdraw the authorization if it is undesirable in the interests of the participants or potential participants that the scheme should continue to be approved as a special purpose fund or the scheme has, knowingly submitted information which is false and misleading. The Commission however may consider any matter relating to the scheme, the CIS manager or the custodian, an officer or controller of the CIS manager, or any person employed by or associated with the CIS manager in connection with the scheme.
Subject to any enactment, an authorization to operate a special purpose fund shall terminate, upon the approval of the Commission, on the date as specified by the resolution. Any scheme, approved as a special purpose fund shall be exempted from the provisions of section 106 of the Securities Act which states that Every collective investment scheme shall file with the Commission and make public interim financial statements prepared in accordance with IFRS and such other standards as may be issued under the Financial Reporting Act 2004, as soon as possible, but not later than 45 days after the closing date of the interim period specified in FSC Rules.
Any Scheme approved as a special purpose fund shall also file its audited financial statements with the Commission in accordance with section 30 of the Financial Services Act which states that a corporation licensed under this Act shall file with the Commission every year audited financial statements prepared in accordance with International Financial Reporting Standards.
Saving and Restrictions Rules shall not apply to collective investment schemes and closed-end funds authorized before the commencement of these Rules.
The Special Purpose Fund (SPF) regime was put in place by the Financial Services Commission to provide further flexibility and ease access to new markets. The rules put in place with the intention of providing flexibility and global competitive cost structures.
How Can We Help?
At Valsen Fiduciaries Group, our experienced staff, combined with our global network, allow us to provide the ongoing support you need – wherever you need it, at home and abroad, whatever the size of your organisation. We are at your disposal to discuss the New Special Purpose Fund Rules to help your business grow. Please contact us through [email protected] or +248 2 525 217