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Introduction of the Financial Services (Global Shared Services) Rules 2022

By February 3, 2023 No Comments
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The Mauritius IFC has time and again proven its worth as a well-regulated and innovative financial centre, gaining momentum through the introduction of highly coveted financial activities, and the ensuing sound regulatory frameworks that govern them.

2018 was considered a turning point within the financial services landscape, where the MIFC was undergoing major legislative changes, and at the same time, consequential efforts were being made to further diversify the sector’s service offering. Amid announcements of new frameworks for Regulatory Sandbox and Custodian of Digital Assets, as well as the phasing out of the GBC2 regime, foraging for opportunities vis a vis global Groups – parent companies with affiliates and subsidiaries – also came to the forefront, and the Government brought to light in its 2018/2019 Budget Speech the introduction of a new type of activity, Global Shared Services, in Mauritius.

At its core, Global Shared Services entail the provision of certain facilities by a regulated financial services company to its related entities – i.e., entities which form part of the same Group as the entity providing Global Shared Services – in an effort to promote centralised business operations and mainstreamed strategies.

In a bid to further push for a more transparent regulation of this type of activity, the FSC released consultation papers in 2019 and on 3 January 2023, the Financial Services (Global Shared Services) Rules 2022 (hereinafter referred to as the “Rules”) came into operation.

We list out in this newsletter the conditions applicable for holders of Global Shared Services licence and the main features of the Rules.

CONDITIONS APPLICABLE FOR AN ENTITY PROVIDING GLOBAL SHARED SERVICES

According to the Rules, a holder of a Global Shared Services licence shall provide for 3 or more of the services described in the Sixth Schedule of the Financial Services Act (the “Act”), listed below, and shall not engage in any other services or activities other than those described in the Schedule:

• Record keeping
• Financial Statements preparation
• Invoicing and Payments of Bills
• Periodic Regulatory fillings
• Administration of Board proceedings
• Tax Support Services
• Debt Collection
• Data Capture and Reporting
• Other services as may be approved by the FSC

The entity must be further incorporated in Mauritius and shall not have any other licence, authorisation, registration or approval under relevant acts, except as approved by the FSC.

The Rules apply to any entity providing Global Shared Services to its related entity which is engaged in the provision of financial services outside of Mauritius.

In addition, the Rules shall not apply to a holder of a Management Licence issued under section 77 of the Act.

OTHER REQUIREMENTS OF THE GLOBAL SHARED SERVICES COMPANY

The above list should not be considered exhaustive as the FSC is liable to impose other conditions, as it deems appropriate, upon the issue of the licence.

Following commencement of the Rules, entities which are already providing Global Shared Services will have until 3 July 2023 to apply for the licence.

You can consult the Rules here for more information.

If you have any question on the Financial Services (Global Shared Services) Rules 2022 or you require assistance in submitting your application, please get in touch with your usual contact person at ITL or write to us on [email protected]