Mauritius held $44.6 billion of outward direct investment positions in African economies at 30 June 2025, according to the Financial Services Commission’s coordinated survey track published with Bank of Mauritius CDIS materials. That figure, down from a peak of $49.0 billion a year earlier, sits atop a decade-long arc: the African book nearly tripled from $15.5 billion in 2012, plateaued through 2023, and has since eased.
Context matters. Africa accounts for 12.6 per cent of the Mauritius global business outward book. India, at 50.1 per cent, dwarfs it. Mauritius is an India conduit first and an Africa conduit second, and any honest reading of the numbers starts there.
This article examines what the Mauritius structuring channel does, what it now requires, where it has come under pressure, and what has changed since the scrutiny of 2019. For founders weighing how capital actually moves across borders, it sits alongside our work on startup fundraising mechanisms and angel investing lessons for African startups.
What the numbers show
The FSC’s Coordinated Direct Investment Survey track follows the outward positions of Mauritius global business companies by counterpart economy. The African book has followed a clear shape: steady growth from 2012 to 2019, a sharp rise through 2021 and 2022, a peak in mid-2024, and a mild contraction since.
The book is concentrated. South Africa, Mozambique, Nigeria and Kenya together account for roughly half the African total. The top ten destinations at mid-2025 are shown below.
Why the structure gets used
Three practical reasons keep recurring in cross-border African deals.
First, treaty access. Mauritius maintains a network of double taxation agreements that, where in force and where substance conditions are met, can reduce withholding friction on dividends, interest and royalties. The Mauritius Revenue Authority’s international taxation pages set out the current network and how the Multilateral Instrument reshapes it.
Second, a regulatory toolkit that continues to evolve. The Variable Capital Companies Act 2022 introduced an umbrella vehicle whose sub-funds carry ring-fenced assets and liabilities. Uptake has been rapid: from 13 live VCC funds at the start of 2024 to 194 by mid-2026, alongside 13,341 active global business companies and 864 global funds on the FSC register.
Third, administrative convenience. A common-law legal system, English-language courts, and a time zone that overlaps both African and Asian business hours make the jurisdiction operationally practical for firms working across borders. That convenience is why structuring questions often appear next to equity and incentive design for early African teams and, increasingly, next to tokenisation readiness debates when investors ask where a holding company should sit.
What substance now requires
The substance test is statutory, not guidance. Section 71 of the Financial Services Act 2007 requires a global business licence holder at all times to carry out its core income generating activities in or from Mauritius, be managed and controlled from Mauritius, and be administered by a management company.
The Commission assesses management and control against five indicators: at least two directors resident in Mauritius of sufficient calibre to exercise independent judgement; a principal bank account in Mauritius; accounting records at the registered office; statutory financial statements audited in Mauritius; and board meetings that include at least two Mauritius-resident directors.
Favourable tax treatment, including the partial exemption on qualifying foreign-source income, is conditional on meeting these substance conditions. Falling short means the exemption may not apply.
The 2018 to 2019 reform abolished the old two-tier licensing regime and the deemed foreign tax credit, which had been the most commonly criticised feature of the earlier system. What replaced it is a framework where the tax benefit is tied to demonstrated economic activity, not to the licence category. The MRA’s note on the Multilateral Instrument explains how the principal purpose test now sits across covered treaties.
Where the treaty network has broken
Not every treaty relationship has held. Senegal terminated its agreement in January 2020, citing government estimates of revenue lost since 2004. Zambia’s cabinet moved in mid-2020. Both terminations followed sustained campaigning by tax justice organisations and investigative reporting. Nepal’s termination, the most recent, took effect in mid-2026.
In Kenya, the original treaty was struck down by the High Court on procedural grounds in March 2019 after a petition by Tax Justice Network Africa. A replacement was signed the following month but, per the Mauritius Revenue Authority, still awaits ratification.
The pattern is not always terminal. Both Senegal and Zambia now appear on the MRA’s “under negotiation” list, suggesting the relationship is being renegotiated rather than abandoned. Rwanda terminated in 2012 and re-entered into a replacement treaty that is in force today.
Perhaps the most telling data point is the Zambia line in the investment figures above. Five years after the treaty lapsed, 252 Mauritius global business companies still hold $1.4 billion of position in the country. The treaty was evidently never the sole reason the structure was used.
The reputational question
The ICIJ published its Mauritius Leaks investigation in July 2019, based on more than 200,000 documents. Its central charge was that the jurisdiction had allowed multinationals to route investments through resident shell companies to avoid substantially higher taxes in other countries.
Three things have changed since. The 2018 to 2019 reform replaced the two-tier licensing system with substance-dependent tax treatment. The OECD’s Multilateral Instrument entered into force for Mauritius in February 2020, embedding a principal purpose test that denies treaty benefits where obtaining the benefit was one of the principal purposes of an arrangement. And the Finance Act 2025 introduced a qualified domestic minimum top-up tax at 15 per cent for constituent entities of multinational groups with consolidated revenue above EUR 750 million, aligning with the Pillar Two framework. Most global business companies fall well below that revenue bar, but the legislative direction is clear.
On international standing: Mauritius was placed on the FATF grey list in February 2020 and removed in October 2021. It appeared on the EU anti-money-laundering list from October 2020 to February 2022. It was never placed on the EU’s list of non-cooperative jurisdictions for tax purposes, a distinction that gets conflated frequently in commentary. The U.S. State Department’s 2025 Investment Climate Statement for Mauritius remains a useful external summary of the investment framework, with the usual caveat that climate statements lag legislative updates.
None of this erases the history. But the regime the leaked documents described is not the regime that exists today. For operators building African growth companies, the practical question is the same one that shows up in fintech infrastructure debates: whether the holding layer reflects real activity, or merely hopes that paperwork will do the work.
How to think about whether it fits
Whether a Mauritius structure adds value depends on questions specific to each investment. Does the underlying deal span jurisdictions where treaty access reduces friction? Can the holding company demonstrate genuine core income generating activities, not just a registered address? Are the compliance and administration costs justified by the scale of the investment?
Recent legislative changes, including the qualified domestic minimum top-up tax and the evolving alternative minimum tax framework, mean the answers now depend on facts that most investors will not have to hand without professional advice in the relevant jurisdictions.
What has not changed is the underlying test. A Mauritius structure must reflect real economic activity and clear governance. Where it does, the jurisdiction offers a workable and well-regulated platform for cross-border investment into Africa. Where it does not, the regulatory and reputational risks have only grown.
Key takeaways
- Mauritius GBCs held $44.6 billion of investment positions in African economies at mid-2025, down from a peak of $49.0 billion in 2024
- Africa accounts for 12.6 per cent of the outward book; India, at 50.1 per cent, is the dominant corridor
- Substance requirements are statutory: core income generating activities, management and control from Mauritius, and administration by a management company
- Three African treaties have been terminated, but investment positions have persisted without them
- Regime reforms since 2019, the MLI principal purpose test, and the 2025 minimum tax have materially changed the framework
FAQ
Does a Mauritius holding company automatically provide treaty access to African markets?
No. Treaty access depends on the company meeting the substance requirements under section 71 of the Financial Services Act 2007, and on passing the principal purpose test embedded in the treaty network since the Multilateral Instrument entered into force in February 2020. A company that exists on paper only will not qualify.
What changed after the ICIJ Mauritius Leaks investigation?
The regime underwent three structural changes. The 2018 to 2019 reform abolished the old two-tier licence system and the deemed foreign tax credit. The OECD Multilateral Instrument entered into force for Mauritius in February 2020, adding a principal purpose test to the treaty network. And the Finance Act 2025 introduced a qualified domestic minimum top-up tax at 15 per cent for multinational groups with consolidated revenue above EUR 750 million. Mauritius was also removed from the FATF grey list in October 2021 and the EU anti-money-laundering list in February 2022.
Can a Mauritius structure function without a tax treaty in the target market?
The data suggests it can. Zambia terminated its treaty with Mauritius in 2020, yet 252 global business companies still hold $1.4 billion of investment position there as of mid-2025. Treaty access is one benefit of the structure, but regulatory predictability, a common-law legal system, and administrative convenience provide value independently.
What is the difference between a global business company and an authorised company?
A global business company holds an FSC licence and, subject to meeting substance conditions, can access Mauritius tax treaties and the partial exemption on qualifying income. An authorised company, introduced when the old two-tier regime was abolished in 2019, is a non-resident vehicle without treaty access. The choice depends on whether the investment requires treaty benefits.
How does Mauritius structuring relate to African startup fundraising?
Founders and investors often meet at the holding-company layer: a GBC can sit above operating companies when the capital stack spans several African markets. It does not replace local company law, equity design, or fundraising mechanics on the ground.
Sources
- Bank of Mauritius / FSC Mauritius CDIS materials, Value of Investment (Dec 2012 – Jun 2025), CDIS Outward / ESSNAC survey track, published January 2026
- Mauritius Revenue Authority, Double Taxation Agreements / International taxation
- U.S. Department of State, 2025 Investment Climate Statement for Mauritius, September 2025
- Financial Services Commission Mauritius, monthly and register data on global business licences and funds, 2013–2026
- International Consortium of Investigative Journalists, Mauritius Leaks, 23 July 2019
- Mauritius Revenue Authority, The Impact of the Multilateral Instrument (MLI) on the Mauritius Tax Treaties, June 2024
- FATF, Mauritius exit from the grey list, October 2021
- Financial Services Act 2007 (Mauritius), section 71
Disclaimer. This article is published for informational and educational purposes only. It does not constitute legal, tax, or investment advice, and should not be relied upon as such. Regulatory and tax positions described in this article may have changed since the date of publication. Readers considering cross-border investment structures should obtain independent professional advice in Mauritius and in every source and investor jurisdiction involved.
