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Amendments In The Law Affecting Global Business Brought By The Finance Act 2010
The Finance (Miscellaneous Provisions) Act 2010 ("the FA 2010") reiterates and implements the different measures announced in the 2010 Budget by amending different enactments and legislations. Taxand Mauritius analyses the changes brought about by the FA 2010.
Following the amendment, the scope for Category 1 Global Business Licence Company (GBC1) has been expanded to extend their operations to the domestic economy. GBC1s are now allowed to conduct business both inside and outside Mauritius. From a tax perspective, this implies that with regard to their foreign operations, GBC1s will continue to benefit from foreign tax credits while for their domestic operations they will pay the same tax as other domestic corporate entities.
GBC1s were previously permitted to have limited dealings and transactions with residents of Mauritius the FSA. With the inclusion of certain sections in the FSA, GBC1s are now allowed to deal with individuals domiciled in Mauritius or companies incorporated in Mauritius without any restriction.
Further, under the FSA, GBC1s were allowed to hold shares, debentures, security or any interest in other corporation holding a Global Business Licence only. This provision has now been broadened to allow GBC1s to hold shares or other interests in corporations resident in Mauritius.
The rationale behind registration and filing of the share transfer form is mainly for fiscal purposes i.e. to levy taxes upon any transfer of share of companies which have, among their assets, immovable property in Mauritius. As a general rule, once the transfer of shares is attached to an immovable property in Mauritius, then registration duty is payable and the share transfer form would need to be executed and registered with the Registrar General.
A company holding shares that does not have any freehold or leasehold immovable property in Mauritius would be exempt from registering a share transfer form under the RDA. However, the Companies Act 2001 states that "a company shall not enter a transfer of shares or debentures in the share register or the register of debenture holders unless a valid instrument of transfer has been delivered to the company in the form required the Registration Duty Act has not yet been amended to reflect the changes effected under the RDA by the Finance Act 2010.
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