Closed-End Fund in Mauritius
Private equity, venture capital, and real estate fund structures.
A closed-end fund in Mauritius is an investment vehicle with a defined term and no regular redemption rights. Investors make capital commitments at the outset which are drawn down over the investment period as opportunities arise, and capital is returned through distributions during the fund's life and at final wind-up. Closed-end funds are licensed by the Financial Services Commission under the Securities Act 2005 and the Financial Services Act 2007, and are the dominant structure for private equity, venture capital, real estate, infrastructure, and credit strategies.
Mauritius is one of the most popular domiciles in the world for funds targeting Sub-Saharan Africa and South Asia, leveraging its network of 45 double taxation agreements in force (MRA, 2026), its absence of capital gains tax, and its regulatory credibility with institutional investors. The Limited Partnership is the most commonly used vehicle for closed-end funds, providing tax transparency — income flows through to investors without entity-level tax — and a familiar governance structure for private equity fund managers and their institutional LP bases. Alternatively, a GBC company or Variable Capital Company (VCC) can be used where a corporate structure is preferred.
Our team advises on vehicle selection, regulatory category, tax structuring, document preparation, and FSC licensing, as well as ongoing fund administration throughout the fund's life.
Key Features of a Closed-End Fund in Mauritius
Fixed Term and Capital Commitment Structure
Investors commit capital at first close, which is drawn down as investments are identified. Capital is returned through distributions as investments are realised. The fixed term — typically 7–10 years with extension options — aligns the manager's incentives with investor returns.
Limited Partnership Vehicle
The Mauritius Limited Partnership is the most popular closed-end fund vehicle, offering tax transparency (income flows directly to partners without fund-level tax), limited liability for LPs, and a familiar governance framework for institutional private equity investors.
No Capital Gains Tax
Mauritius does not levy capital gains tax on the disposal of investments. This is a major advantage for private equity and venture capital funds, where returns are primarily generated through capital appreciation on portfolio company exits rather than regular income.
Africa and Asia DTA Gateway
Mauritius has double taxation agreements with key African and Asian investment markets. For a private equity fund investing in these markets, the DTA network can reduce withholding taxes on dividends and capital gains, directly improving net returns to investors.
FSC Regulation and Institutional Credibility
FSC licensing provides institutional credibility — pension funds, development finance institutions, family offices, and endowments routinely invest in Mauritius-domiciled closed-end funds. The FSC's regulatory oversight gives institutional LPs confidence in the fund's governance.
Flexible Investor Classes
Multiple LP classes can be created within a single fund to accommodate different investor types — GP co-investment, anchor investors, development finance institutions — with different economics, information rights, or governance protections.
Variable Capital Company (VCC) Option
For managers running multiple strategies or vintage funds, the Mauritius VCC allows multiple sub-funds under one legal entity with legally segregated assets and liabilities, reducing formation costs and operational complexity.
Carried Interest Structuring
We advise on the structuring of carried interest for the general partner or investment manager, optimising the tax treatment of performance-related returns within the Mauritius tax framework and applicable double taxation agreements.
Fundraising and First Closing Support
We assist with operational support during the fundraising period, including investor KYC processing, subscription document management, first closing mechanics, and co-ordination of capital call procedures.
SEM Listing Option
Closed-end funds can be listed on the Stock Exchange of Mauritius (SEM), providing additional visibility, a secondary market for LP interests, enhanced governance credibility, and potential access to a broader institutional investor base.
How to Set Up a Closed-End Fund in Mauritius
Investment Strategy and Fund Terms
We work with the fund manager to finalise the investment strategy, target sectors, geographic focus, fund size, investment period, fund life, management fee, carried interest, preferred return, and GP commitment — the key economic terms that will be set out in the LPA or constitutional document.
Vehicle and Regulatory Category Selection
We recommend the optimal vehicle — Mauritius Limited Partnership, GBC company, or VCC — and the appropriate FSC regulatory category (Closed-End Fund or Expert Fund), considering the investor base, tax structuring objectives, and governance requirements.
Tax Structuring and DTA Analysis
We analyse the fund's target investment markets and advise on the optimal structure to access DTA benefits, minimise withholding tax on investment income and exit proceeds, and optimise the treatment of carried interest and management fees.
Document Preparation
We coordinate the preparation of the private placement memorandum (PPM), limited partnership agreement (LPA) or constitutional documents, subscription documents, side letter templates, and all required regulatory application materials.
Service Provider Appointment
We assist with appointing the fund's auditor, custodian (where required), legal counsel, and placement agent. We help negotiate and execute service provider agreements, ensuring all regulatory requirements are satisfied.
FSC Licence Application
We compile and submit the complete fund licence application to the FSC, managing all queries and providing progress updates. We coordinate all KYC submissions for promoters, GP personnel, and other key parties.
Fundraising Operational Support
During the fundraising period, we manage investor subscriptions and KYC, process capital commitments, coordinate first and subsequent closings, and prepare capital call notices as the manager begins investing committed capital.
Ongoing Fund Administration
We provide full fund administration throughout the fund's life — accounting, financial reporting, investor reporting, capital account statements, distribution notices, regulatory filings, and coordination with the auditor at each year-end.
Requirements for a Closed-End Fund in Mauritius
- Detailed investment strategy, target sectors, and geographic focus
- Proposed fund terms: target size, investment period, fund life, management fee, carried interest, preferred return
- KYC documentation for all promoters, general partners, and key investment personnel
- Track record of the investment manager or general partner (investment history and performance data)
- Details of any anchor investors or first-close commitments
- Draft term sheet, PPM outline, or heads of terms
- Proposed legal counsel and auditor (or request for assistance in selecting)
- Details of any regulatory licences held by the investment manager in other jurisdictions
- Organisational chart of the fund management group and affiliated entities
- Details of any existing funds under management for ongoing relationship context
Estimated Costs of a Closed-End Fund in Mauritius
| Item | Estimated Range |
|---|---|
| Fund structuring advisory and FSC application | USD 5,000 – 15,000 |
| PPM and LPA preparation (legal) | USD 15,000 – 40,000+ |
| FSC licence fee (government) | USD 1,000 – 5,000 |
| Annual fund administration | USD 15,000 – 50,000 |
| Annual audit fee (estimated) | USD 8,000 – 25,000+ |
| Annual FSC regulatory fee | USD 1,000 – 4,000 |
Frequently Asked Questions About Closed-End Fund in Mauritius
What is the typical fund life for a closed-end fund?
The typical fund life is 7–10 years, consisting of a 3–5 year investment period followed by a harvesting or divestment period. Extensions of 1–2 years are common and are typically subject to approval by the advisory committee or a specified majority of investors by commitment. The fund life and extension mechanics are set out in the LPA.
Why domicile a private equity or venture capital fund in Mauritius?
Mauritius offers several compelling advantages: a DTA network covering key African and Asian investment markets, no capital gains tax, FSC regulation providing institutional credibility, a familiar Limited Partnership structure, a cost-effective operating environment, and a track record as an established domicile for PE and VC funds. Development finance institutions and institutional LPs with Africa or Asia mandates are familiar with Mauritius-domiciled funds.
Can a closed-end fund be listed on the Stock Exchange of Mauritius?
Yes. Closed-end funds can be listed on the Stock Exchange of Mauritius (SEM), providing LP interests with a secondary market, improving governance transparency, and potentially broadening the investor base. Listing requirements include minimum capital, governance standards, and ongoing disclosure obligations. We advise on the listing process in coordination with the SEM.
What is the difference between a closed-end fund and a CIS?
A CIS (open-end fund) allows investors to subscribe and redeem at NAV on regular dealing days, providing liquidity. A closed-end fund has a fixed term and no regular redemptions — investors commit capital for the fund life. Closed-end structures are appropriate for illiquid assets such as private equity, real estate, and infrastructure, where assets cannot easily be sold on short notice to meet redemption requests.
How is carried interest taxed in Mauritius?
Carried interest received by a Mauritius general partner or investment management entity may be subject to the 15% corporate tax rate. The specific tax treatment depends on the legal form of the GP entity, its tax residency, and the nature of the income. GBC-licensed entities may benefit from the partial exemption system on certain income categories. Professional tax advice is essential for carried interest structuring.
What capital call mechanics are used?
Capital calls are issued by the GP to LPs in accordance with the capital call notice provisions of the LPA. The notice period is typically 5–10 business days. We administer the capital call process — preparing and distributing notices, tracking committed capital, recording drawdowns, and updating capital accounts. Uncalled capital remains with the LP until called.
Can the fund make distributions before the end of its life?
Yes. Distributions to LPs are made during the fund's life as investments are realised. The distribution waterfall — the order in which proceeds are distributed between LPs and the GP — is set out in the LPA. Common structures include a straight deal-by-deal waterfall or a whole-fund waterfall with preferred return and carried interest provisions.
What reporting do LPs receive?
LPs typically receive: quarterly management accounts and portfolio updates, annual audited financial statements, annual capital account statements, capital call notices and distribution notices as they occur, and any material notices required under the LPA or FSC regulations. We produce all LP reporting as part of our fund administration service.