STRUCTURING PRIVATE EQUITY INVESTMENTS THROUGH MAURITIUS SONIA XAVIER Associate BERMU Conyers Dill Pearman (Mauritius) Limited ms? Conyers Dill Pearman s; PAU L0 CO PRIVATE EQUITY INVESTMENTS INTO AFRICA - Growth of private equity investments into Africa - Attractiveness of Mauritius - Main structures used for PE investments: Investment Funds Protected Cell Companies Conyers Dill Pearman FUND STRUCTURE FOR INVESTING INTO AFRICA International Investors Investment DTAA Management Manager shares Mauritius Fund Custodian (CIS CEF) Class A Shares Administrator DTAA Class Shares African Countries Mozambique, Uganda, Kenya) Conyers Dill Pearman STRUCTU RING OBJECTIVES - Limitation of investors? liability - Tax treatment - The Mauritius advantage Conyers Dill Pearman LEGAL STRUCTURE OF MAURITIUS FUNDS - Types: Collective Investment Scheme or Closed End Fund - Form: Corporate or Limited Partnership - Func?onanes Conyers Dill Pearman COLLECTIVE INVESTMENT SCHEMES - Key features of CIS - Categories of CIS: Fully Regulated CIS Regulated Global CIS Expert Fund Professional CIS Specialised CIS Conyers Dill Pearman CLOSED END FUNDS - Key features of the CEF Categories of CEF: Non reporting issuers Reporting issuers Conyers Dill Pearman DOUBLE TAXATION AVOIDANCE AGREEMENT NETWORK Wide DTAA network, with strong African links, and more treaties forthcoming: Bangladesh Barbados Belgium Botswana China Croatia Cyprus France Germany India Italy Kuwait Lesotho Luxembourg Madagascar Conyers Dill Pearman Malaysia Mozambique Namibia Nepal Oman Pakistan Qatar Rwanda Senegal SeycheHes Singapore South Africa Sri Lanka Swaziland Sweden ThaHand Tunisia Uganda United Arab Emirates United Kingdom Zimbabwe Being ratified Kenya Republic of Congo Russia Zambia Awaiting signature Egypt Ghana Malawi Nigeria Being negotiated Algeria Burkina Faso Canada Czech Republic Gabon Greece Monaco Ponugal Republic of Iran Saudi Arabia St Kitts Nevis Tanzania Vietnam Yemen Also, TIEA with Australia in force TAXATION RATES FOR MAURITIUS-AFRICA DTAAS Dividends Interest Royalties Country No Treaty UnderTreaty No Treaty UnderTreaty No Treaty UnderTreaty Botswana 15% 5% 10% 15% 12% 15% 12.50% Lesotho 25% 10% 10% 10% Madagascar 20% 5% 10% 10% 5% Mozambique 20Namibia 10% 5% 10% 0 10% 10.50% 5% Rwanda 20% Exempt Exempt Exempt Senegal 10% Exempt 6/8/16/20% Exempt 20% Exempt SeycheHes 15% Exempt 15% Exempt 15% Exempt South Africa 15% 5% 15% 0 Exempt 15% Exempt Swaziland 12.5 15% 7.50% 10% 5% 15% 7. 50% Tunisia 0 Exempt 20% 2. 50% 15% 2.50% Uganda 15% 10% 15% 10% 15% 10% Zimbabwe 20% Conyers Dill Pearman 10% 20% 10% 10% 20% 15% MAURITIUS INVESTMENT PROMOTION AND PROTECTION AGREEMENTS IPPAs Signed and in force Barbados Belgium/Luxemburg Economic Union Burundi China Czech Republic Finland France Germany India Indonesia Madagascar Mozambique Pakistan Portugal Republic of Korea Romania Senegal Singapore South Africa Sweden Switzerland U.K Northern Ireland Conyers Dill Pearman IPPAs awaiting ratification Benin Botswana Cameroon Comoros Ghana Guinea Republic Mauritania Nepal Republic of Congo Rwanda Swaziland Tchad Tanzania Zimbabwe Kenya Information obtained from the Mauritius Board of Investment website on 03 October 2012 CASE STUDY: FUND INVESTING INTO MOZAMBIQUE Private Equity Investment into Tax Effects: a Mozambique Company Mozambique: Corporate tax at 32 WHT on interest at 8% under DTAA (rather through a Mauritius Fund than 20%) Chargeable Income 1,000 PE Investors Corporate Tax 320 xg??uq?ggx: Tax on Interest 136 Net Income after tax 544 Mauritius Fund Chargeable Income 1,000 Corporate Tax 320 Mozambique Tax on Interest 54 under DTAA Net Income after tax 626 Mozambique Chargeable Income 1,000 Company Corporate Tax 150 undae?rb'I?A Foreign Tax Credit (150) Tax Liability NIL Conyers Dill Pearman INVESTING THROUGH A MAURITIUS PROTECTED CELL COMPANY Arranger Trustee Dealer Mana ement Share Manager 9 Mauritius PCC Investor Investor Investor Cell A Cell Cell Shares Shares Shares Cell A 09" Cell DTAA Investments into African Countries Botswana, Senegal, Ghana) Conyers Dill Pearman WHY A MAURITIUS PCC FOR INVESTING INTO - Key features of the Mauritius PCC - The Mauritius benefit Nothing in this document is intended to provide legal, accounting, tax or ?nancial advice. THANK YOU informational purposes only. 0 Conyers Dill Pearman Information herein is provided for Bermuda British Virgin Islands Cayman Islands Cyprus Dubai Hong Kong London Mauritius Moscow $50 Paulo Singapore conyersdi .com