Caribbean vs Mauritius: BVI and Cayman funds compared with Mauritius

Overview

Mauritius is regulated by the Financial Services Commission (FSC) Mauritius and offers fund structures — chiefly the Collective Investment Scheme (CIS, in Public and Private/Expert variants), Closed-End Funds, and specialist private equity and venture capital vehicles — built on a hybrid legal system combining English common law and French civil law influences. Unlike BVI and Cayman, whose principal value proposition is a broad, jurisdiction-agnostic tax-neutral wrapper, Mauritius's core value proposition is its extensive double taxation avoidance agreement (DTAA) network, historically anchored by its treaty with India and increasingly leveraged for sub-Saharan Africa-focused investment structures.

Mauritius is therefore not a like-for-like competitor to BVI/Cayman across most use cases; it is the preferred domicile specifically for funds structuring exposure into markets where its treaty network or economic-substance-driven structuring provides a genuine tax or access advantage. Reputationally, Mauritius carries a mixed record: it was placed on the FATF grey list in February 2020 but successfully exited in October 2021 after completing a reform action plan, including strengthened beneficial-ownership transparency and AML/CFT supervision — a rehabilitated but still occasionally-raised point in institutional due diligence.

Key features

Regulatory framework

Mauritius's fund regime gives it structuring flexibility — protected cell companies, Global Business Licence entities used as both operating and holding vehicles — alongside a genuine economic substance requirement, meaning Mauritius entities generally need demonstrable local management, staffing or decision-making presence to access treaty benefits. This differs from the largely jurisdiction-agnostic tax neutrality of BVI/Cayman, which are not signatories to the kind of extensive bilateral DTAA network Mauritius has cultivated.

This treaty network is Mauritius's genuine differentiator: its DTAA with India has historically been central to inbound Indian portfolio and private equity investment structuring, and Mauritius has increasingly repositioned itself toward Africa-focused fund structuring, leveraging its treaty network across multiple African jurisdictions. Cost and timeline both run against Mauritius relative to the Caribbean: setup timelines of roughly 8–12 weeks are markedly longer than BVI's fastest routes and even Cayman's ~2-week Private Fund registration, reflecting the more document- and substance-intensive Mauritius licensing process.

Practical considerations

• Choose Mauritius when the fund's core strategy is India- or Africa-focused and treaty-based withholding tax mitigation materially improves net investor returns.
• Choose BVI/Cayman when the fund's target markets, investor base or strategy have no meaningful treaty dependency — the global tax-neutral wrapper plus faster/cheaper setup will usually be the better fit.
• Budget for economic substance — Mauritius structures relying on treaty access typically need genuine local substance, adding ongoing cost not present in a comparable BVI/Cayman vehicle.
• Plan for a longer runway — Mauritius's ~8–12 week typical setup timeline is materially longer than BVI's or Cayman's fastest routes.
• Address the FATF history proactively in investor due diligence materials — the 2021 grey-list exit is resolved but institutional investors may still ask about it.
• Consider hybrid structures — some promoters combine a Mauritius vehicle for treaty-sensitive underlying investments with a Cayman or BVI vehicle further up the structure.

How Berkley can help

Berkley Fund Services administers funds domiciled in both the British Virgin Islands and the Cayman Islands, and works alongside promoters and their legal counsel from the earliest stages of structuring to help match a fund's strategy and investor base to the right jurisdiction and vehicle. Promoters weighing up their options are welcome to discuss a proposed structure with Berkley's team before finalising an offering document.