Virtual Asset and Initial Token Offering Services (VAITOS) – FSC Mauritius
What is the FSC Mauritius and what does it do?
The Financial Services Commission (FSC) Mauritius is the integrated regulator for the non-bank financial services sectors and global business of the Republic of Mauritius. Established in 2001, the FSC Mauritius is responsible to license, regulate, and supervise the conduct of business activities in the securities, insurance, private pension schemes and virtual assets sectors. The FSC Mauritius aspires to be an internationally recognised financial supervisor, committed to the sustained development of Mauritius as a sound and competitive financial services centre.
The Mauritius Virtual Asset and Initial Token Offering Services (VAITOS) Act 2021
Mauritius, being a thriving international financial centre and emerging FinTech hub, stands as one of the pioneering nations in the Eastern and Southern African region to introduce comprehensive legislation pertaining to Virtual Assets (VA) and Initial Token Offerings (ITO). The VAITOS Act establishes a well-defined and thorough foundation for operators within the evolving FinTech landscape in Mauritius. Simultaneously, it ensures that the legal framework for regulating this class of assets aligns seamlessly with global standards. The VAITOS Act came into force in Mauritius on 7 February 2022.
The VAITOS Act bestows authority upon the FSC of Mauritius to oversee and regulate Virtual Asset Service Providers (VASP) and ITO issuers within the non-bank financial services sector of Mauritius.
This comprehensive legislation addresses a multitude of critical aspects, including but not limited to technical prerequisites, governance structures, risk management, disclosure of information on the part of VASP, and the safeguarding of the rights of clients engaging with Virtual Assets and Virtual Tokens (VT). Moreover, the Act is designed to ensure that ITO issuers maintain transparency, accuracy, and timeliness in their disclosures.
The FSC has also issued numerous rules to complement the VAITOS framework in Mauritius.
Why establish a Virtual Asset Service Provider in Mauritius?
A Virtual Asset Service Provider in Mauritius benefits from:
- A strategic time zone that enables businesses to be conducted on four different continents on the same day.
- A sophisticated and well-capitalised banking sector comprised of local and international banks, that offers a complete range of services including corporate banking and custodian services.
- A skilled and educated workforce that speaks both the English and French languages.
- A hybrid legal system based on English and French law, with the United Kingdom Privy Council acting as the ultimate court of appeal.
- The option to choose from more than one hundred accounting and audit firms to establish a business relationship with.
- Mauritius is among the first countries in the Eastern and Southern African regions to adopt comprehensive legislation on virtual assets and initial token offerings.
- Mauritius’ VA and ITO framework is largely compliant with Recommendation 15 regarding VA and VASP of the Financial Action Task Force (FATF).
Business Activities
Each class of license authorised by the FSC Mauritius prescribes a specific set of business activities. A Virtual Asset Service Provider may apply and be authorised for multiple classes of license. The business activities under each license class are presented in the table below.
| Class of License | Business Activities |
|---|---|
| Class M – Virtual Asset Broker Dealer | Any virtual asset services provider that conducts one or both of the following: • Exchange between virtual assets and fiat currencies, • Exchange between one or more forms of virtual assets. |
| Class O – Virtual Asset Wallet Services | • Transfer of virtual assets. |
| Class R – Virtual Asset Custodian | • Safekeeping of virtual assets or instruments enabling control over virtual assets, • Administration of virtual assets or instruments enabling control over virtual assets. |
| Class I – Virtual Asset Advisory Services | • Participation in the provision of financial services related to an issuer’s offer and/or sale of virtual assets. |
| Class S – Virtual Asset Market Place | A Virtual Asset Exchange as a centralised or decentralised virtual platform, whether in Mauritius or in another jurisdiction which facilitates the exchange of VA for fiat currency or other VA on behalf of third parties for a fee, a commission, a spread or other benefit and which: • Holds custody, or controls VA, on behalf of its clients to facilitate an exchange, or • Purchases VA from a seller when transactions or bids and offers are matched in order to sell them to a buyer. |
| Issuers of Initial Token Offerings | • Issuance of Initial Token Offerings |
Initial Capital Requirements
Minimum initial capital requirements vary between the different classes of license as per the table below. If a Virtual Asset Service Provider applies for multiple licenses, it shall be subject to the combined capital requirement for each license class.
| Virtual Asset Service Provider | Capital Requirements |
|---|---|
| Class M – Virtual Asset Broker Dealer | 2,000,000 MUR or its equivalent in any other fiat currency. |
| Class O – Virtual Asset Wallet Services | Sufficient working capital in fiat currency to continue business for a period of 12 months, based on realistic forecasts for the business in different market conditions, both negative and positive scenarios. |
| Class R – Virtual Asset Custodian | 5,000,000 MUR or its equivalent in any other fiat currency. |
| Class I – Virtual Asset Advisory Services | Sufficient working capital to be capable of meeting debts as they fall due. |
| Class S – Virtual Asset Market Place | 6,500,000 MUR or its equivalent in any other fiat currency. |
| Issuers of Initial Token Offerings | Sufficient working capital to be capable of meeting debts as they fall due. |
Applications Fees
FSC Mauritius application fees depend on the Category of License to be acquired and more specifically the License Class. Other one-off fees are also applicable in relation to the incorporation of the Company and additional regulatory requirements.
Annual Fees
License renewal fees are fixed and depend on the type of License Class or the combination of Classes held. Additional fees apply, depending on the regulatory obligations of the Company.
Licensing Timeframe
In our experience, the FSC Mauritius licensing procedure can be concluded in 6 months. This depends on the quality and completeness of the required information that has been provided and the applicant’s capacity to deliver a clear business plan and vision. Yet, we advise our clients to budget for 7 to 9 months, in anticipation of the varying workload of the FSC Mauritius and the time it may take to revert to the FSC Mauritius promptly with the requests for additional information and documents.
Obtaining an FSC Mauritius VASP license with SALVUS
The SALVUS Crypto Assets Licensing team employs a project management approach to oversee each licensing project. We draw upon our expertise in dealing with the FSC in Mauritius to gather all the required information and compile the necessary documentation for submitting a comprehensive and well-supported application. Furthermore, we aid our clients in optimising the allocation of their financial resources, utilising a combination of in-house personnel, outsourcing agreements, and third-party providers.
Contact us at info@salvusfunds.com to initiate a discussion about your licensing needs, whether they pertain to FSC Mauritius or other requirements. We understand that your business may face unique challenges, and we are ready to assist you in accomplishing your business objectives. We eagerly anticipate collaborating with you and being of value.