In 2020, Mauritius introduced a new entity type called a Variable Capital Company, otherwise known as a VCC, with the stated intention of strengthening the competitiveness and expand the product base of the financial services sector in Mauritius.

The Variable Capital Companies Bill, which sets out the legal framework for the incorporation, structure, operation, conversion, and termination of a VCC, was introduced as an urgent Bill in the National Assembly on 4 April 2022, later passed as the Variable Capital Companies Act (‘VCC Act’) by the National Assembly on 12 April 2022 and gazetted on 15 April 2022, now awaiting proclamation.


The new VCC corporate entity structure for investment funds can be set up as a standalone entity (similar to a company) or as an umbrella entity where multiple collective investment schemes may be gathered under the umbrella of a single corporate entity.

A standalone fund will comprise a single investment portfolio. If the umbrella structure is used, each sub-fund of the VCC can have different shareholders or investors, different investment objectives, and separate assets and liabilities.

Sub-funds can hold shares in other sub-funds of a VCC, which gives investors (or family members) the ability to invest into parts of the structure. As a result, a single VCC with multiple sub-funds can be used in place of multiple companies and trusts as found in a typical group structure. The sub-funds can, however, have the same board of directors, fund manager, custodian, auditor, and administrative agent, resulting in material cost savings.


  • A company already incorporated in Mauritius may be converted into a VCC.
  • A company incorporated in jurisdictions other than Mauritius may be redomiciled in Mauritius as a VCC.
  • A VCC can start off as a standalone fund and further sub-funds can be added later.
  • Each sub-fund or special purpose vehicle can opt to have a legal personality distinct from the VCC.
  • The VCC can be used for open-ended funds as well as close-end funds and for many different types of investment funds, for example, mutual funds, private funds, or real estate funds.
  • Each sub-fund or special purpose vehicle incurs its own liability on its own and its liability is segregated.


Relevant amendments under the Mauritius Income Tax Act, 1995 to cater for VCCs are as follows:

  • The amendment of the definition of ‘company’ to include a VCC, its sub-fund or special purpose vehicle. VCCs incorporated under the VCC Act will therefore be treated as companies.

  • Where a VCC makes an election to present separate financial statements for each of its sub-funds or SPVs, each sub-fund or SPV will be required to file separate income tax returns.

If this tickles your interest, please reach out to us to discuss whether there is a benefit to convert your existing structure or to incorporate a VCC to house your investment portfolios.

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How can we help?

How you structure your business is a critical question as you expand globally.  The right structure will protect your assets, improve your currency position, support your business operations, facilitate future business expansion and changes, and optimise your overall tax rate. Trying to unscramble a sub-optimal structure entered into in haste or without full consideration of relevant facts is complex and expensive, so it’s important to plan upfront.

Structuring an international business is both a science and an art – this is our specialist area of expertise. Regan van Rooy is an international tax and structuring advisory firm focussing on Africa. We have offices in South Africa, Mauritius and Ireland and we can help you with any international tax or structuring query.