About Us

The Financial Services Commission

WHO WE ARE?

We are an institution dedicated to the supervision of the non-bank financial services sector.

About the Financial Services Commission

The Financial Services Commission (FSC) was established as the regulator for the non-bank financial services sector under the Financial Services Development Act 2001. The FSC is the integrated regulator for the industry and its remit encompasses those of the former regulatory bodies for securities (Stock Exchange Commission), insurance (Insurance Division of the Ministry of Economic Development, Financial Services and Corporate Affairs) and global business (Mauritius Offshore Business Activities Authority).

The Commission thus licenses, regulates and supervises non-bank financial institutions in Mauritius.

The non-bank financial sector includes institutions involved in Insurance & Pensions, Capital Market operations, Leasing & Credit Finance as well as Global Business activities.

The FSC is also committed to the sustained development of Mauritius as a sound, stable and competitive international financial services centre. Consequently, the Commission promotes the development, fairness, efficiency and transparency of non-bank financial institutions and capital markets in Mauritius whilst ensuring the protection of investors.

The team heading the Commission comprises:

Board members

Chairperson

Mr. Said Lalloo

Vice Chairperson

Ms. Mary Anne Philips

Members

Mr. Radhakrishna Chellapermal

Mr. Sanjay Gopaul

Mr. Oliver Lew Kew Lin

Mr. Raj Makoond

Mr. Yashovarman Wasvani Appado

CHIEF EXECUTIVE

Mr. Milan J. N. Meetarbhan

WHAT WE DO?

Our main role is to protect the integrity and stability of the non-bank financial services sector and by so doing protect the interest of investors and consumers.

To achieve this:

We oversee all participants in the non bank financial industry including the stock exchange, the depository and settlement system, market intermediaries, collective investment schemes, insurance companies, and the global business sector.
We monitor and supervise them to reduce the risks of non compliance with laws and regulations and to ensure financial soundness.

We License and Approve

Attention is focused on ensuring Competence, Integrity, and Financial soundness of applicants.

· Our licensing process requires that all applicants for a licence meet the fit and proper criteria to operate and provide in a transparent and comprehensive manner all financial and other information about themselves.

· Our approval process ascertains the appropriateness and the level of disclosure of the Collective Investment Schemes.

We Monitor

· We monitor all off-site statutory filings submitted by licensed companies to ascertain that they comply with licensing and on-going obligations particularly that of financial soundness. We examine financial statements and annual reports to verify disclosures made by companies and foster compliance.

· When minor deficiencies are detected, a compliance letter is issued identifying the problems that need to be rectified and the situation is monitored until compliance is achieved. More serious violations are referred for enforcement actions and, where circumstances of the case require, revocation of licence.

· We review rules and propose new mechanisms to check for market malpractices. This includes monitoring stock markets for market manipulation, insider trading, money laundering practices and products mis-sellings by market intermediaries.

We Regulate

· We regulate the industry by establishing rules to adapt our regulatory structures to new circumstances.

· We issue Guidelines in line with international standards of regulation. We foster good governance and establish in consultation with the industry, Codes of best practice.

We Enforce Laws

· Matters which are referred to after investigation are taken up by the Enforcement Unit.

· While minor breaches of the law are dealt with by the Enforcement staff, more serious breaches are brought to Court after the Commission has secured the necessary evidence through formal enquiries, examining records, and other methods the Commission may deem appropriate that there has been breach of legal requirements.

WHOM AND HOW WE REGULATE?

The Commission licenses, regulates, monitors and supervises the conduct of business activities in the financial services sector.

Whom we regulate

FSC regulates non-bank financial institutions whose roles are to channel funds from lenders to borrowers by accepting long-term or specialised types of deposits and by incurring liabilities on their own account through the issuing of bills, bonds or other securities. Such institutions often specialise in lending to particular types of borrowers and in using specialised financial arrangements such as financial leasing, securitised lending, and financial derivatives.

Entities falling under non-bank financial institutions category are:

Insurance & re-insurance companies

Leasing companies

Credit finance companies

Market intermediaries: fund managers, portfolio managers, investment managers / asset managers, custodians, brokers, investment advisers

Cooperative credit unions

· We regulate Investment Schemes.

This category comprises institutions that are organised financial arrangements that consolidate investor funds for the purpose of acquiring financial assets.

Entities falling under Investment Schemes category are:

Authorised mutual funds

Unit trusts

Global Business funds and other Collective Investment Schemes.

Pension and Equity funds

The Commission also monitors Financial Service Providers.

This includes firms or individuals that arrange, execute, or otherwise facilitate client transactions in financial assets by providing specialised services to their customers. These units do not, as a main business activity, raise funds or extend credit on their own account.

Entities falling under Financial Service Providers category are:

Management Companies / Corporate Trustees

Captive Managers

Collective Investment Scheme Managers

Stockbroking companies / Underwriters

Insurance brokers

Professional Financial Advisers

How we do it

· Set licensing standards and grant licences

· Enforce Codes and Guidance

· Authorise investment products and services

· Ensure compliance with expected standards of conduct and the law

· Handle complaints

· Investigate malpractices and fraud and take corrective actions.

· Conduct off-site and on-site compliance visits of licensed entities.

Our Approach to Integrated Regulation

· The FSC has begun to implement a risk-assessment approach to the regulation of all financial services under its remit which integrates and simplifies the different approaches adopted by individual regulators of the past.

· The new approach seeks to identify and focus regulatory attention on institutions and activities that are likely to pose the greatest risk to market confidence; and to act upon them in an integrated manner so as to avoid any spill over effects in the event of failure or collapse of any firm under our purview.

· We believe the integrated approach will make it easier to coordinate supervision of firms with multiple authorisations operating in various sectors of the financial sector.

· Integrated regulation will also help us assess additional benefits to be gained by bringing into single teams all the resources needed to supervise complex financial groups.

FUNCTIONAL STRUCTURE

To implement its statutory objectives, the Commission has set up a four-pronged functional structure which reflects its core activities (policy and research, licensing, surveillance and enforcement), backed up by a structure of support services.

Policy and Research Unit

The main function of the Unit is to research and analyse regulatory developments in the non-bank financial services sector locally and abroad, and to propose amendments to upgrade current practices to international standards. This Unit works towards policy formulation in relation to regulation and supervision.

The Unit also collects and analyses statistical data to capture the main trends of the financial markets and provide critical information to the industry and investors.

Licensing Unit

The licensing unit is responsible for

· Processing applications for setting up business in the non-bank financial sector and generally for collective investment vehicles, insurance and global businesses, and other financial services such as leasing, asset management, custodial services and the like.

· The licensing process involves vetting firms at entry to allow only firms and individuals who satisfy the necessary criteria of financial soundness, competence, integrity and honesty to engage in any activity pertaining to non-bank financial services.

· We are implementing a new integrated approach to licensing firms which allows us to be consistent in the way we assess applications for authorization for all financial services under our remit.

As a general rule, firms proposing investment products or financial business activities must be licensed. They have to file in documents describing:

- The company’s properties and business

- The product / services to be offered

- Past track record and profile of the promoters

- Other additional information which the FSC deems appropriate

Surveillance Unit

· It ensures that all regulated firms and financial intermediaries comply on an ongoing basis with regulatory financial and disclosure requirements, and with all conduct of business regulation.

· It allows the FSC to identify compliance problems and deal with firm specific risks in a quick and informal manner. Deficiencies in compliance are brought to the attention of the licensee and the latter is monitored until compliance is achieved. Serious breaches are referred to the Enforcement Unit.

· It investigates any suspected breach of legal and regulatory requirements.

· It helps FSC maintain stability in the financial system and achieve its consumer protection mandate.

Enforcement Unit

· The Enforcement Unit acts upon recommendations made by the Surveillance Unit to enforce laws relating to the non-bank financial services industry.

· It seeks to report and suppress illegal or improper practices.

· The Unit may make recommendations to the Board of FSC regarding -

- Withdrawal of operating licence.

- Refusal to renew licence.

- Disciplinary action against operators in the financial services sector.

- Enforcement of civil sanctions where the law so empowers it.