To place investment portfolios offshore SA so that (perfectly legitimately) they may grow without the adverse impact of SA taxes – income and capital gains.

SA "FIC/CFE" tax rules provide that gains made by a relevantly controlled (50%+) offshore vehicle are to be taxed to the investor (by attribution) - as if the gains had been made in SA. Thus, to avoid "FIC/CFE" taxation by attribution, the investor must necessarily involve himself with other investors through an umbrella fund, for example, an OIEC (with sub-funds), unit trusts, etc. The investor must, simultaneously, expose himself to the cross-over liabilities of other investors. The fund manager of an umbrella fund will attempt to minimize the exposure to such cross-over liabilities by ensuring that there is but one fund manager of the fund, with or without additional complications such as contractual and/or debt nature devices. But this limits investor freedom. The individual sub-fund, or sub-unit, investor is compelled to use the services of the fund manager appointed by the institution promoting the fund. Not so with First Mauritius.

First Mauritius provides a structure which resolves the existing problem:

1. First Mauritius is an umbrella fund with no cross-over liabilities amongst investors; a cross-liability-free environment clearly and simply provided by statute and not – dubiously and questionably - by complex devices.
2. First Mauritius is not a "FIC" or a "CFE" under SA tax rules.
3. Although other offshore umbrella funds afford the investor protection against the "FIC/CFE" tax rules, the same vehicles do not protect the investor against cross-over liabilities. This absence of cross-over liability protection in umbrella funds itself makes the case for First Mauritius.
4. Umbrella funds seek to limit cross-over liability through insisting that the investor use the institution-chosen fund manager, and no one else.
5. In the case of First Mauritius, each investor has cross-over liability as well as the freedom to use his own personal fund manager/s, with the freedom to change fund manager/s as he sees fit from time to time.
6. The First Mauritius structure provides the "good news" without the accompanying "bad news".

1. Gross roll-ups outside SA with indefinite deferral of capital gains tax.
2. No cross-over liabilities amongst investors; cf. unit trusts, OIECs, etc.
3. Freedom of choice with respect to individual investor fund manager/s.
4. Gross reinvestment available.
5. Structure fees are SA tax deductible and do not incur VAT.
6. Partial and selected voluntary aggregation of investors’ funds enable HNWI threshold investments to be accessed (for example, Private Equity Finance Initiatives or pre-IPO’s or SICAV’s).
7. Tax treaty benefits (hence, increased net returns on investments).
8. Ability to invest directly into SA without the gains attracting SA tax.