1. History
Mauritius has experienced a real kickoff in Securities Laws in the year 2007 when the President of the Republic proclaimed the legislation headed ‘’The Securities Act 2005’’ on 12th September 2007. The provisions under this Act then came into operation on the 28th September 2007. Some amendments were brought to it under Act no 15 of 2007 with same date of proclamation and coming into operation. The purpose of such amendment was to harmonise the provisions thereof with those relating to other non-bank financial services.
Act 11 of 1987 set up the Stock Exchange, the Stock Exchange Commission and the Chamber of Stockbrokers. The limitative list of Securities then comprised of share, debenture or bond quoted on the Stock Exchange. The stockbrokers were appointed by the Minister to carry out the business of dealing in securities quoted on the Stock Exchange. Brokers who were appointed under the Brokers Act could elect to be exempted by the Act. In 1988, a new Stock Exchange Act came into operation thus repealing Act 11 of 1987.
In 1996, The Securities (Central Depository, Clearing and Settlement) Act 1996 has made provision for the establishment and regulation of a central depository, clearing and settlement service in order to facilitate dealings in securities. The notion of Certified Securities and Derivative Instruments emerged. As at date the following meanings are given to the expression ‘’Securities’’:
’’ shares or stocks in the share capital of a local or a foreign company, other than a collective investment scheme; debentures, debenture stock, loan stock, bonds, convertible bonds or other similar instruments; rights warrants, options or interests in respect of securities mentioned above; treasury bills, loan stock and other instruments creating or acknowledging indebtedness and issued by or on behalf of or guaranteed by the Government of the Republic of Mauritius or the government of another country, a local authority or public authority, as may be prescribed; shares in, securities of, or rights to participate in, a collective investment scheme; depository receipts in similar instruments; options, futures, forwards and other derivatives whether on securities or commodities; any other transferable securities, interests or assets as may be approved by the Financial Services Commission; or any such instruments as may be prescribed’’.
The Securities Act has indeed established a framework for the regulation of securities markets, depository, clearing and settlement facilities, securities exchanges and intermediaries and provides for self-regulatory organisations and regulates the offering and trading of securities and other related matters. It’s coming into operation as a one stop shop has done away with legislations scattered in several enactments which are namely a) the Stock Exchange Act, the Unit Trust Act, the Transfer of Shares and Debentures Act, some provisions in the Companies Act 2001, the Stock Exchange (Dealer’s Representatives’ Examinations) Regulations 1992, the Stock Exchange (Stockbrokers’ Examinations) Regulations 1993, the Stock Exchange (Licensing) Regulations 1989, the Stock Exchange (listing Committee) Regulations 1993, the Companies (Purchase of own Shares Regulations 2001.
What follows is an analysis of combined efforts of the Financial Services Commission, the Stock Exchange of Mauritius and the Central Depository and Settlement Co Ltd geared towards elevating and ranking Mauritius as a safe and credible International Securities Market.
1. The combined roles of the FSC, SEM and the CDS and the Financial Markets Regulations.

a) Role of Financial Services Commission (FSC)
The Financial Services Commission (FSC) is an emanation of the Financial Services Development Act (FSDA) 2001 which was repealed and replaced by the Financial Services Act (FSA) 2007.The former came into operation after the Mauritius Offshore Business Activities Act (MOBAA) 1992 was repealed. The MOBAA had for main objectives to provide for the establishment of the Mauritius Offshore Business Activities Authority to regulate offshore business activities from within Mauritius and for the issue of offshore certificates and to provide for other ancillary matters. The FSA has amended and consolidated the law regulating financial services, other than banking, and global business and to provide for related matters.
The FSC ensures the orderly administration of the financial services and global business activities and ensures the fairness, efficiency and transparency of financial and capital markets in Mauritius. All licences for Securities Exchanges; for deposit, clearing or settlement of securities transactions; trading Securities Systems, are issued by the FSC after ascertaining that the criteria imposed are fully satisfied.
b) Role of the Stock Exchange of Mauritius (SEM)
Notwithstanding the repeal of the Stock Exchange Act as above referred to, the SEM established there under continues to be in existence. It is deemed to be licensed as a Securities Exchange and it is governed by the provisions made under the Securities Act and any FSC rules. It has regulatory functions and it ensures the adequate supervision of the market operations and the conduct of the market participants i.e. all investment dealers or any person which have been given direct access to trading on the exchange. It ensures the adequacy and the efficiency of internal controls. It investigates into the misconduct by market participants and into possible market abuses including insider dealing and fraudulent behavior among its duties and it is answerable to the FSC. Though the SEM is a public company, it is not allowed to make any change in its legal structure and any public offer of its securities without the approval of the FSC.

c) Role of Central Depository and Settlement Co Ltd (CDS)
The CDS is deemed to be licensed as depository, clearing and settlement facility and it is governed by the provisions made under the Securities Act and any FSC rules. It has for main purpose to establish a clearing and Settlement Advisory Committee to review and make recommendations concerning system designs, operational procedures and problems and the introduction of new services. The exclusive method of transferring the ownership of securities is vested with the CDS and all transfers are made in accordance with its rules and procedures.
The records of the CDS will prevail should there be any conflict between its records and any other records or documents concerning the ownership and transfer of securities deposited in the CDS.

2. The roles of Intermediaries
a) Investment dealer
No physical person can act as an investment dealer; it should be a body corporate. All investment dealers must take a licence from the FSC to act as such. That licence will grant them the right to act and hold themselves out as an intermediary in the execution of securities transactions on behalf of other persons. They can trade or hold themselves out to trade in securities as principal for their own account with the intention of selling them to the public. They can underwrite or distribute or hold themselves out to underwrite or distribute securities on behalf of an issuer or a holder of securities. Any financial institution wishing to act as investment dealer will be subject to the rules of the FSC.

b) Investment Adviser

The investment adviser may be a body corporate or a physical person and after being duly licenced by the FSC, he can advise, guide or recommend other persons, or hold himself out to advise, guide or recommend other persons, whether personally or through printed materials or by other means, to enter into securities transactions; or manage or hold himself out to manage, under a mandate, whether discretionary or not, a portfolio of securities.

So far as I know there is no local case law at hand which has tested the system governed by our securities laws. We can but conclude that our securities environment is safe and credible for both local and foreign investors.