The Protected Cell Company (PCC) Act 1999 provides for a company holding a Global Business Corporation (GBC) licence be set up as a Protected Cell Company and to create cells within its capital for the purposes of segregating the assets within that cell from claims related to assets of another cell. Segregation of cells, effectively provides that creditors of a PCC in respect of one cell will only be able to claims against the assets of a specific cell primarily and against the non-cellular assets of the company secondarily, but not against the assets of other cells of a PCC.
Common uses of PCC
PCC are effective legal structures to carry out two types of activities, global insurance business and investment funds.
Investment Funds can be set up as Umbrella or multi class funds with different classes of shares which provides each individual share class the same limited liability that would be obtained if separate corporate structures were used for each category of investors.
Insurance companies can set up a PCC to segregate the assets and liabilities of its life, pension and individual policyholders.
Taxation of PCC
PCC are licensed as a GBC and would therefore be subject to a tax rate of 15% on their income. However, a PCC have the option of either claiming foreign tax suffered as a tax credit against their Mauritius tax liability or a partial exemption of 80% on certain income subject to meeting pre-defined substance requirements in Mauritius.
The criteria for meeting the substance conditions depend on the nature of the income and licensed activity.
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