Financing & Transaction Advisory
Facility, Security and security assignment agreements, including Islamic finance.
SC Legal acts for banks, non-bank lenders, borrowers, sponsors and guarantors on financings governed by Mauritian law. We negotiate and draft facility agreements, security over Mauritian assets under the Code Civil Mauricien, guarantees, security assignments and Islamic finance structures, and give the capacity and enforceability opinions that foreign lenders require.
Mauritian security law is civil law in origin, while most cross-border facility agreements follow English-law templates. Much of our work is making the two fit, so that security taken in Mauritius does what the facility agreement assumes it does.
What financing work do we handle?
- Bilateral and syndicated facility agreements, term loans and revolving facilities.
- Acquisition, project, real estate and construction finance.
- Mortgages (hypothèques) over immovable property.
- Fixed and floating charges over company assets.
- Pledges over shares, bank accounts and movable assets.
- Assignments of receivables, insurance proceeds and contracts by way of security.
- Personal and corporate guarantees.
- Intercreditor, subordination and security trust arrangements.
- Debentures, bonds and notes.
- Islamic finance: murabaha, ijara, musharaka and sukuk structures.
- Restructuring, rescheduling and enforcement of loans.
Taking security in Mauritius
Security over Mauritian assets is created and perfected under the Code Civil Mauricien and related statutes. The type of asset decides the instrument. Immovable property is secured by a mortgage. A company's assets can be secured by a fixed charge over specific assets and a floating charge over its whole undertaking. Shares, accounts and other movables are pledged. Receivables and contract rights are assigned by way of security, with notice to the debtor where perfection requires it.
Most security must be inscribed with the Conservator of Mortgages to be effective against third parties, and registration duty may apply. A missed formality can leave a lender unsecured in a later insolvency. We prepare the security documents, handle the inscription and confirm the ranking.
Facility agreements and guarantees
We draft and negotiate facility agreements for lenders and borrowers, often adapting Loan Market Association-style templates to Mauritian law on interest, default, set-off and enforcement. Guarantees given by individuals and companies are drafted to satisfy the Code Civil rules on suretyship (cautionnement), which require the scope of the guarantee to be clear. For corporate guarantors, we check corporate benefit and the directors' authority.
Islamic finance
We advise banks and corporates on Shariah-compliant financing under Mauritian law. In a murabaha, the bank buys an asset and sells it to the customer at an agreed mark-up payable in instalments. In an ijara, the bank owns the asset and leases it to the customer. Each structure has to be tested against Mauritian rules on transfer of title, registration duty and security, so that the Shariah structure and the legal structure match.
Legal opinions and enforcement
Foreign lenders lending to Mauritian borrowers, or taking Mauritian security, usually require a Mauritian law opinion on capacity, authority, enforceability and choice of law. We issue those opinions. When a facility goes into default, we advise lenders on demand, enforcement of security, receivership and insolvency, and advise borrowers on rescheduling and defence.
Frequently asked questions
What security can a lender take over assets in Mauritius?
A mortgage over immovable property, fixed and floating charges over a company's assets, pledges over shares, bank accounts and movables, and assignments of receivables and contracts. Most security must be inscribed with the Conservator of Mortgages to bind third parties.
Can a foreign lender take security over Mauritian assets?
Yes. A foreign lender can hold Mauritian security directly or through a security agent or trustee. The security documents must comply with Mauritian law and formalities, and lenders usually require a Mauritian law enforceability opinion.
Are personal guarantees enforceable in Mauritius?
Yes. A guarantee is a contract of suretyship (cautionnement) under the Code Civil Mauricien. It must be expressly given, and its scope is read restrictively, so the amount, the obligations covered and any waiver of the guarantor's defences should be stated clearly.
Is Islamic finance available in Mauritius?
Yes. Banks licensed in Mauritius offer Shariah-compliant products, and murabaha, ijara and musharaka structures can be documented under Mauritian law. The documents must address title transfer, duties and security so that the structure works legally as well as under Shariah principles.
Financing work connects to other areas. See our pages on capital markets for bond issues, insolvency and restructuring for receivership and enforcement of security, and real estate for property security.