As mentioned in our earlier newsflash, Mauritius was added to the EU list of high-risk third countries (List) on 7 May 2020, due to the listing of the country by the Financial Action Task Force (FATF) on its list of ‘Jurisdictions under Increased Monitoring’ earlier this year.
Immediately following this, the Mauritian Ministry of Financial Services and Good Governance issued a communiqué to underscore the commitment of Mauritius to implement the FATF Action Plan as soon as possible in order to exit the FATF and the EU lists.
The Government of Mauritius, through the Prime Minister’s Office, has now issued a further communiqué enumerating the various grounds for Mauritius to be taken off the List. It is the Government’s contention that:
- Mauritius had not been given the opportunity to provide any explanation or make any representation prior to its inclusion on the List which the Government flags as a breach of a fundamental right of a State under Article 41 of the EU Charter of Fundamental Rights.
- The EU Commission had merely replicated the findings of the FAFT without considering the intrinsic and fundamental differences between countries that form part of the FATF blacklist as compared to other countries like Mauritius, that are on the monitoring list.
- The EU Commission had disregarded the fundamental principle of proportionality in failing to measure the seriousness of the consequences of including Mauritius on the List as compared to the actual risks posed to the EU financial system.
- The decision of the EU Commission will cause irreversible damage to the reputation of Mauritius and it comes at a time when Mauritius is already experiencing the brutal economic effects of the COVID-19 pandemic.
- The EU Commission’s list has not yet been approved by the European Parliament and the EU Council of Ministers and has not come into force yet, but once approved, will exacerbate the recession already caused by the pandemic and the Government is of the view that it is disproportionate to penalise the country so harshly on the basis of ‘unproven risks’.
- Mauritius has already agreed upon a detailed action plan with the FATF, with specific deadlines to remedy the identified shortcomings. Out of a total of 58 recommended actions, Mauritius has only five outstanding actions to implement by September 2021.
While not underrating its commitment to address the identified shortcomings as soon as possible, and even before the September 2021 deadline, the Government of Mauritius is also making a forceful plea to the organs of the EU to remove Mauritius from its proposed List.
There has been no official response from the EU Commission to date.