FS-1.18 Robotic and Artificial Intelligence Enabled Advisory Services.

Financial Services Act section 2: “financial services” means any financial services or financial business activities governed by the relevant Acts, and includes the financial business activities specified in Part I of the Second Schedule.

Second Schedule Part I lists “Robotic and Artificial Intelligence Enabled Advisory Services” as a financial business activity. The Schedule names the activity; it does not add a further statutory definition of the book of business. What is permitted is the business activity specified on the licence under section 18(1), read with any FSC Rules and the published criteria for this code.

Financial Services (Robotic and Artificial Intelligence Enabled Advisory Services) Rules 2021, rule 2: the activity “means the provision of digital and personalised advisory services through a computer program and/or artificial intelligence enabled algorithms with limited human intervention.” “Advisory services” includes discretionary and non-discretionary investment and portfolio management services provided by the licensee to its clients.

Rule 4(1): “No person shall carry out Robotic and Artificial Intelligence Enabled Advisory Services without a Robotic and Artificial Intelligence Enabled Advisory Services licence issued by the Commission.” Rule 4(2): the applicant may also apply for another licence, authorisation, registration or approval under a relevant Act.

FSC FAQ on these Rules: the Securities (Investment Advice) Rules 2021 exempt the holder from needing an Investment Adviser licence in order to advise or manage a portfolio of securities for clients. That is an FSC FAQ reading of those Rules, not a repeal of Securities Act section 30 for everyone else. VAITOS Class I remains a different statute.

Section 14(1): “No person shall carry out, or hold himself out as carrying out, in Mauritius any financial services without a licence issued by the Commission.” Section 14(2): contravention is an offence, a fine not exceeding one million rupees and imprisonment for a term not exceeding 8 years.

Section 16(1): an application must be in such form and manner as FSC Rules specify and accompanied by “(a) a business plan or feasibility study outlining the proposed business activity of the applicant; (b) particulars and information relating to customer due diligence verification of promoters, beneficial owners, controllers and proposed directors …; (c) such fees as may be specified in FSC Rules; and (d) such other information as may be specified in FSC Rules or otherwise required by the Commission”.

Section 18(1): the Commission may issue a licence “authorising the applicant to carry out the business activity specified in the licence on such terms and conditions as may be specified in FSC Rules or as it deems appropriate in the circumstances.” Section 18(2) forbids a grant unless, among other things, the application complies with the law, the applicant has “adequate resources, infrastructure, staff with the appropriate competence, experience and proficiency”, adequate arrangements to supervise everything done under the licence, fit-and-proper controllers and beneficial owners, and “no prejudice would be caused or would ensue to the financial services industry”. Section 18(3): the holder “shall, at all times, continue to satisfy the requirements specified in subsection (2)”.

Section 25: the Commission may, by written notice, vary a licence. It must not restrict the authorised activity or include further conditions unless it has notified the licensee of the proposal and the reasons and given a reasonable opportunity to make representations.

Part V ongoing obligations of licensees still attach: record keeping (section 29) and audited financial statements (section 30), unless a specific exemption is granted. A circular or a criteria PDF does not rewrite those sections.

Rules 2021, rule 5: principal bank account in Mauritius; an office and infrastructure in Mauritius; internal controls, cyber-risk and governance policies; business continuity; data-protection of client information; board of at least three directors, one of whom shall be an independent director and a resident of Mauritius; adequate officers; a binding code of conduct.

Rule 6: minimum unimpaired stated capital of MUR 600,000 or its equivalent in a foreign currency, at all times. Rule 7: professional indemnity insurance of at least MUR 2 million. Rule 8: client funds segregated from the licensee’s own funds, in an account with a duly licensed bank.

Rule 9: suitability — investment advice through the platform must be suitable for the client. Rule 10: the board is responsible for algorithm performance, testing and competent officers; key processes and management of client-facing tools must not be outsourced. Rule 13: independent evaluation reports of algorithms at least once every two years and after material changes.