On 28 January 2020, the Stock Exchange of Mauritius ("SEM") announced that it is amending its trading rules and opening up to international central securities depositories ("ICSDs"), including Euroclear and Clearstream. This forms part of the measures announced in the Budget Speech for 2019-2020 to transform the Mauritian debt market by ensuring that some qualified international products listed on the SEM are Euroclearable.
The new framework will apply to debt instruments such as specialist debt securities, Eurobonds, exchange traded funds (ETFs), exchange traded notes (ETNs) and structured products listed on SEM and issued by foreign issuers to foreign investors or investment entities holding a Global Business Licence.
In practice, this will allow foreign investors who own debt instruments listed on SEM to request, for example, a Euroclear "XS" trade prefix and International Security Identification Number ("XS" ISIN), and to transfer their securities directly via Euroclear to other investors. However, it should be noted that in line with SEM's current regulatory framework, all trades executed on the automated trading system of SEM remain cleared and settled through the Central Depository & Settlement Co. Ltd (CDS).
The SEM is currently involved in consultations with key stakeholders and service providers to explain the new opportunities that this new opening framework with ICSDs can generate.