No shell company in Mauritius; Hindenburg allegations 'false, baseless': Mauritius Min tells Parliament

In a boost to the embattled Adani Group, Mauritian Financial Services Minister Mahen Kumar Seeruttun has told the nation's Parliament that Hindenburg Research's allegations of the presence of 'shell' companies in the Island nation are 'false and baseless' and that Mauritius was in compliance with OECD-mandated tax rules.

US short seller Hindenburg on January 24 alleged that billionaire Gautam Adani used shell companies based in Mauritius to manipulate stock prices of his Indian-listed companies.

A shell company is an inactive firm used as a vehicle for various financial manoeuvres.

When a Member of Parliament (MP) through a written notice question asked the Minister about Hindenburg's allegation of use of Mauritius-based entities as conduits for money laundering and share price manipulation for the Adani Group, the minister said the nation's law does not allow shell companies.

"At the outset, I wish to inform the House that the allegations of the presence of shell companies in Mauritius are false and baseless," he said. "According to the law, shell companies are not allowed in Mauritius." All global business companies licensed by the Financial Services Commission have to meet substance requirements on an ongoing basis and are being strictly monitored by the Commission, he said.

"So far, there has been no breach that has been found," he said.

He said the Financial Services Commission has taken note of the Hindenburg report but the regulator is bound by the confidentiality clause of the law and cannot disclose details.

"The Financial Services Commission can neither deny nor confirm whether an investigation has been and/or is being conducted. As such, disclosure of information on global business companies would be in breach of section 83 of the Financial Services Act and may have an adverse impact on the repute of our jurisdiction," he said.

The statement came just before the Hindenburg-Adani issue comes up in Supreme Court. The apex court, which had appointed an expert committee to look into regulatory issues, is likely to take up capital market regulator SEBI's plea for a six-month extension in timelines to probe allegations against the Adani group.

Also, the Financial Services Commission is collaborating with law enforcement agencies in Mauritius and overseas regulators on the matter.