Regulation

Overview

Is third-party litigation funding permitted? Is it commonly used?

We consider that third-party litigation funding is permitted in Mauritius, although it is neither provided for nor prohibited by any legislation or otherwise regulated. Third-party litigation funding is not common and has not been the subject of any judicial pronouncement. Further, the common law torts of champerty and maintenance have very rarely been invoked in case law and never in the context of third-party litigation funding. It is doubtful whether the courts would find that those torts form part of Mauritius law today, but to the extent that they do, the courts are likely to be guided by the development and eventual abandonment of those concepts in England.

Although third-party litigation funding is not commonly used in Mauritius, it is increasingly being considered, especially by parties to complex arbitration matters and enforcement proceedings before the Supreme Court of Mauritius where the value of the claim involved is significant. In those cases, litigants have recourse to funders established internationally, England being the most popular market.

To date, however, there is no public information available on cases in which parties have resorted to third-party litigation funding.

Restrictions on funding fees

Are there limits on the fees and interest funders can charge?

In the absence of any legislation or regulation governing third-party litigation funding, there is no limit on the funders’ fees and interest.

Specific rules for litigation funding

Are there any specific legislative or regulatory provisions applicable to third-party litigation funding?

There is no legislative or regulatory provision that is applicable to third-party litigation funding. Where the litigation funding involves an assignment of a litigious right and the funder steps in the shoes of the litigant (and thus ceases to be a third party), article 1699 of the Mauritius Civil Code provides that the person against whom the litigious right has been assigned may obtain a release from the assignee by reimbursing him or her the actual price paid for the assignment, plus costs, reasonable expenses and interest calculated from the date on which the assignee paid the price for the assignment made to him or her.

Legal advice

Do specific professional or ethical rules apply to lawyers advising clients in relation to third-party litigation funding?

The general rules provided in the respective Codes of Ethics for attorneys and barristers would be applicable but there is no specific rule in relation to third-party litigation funding. Unless the litigious right is assigned to the third-party funder, the lawyers’ client remains the litigant and they owe their duty of care and confidentiality towards the latter and not to the third-party funder, despite any agreement that the funder will be responsible to pay their fees. Attorneys and barristers may, however, receive instructions from a third party designated and mandated by their client to represent them.

Regulators

Do any public bodies have any particular interest in or oversight over third-party litigation funding?

The Financial Services Commission regulates the provision of financial services (other than banking, which is regulated by the Bank of Mauritius) in Mauritius but the scope of the Financial Services Act does not include third-party litigation funding. Neither the Financial Services Commission nor the Attorney-General’s office has so far expressed an interest in regulating the third-party litigation funding sector. However, it is expected that discussions on the regulation of third-party litigation funding will become necessary in the near future in light of the growth of the international arbitration sector in Mauritius and the government’s effort over the last decade to promote the use of Mauritius as a jurisdiction of choice in the field of international arbitration by passing the International Arbitration Act (inspired from the United Nations Commission on International Trade Law (UNCITRAL) Model Law), the establishment of a permanent branch of the Permanent Court of Arbitration of The Hague in Mauritius, the hosting of the Congress of the International Council for Commercial Arbitration in 2016 and the launch of the MIAC Arbitration Centre in July 2018.