About Cyprus Investment Firm (CIF)
Cyprus has fully adopted all EU Directives and Regulations that effect investment services and financial markets. Under the conditions of the prevailing MiFID II related legislation, an investment firm licensed by the Cyprus Securities and Exchange Commission can effectively offer its services throughout the EU under the “passporting” conditions of its authorization.
Ownership and Management
The ownership of a Company applying with CySEC must be fully disclosed and the Board of Directors must consist of at least two executive directors and two independent non-executive directors.
The executive directors that effectively manage the Cyprus Investment Firm (CIF) must prove knowledge, experience and integrity, and be employed fully by the CIF to ensure professional, safe and prudent management of the company.
Head Office and Organization
The head office of the CIF must be located in the Republic of Cyprus. It must be fully staffed, and persons performing any of the licensed investment services must hold the appropriate CySEC Certificate. CIF’s are required to comply with a number of organizational provisions. Some of them are:
A Cyprus Investment Firm has to establish defined policies and procedures that ensure company’s compliance with all legal obligations. The CIF must have an independent compliance unit staffed with eligible persons.
The organization and administration of a Cyprus Investment Firm (CIF) must be designed in such way that it prevents conflicts of interest.
A Cyprus Investment Firm must have a clear risk policy which must be implemented and controlled by a separate risk management unit.
A Cyprus Investment Firm (CIF) must be member of the Investment Compensation Fund for Clients and must comply with its obligations.
The following Investment Services and activities are regulated and subject to granting of a license prior to business initiation:
- Reception and transmission of orders;
- Execution of orders on behalf of clients;
- Dealing on own account;
- Portfolio management;
- Investment advice;
- Underwriting and/or placing of financial instruments on a firm commitment basis;
- Placing of financial instruments without a firm commitment basis;
- Operation of Multilateral Trading Facilities.
The minimum paid-up share capital of a Cyprus Company applying for a Cyprus Investment Firm license depends on the services and activities that shall be offered and provided. The required minimum paid-up capital must be retained at all times.
For a Cyprus Investment Firm (CIF) that holds clients’ assets and/or financial instruments the minimum paid-up capital is EUR 125.000. The following services may be offered or provided:
- Reception and transmission of orders
- Execution of orders on behalf of clients
- Portfolio management
- Investment advice
For a Cyprus Investment Firm (CIF) that offers or provides the above-mentioned services without holding clients’ assets and/or financial instruments, the minimum paid-up capital requirement is EUR 50.000.
CIF’s that offer all other services are required to hold capital of at least 730,000 euro.
Regulatory license allows entity to offer services across Europe
Attractive Tax environment
Operate within a European regulatory framework with a responsive and experienced regulator
CySEC’s framework provides class-rivalling costs and time-to-market, with globally competitive minimum capital requirements
CySEC offers wide range of Financial Services Activities and Market opportunities
Cyprus has a strong network of financial and professional service providers who have highly skilled, educated and multilingual teams specialized in servicing the fund industry and today offer a wide range of customized services in fund and asset acquisition structuring, fund administration, custody, audit and other related services.
Advanced And Attractive Tax Environment
Cyprus has one of the lowest corporate income tax rates in the EU and the Eurozone while being compliant with the EU Directives and OECD requirements. Fund management services offered to authorized funds are in principle exempted from VAT. Generally, Cyprus is considered to be a beneficial jurisdiction offering numerous and significant options for international tax planning, both at a corporate and individual level with an extensive Double Tax Treaty network with more than 60 countries.