Cyprus Investment Firms – 2022
Updated 25 May 2022
A Cyprus Investment Firm in 2022 can be set up and licensed in about six months with priority or a bout 10 months without priority. Cyprus as a destination has lately been offering a one stop shop services for the Cyprus Investment Firms.
Hence if you are providing financial services in the EU such as Portfolio Management, Forex Trading, Investment Advice, Brokerage Services etc. Or if you are in any way involved in managing discretionary accounts or even if you are a Financial Service Provider seeking to enter European Markets then a Cyprus Investment Firm (CIF) can be considered as an ideal dominion for you to provide Financial Services for customers in the EU.
The Relative Legislation for 2022
The Cyprus Investment Firms Law 144 (I)/2007 provides the legal framework for the provision of investment services, registration, regulation of undertakings and supervision of Cyprus Investment Firms. The CIF Law implements the provisions of the Markets in Financial Instruments Directive (‘MIFID’) into the domestic law.
Regulation Is Required For the Cyprus Investment Firms. If you need info on how to register a Cyprus company follow this link where you will see a wealth of information: Registration of Cyprus Company.
The primary question that every financial services professional should be asked is this: Is regulation required? Financial Services in Cyprus are regulated by the Cyprus Securities and Exchange Commission (CySEC).
CySEC’s responsibilities are as follows. Firstly, to safeguard the investors and more particularly in retail in contrast to accredited investors. Secondly, and perhaps more important, to enhance the public’s trust in financial markets so that there is a ‘healthy’ cycle going on.
How Does E.R. Team Help
Services provided by a Cyprus Investment Firm:
A. Portfolio Management by the Cyprus investment firm. This denotes managing portfolios in accordance with mandates given by clients on a discretionary client-by-client basis where such portfolios comprise of one or more financial statements.
B. Investment Services. The Provision of personal recommendation to a client, either after his request, or on the initiative of the Cyprus Investment Firm, in relation to one or more transactions related to financial related to financial instruments.
C. Dealing on own account.
D. Execution of orders on behalf of clients.
E. Reception and transmission of orders with regards to one or more financial instruments.
F. Operation of Multilateral Trading Facility by the Cyprus Investment firms.
G. Underwriting of financial instruments and/ or placing of financial instruments on a firm commitment basis.
H. Placing of financial instruments without a firm commitment basis.
Cyprus Investment Firms: Capital Requirements in 2022
The required capital for Cyprus investment firms depends on the services that the investment firm in question intends to provide. By implication, according to the decision as to what services will be applying for authorization, it can be measured how much share capital is required. The minimum share capital requirement is intended as a tool for assessing whether the Cyprus Investment Firm has enough own capital to meet obligations.
The initial issued and paid up share capital for Cyprus investment firms required depends on the activities which will be provided.
First, the minimum initial capital for Cyprus Investment Firms holding client’s assets and providing any of the following is €125.000:
A. Investment Advice.
B. Portfolio Management.
C. Execution of orders on behalf of clients.
D. Reception and transmission of orders.
Second, the minimum initial capital for Cyprus Investment Firms providing reception and transmission of orders and/or investment advice without handling clients’ assets is €80.000 or €40.000 plus professional indemnity insurance covering all Members States.
Third, the minimum initial capital for a CIF providing and/or conducting any of the following is €750 000:
A. Placing of financial instruments without a firm commitment basis.
B. Underwriting/placing of financial instruments on a firm commitment basis.
C. Operation of MTF.
D. Dealing on own account.
For opening a Cyprus bank account for your Cyprus investment firm our firm can assist you also and open a bank account for you in Cyprus and/or many other countries. For more information on how to open a Cyprus Bank Account follow this link. Your will find there information and advice very useful for opening a bank account in Cyprus.
Main documents for Cyprus investment firms license in 2022:
a. A business plan with description of the operations and forecasts.
b. Draft Constitution and Articles of Association. This includes the names of two experienced persons so that the four eyes principle is safeguarded.
c. An operations manual which contains internal procedures for the services to be provided, money laundering procedures, description of the IT system and infrastructure of the company and so on.
d. Excerpt of the criminal record, certificates of non‐ bankruptcy, CVs for all the members of the Board of Directors, executives and shareholders with holdings of 10% or more.
e. Completed questionnaires for the above.
f. A confirmation that the applicant possess or will possess the capital required as its initial capital and that it will undertake to block it in a bank account held by a credit institution or institutions of a member state, when and if the Commission so requests.
This publication has been prepared as a general guide for information purposes in our website. It is not a substitution for professional advice. One must not rely on it without receiving independent advice based on the particular facts of the case. No responsibility can be accepted by the authors or the publishers for any loss occasioned by acting or retaining from acting on the basis of this publication.