Updated: October 24, 2023
A Cyprus Investment Firm “CIF” is an entity that provides investment services and activities in the Republic. It can also be a third-country firm operating through establishing a branch in Cyprus. They shall be set, licensed, and authorized to act under the below legislation:
“Law Which Provides For The Provision Of Investment Services, The Exercise Of Investment Activities, The Operation Of Regulated Markets And Other Related Matters Law 87(I)/2017” (from now on the “Law”)
Under the same Law, the Cyprus Security and Exchange Commission (CySEC) processes applications for the licensing of Cyprus Investment Firms. It also regulates and issues guidelines and regulations on the activities and operations of the CIFs.
A Cyprus Investment Firm, depending on its license, can offer the below services:
The type of investment services to be offered are the following:
The CIF requires minimum regulatory capital to be authorized to operate. This capital must be available at the beginning of the process and kept throughout the licensed activity.
| Minimum regulatory capital requirements | ||
| Activities | Capital in Euro | |
| I. | Dealing on Own Account Underwriting or placing on a firm commitment basis | 750.000 |
| II. | Reception and transmission of orders Execution of orders Portfolio management Investment advice Placing of financial instruments without a firm commitment basis (not permitted to hold client money or securities belonging to clients) | 75.000 |
| III. | Operation of an Organized Trading Facility | 750.000 |
| IV. | With activities other than those referred above | 150.000 |
Legal identity
A Cyprus Investment firm can only exist in the form of a legal entity (company). As such, it must:
the operations of the company will be the ones of an investment firm offering investment and ancillary services
Read more about Cyprus company formation.
Substance
The CIF shall have a physical presence and a head office in Cyprus. This office can be either rented or owned. It shall also employ a sufficient number of employees to carry the business operations.
Documents
For the preparation of an application to CySEC for a CIF license, the below are needed:
Board of directors
A CIF shall have at least two executive directors and two independent non-executive directors. The majority of the board must be Cyprus residents.
Directors have to be Fit and Proper according to CySEC’s requirements:
There are no restrictions in appointing foreign nationals as directors. However, the decisions affecting the management and control of the investment firm must be taken in Cyprus. The above will allow the CIF to benefit from the favorable Cyprus Tax regime.
Other employees not being directors
Any other employees who will provide investment services and act as the Compliance Officers of the CIF must:
CySEC’s application charges:
Depending on the license type and the license extension, charges may vary.
CySEC’s annual fees (euro)
The above is calculated based on the annual audited financial statements.
CIFs that provide services in relation to CFDs shall pay an additional €3.000.
CySEC must reply within six months of submitting a duly completed application. The reply will either grant a CIF license or refuse the application.
After the initial communication, our compliance department will collect the required KYC information from the client for due-diligence purposes. At the end of stage 1, we sign an engagement letter between the client and our firm.
We design and build the CIF’s structure according to the client’s specific needs. Once this is completed, we will draft the Memorandum of Association according to the requirements of the Law. We will also provide qualified non-executive director candidates (if needed). At the same time, we will proceed with the company’s formation.
Our firm will draft and finalize the following:
The below are completed by our firm:
We assist with the provision of all the necessary documentation and certificates.
The application form (87-00-01) for the Authorization of CIFs (DOC, 188 KB).
Filing of the CIF’s application together with the supporting documentation to CySEC.
We promote the CIF’s application to CySEC. We provide CySEC with any necessary replies and maintain open communication regarding application inquiries and proposals.
Issuance of authorization certificate and registration of the CIF in the registry.
Cyprus Investment Firm’s responsibilities do not come to an end upon receiving the license. CySEC will still regulate the CIF. So it must comply with the obligations and requirements as provided by the Law and the relevant directives. Otherwise, the license can be revoked at any time.
Our firm also provides post-authorization services, which include but are not limited to:
Our team is made up of professionally qualified lawyers. Also, we have financial advisors with reputable experience in the sectors of Legal, Corporate, and Financial Services.
Due to the specific nature of the licensing process, it is crucial to acquire services from experienced and professional consultants. In cases where CySEC rejects an application, appeal procedures can take up to two years. In the meantime, the company’s shareholder(s) cannot operate anywhere in the EU.
We provide complete services for your CIF license application which include:
Our payment policy is as follow:
George K. Konstantinou
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