CYPRUS INTERNATIONAL COLLECTIVE INVESTMENT SCHEMES (ICIS)
The interest for investment funds and investment fund management in Cyprus is growing, whereas the industry has expressed its interest for the investment funds sector.
Oxford can assist you with the set up and maintenance of a Cyprus Fund.
The establishment, operation and regulation of International Collective Investment Schemes are governed by law since 1999 and regulated by the Central Bank of Cyprus. The Cyprus International Collective Investment Schemes Law follows the rules and regulations of the relevant European Directives regarding investment funds.
Cyprus investment Funds are ideal for investments to and from European Union member states. This is primarily due to the tax regime in place, which offers a range of tax planning instruments for structuring business through Cyprus.
A Cyprus Fund, is basically designed for the collective investment of funds of unit-holders. The Fund can invest anywhere in the world limited by its own investment policy.
Type of International Collective Investment Schemes
- International Variable Capital Company (open-end investment fund)
- International Fixed Capital Company (closed-end investment fund)
- International Unit Trust Scheme
- International Investment Limited Partnership
The following are the most common uses of a Cyprus Fund:
- Property investments, namely in countries having double tax treaties with Cyprus (i.e. India, Russia, Poland and others);
- Access to capital markets;
- Pooling collective investment;
- Accumulation of funds of high net worth individuals in a private fund;
- Investments in securities (as defined in Cyprus tax legislation), bonds and other financial instruments, capitalising tax free gains;
- Collective fund of several sub-fund portfolios;
- Fund of a number of other funds or sub-funds each with a specific objective, projected target return and risk profile;
- Pooling collective investment;
- Raising money from a broader circle of persons / bespoke protection regime.
- A Cyprus Fund is treated as a normal Cyprus company, therefore is subject to Corporate Income Tax at 10%, being the lowest rate in the EU.
- No tax on disposal of securities as defined by tax law (For interpretation of the definition of the term ‘Securities’ of the Income Tax Law, the following list of investment instruments are included in this term: shares, bonds, units, debentures, founder shares, options on securities and other titles of companies or legal persons and rights thereon).
- Participation exemption system on dividends received from abroad, with no minimum holding period.
- No withholding taxes on payments of dividends, interest, and royalties (subject to some conditions) paid to non residents.
- No thin capitalization rules.
- More than 45 double tax treaties.
Oxford can assist with the establishment and the ongoing management and operation of a Cyprus Fund. Our Fund services include:
- advising on the Fund structure;
- assisting with and coordinating the registration of the Fund by drafting, completing and submitting all documents and forms incidental thereto, obtaining all licenses / permits required, coordinating the Fund’s entire application to the Central Bank of Cyprus;
- providing the necessary application forms, advising as to the requirements of the applications and reviewing the documentation prior to submission;
- coordinating the Fund’s registration with the Registrar of Companies as a Company;
- acting as liaison point with the relevant authorities (the Central Bank and the Companies Registrar) for obtaining the required recognition, permissions/licensees and registration for the Fund’s operations;
- preparing and or/reviewing the private offering memorandum, memorandum and articles of association, and advising thereon to ensure consistency and compliance with the applicable law.
- Provision of administrative services including directors, secretary, registered office facilities and management, where applicable.
- Compliance services including accounting, VAT, external and internal audit, due diligence and net asset value (NAV) valuations.
KEY PLAYERS OF ICIS
For more detailed analysis in respect to Cyprus Funds you may also download our Fact Sheet No. 9 –INTERNATIONAL COLLECTIVE INVESTMENT SCHEMES (FUND).