CYPRUS INVESTMENT FIRM (CIF)
Oxford maintains specialised team with long and specific experience in the financial sector, and can assist you on the registration process of your Cyprus Investment Firm (CIF), at a minimum time after submission of the relevant application form to the competent authorities in Cyprus (Cyprus Securities and Exchange Commission (CySec)).
The Investment Services and Activities Regulated Markets Law of 2007 - Law 144(I)/2007, which implements the provisions of Markets in Financial Instruments Directive (MiFID), makes Cyprus one of the most ideal jurisdictions for permanent establishment of your investment firm, while offering to potential investors a single passport to provide investment services within the European Union.
Cyprus maintains the lowest corporate tax rate in Europe with a highly sophisticated and developed infrastructure to serve the financial services industry needs at its best.
We have put together a technical report highlighting the main features of the Law and some of the requirements to set up a Cyprus Investment Firm.
Oxford will provide you with advisory support towards authorisation and registration of the Cyprus Investment Firm and prepare the application file in accordance with the current regulatory requirements. Moreover, we can locate qualified executive and non-executive directors and personnel and provide legal accounting and auditing support for your investment firm.
Criteria for successful Cyprus Investment Firm application
The main criteria that need to be satisfied by the Commission in order to grand an authorisation are:
- Existence of the minimum capital required by law.
- A minimum of two experienced and reliable executives so that the four eyes principle is satisfied. One of these two executives should be employed by the company on a full time basis and live in Cyprus. They both should be accessible and available and appear before the Commission with reasonable notice.
- “Experienced and reliable persons” to be appointed as Directors of the CIF are not defined in the law.
- Possession of the relevant professional competence certificates from the Ministry of Finance of the Republic of Cyprus by departmental heads.
- Adequate technical and financial resources
- Adequate IT systems and internal control mechanisms
- Adequate structures and mechanisms in order to guarantee the protection of investors assets and eliminate any conflict of interest that may arise between the company or the staff and clients’ interests
Procedure for the granting of a CIF authorisation
In order to obtain a license, the interested party should submit an application to the CYSEC.
The main documents to accompany the application are:
- A business plan with description of the operations and forecasts for the fist two years.
- Draft Constitution and Articles of Association
- A Draft organizational structure of the company including the names of two experienced persons so that the four eyes principle is fulfilled.
- 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 etc.
- Excerpt of the criminal record, certificates of non bankruptcy, CVs for all the members of the Board of Directors, executives and shareholders with holding of 10% or more.
- Completed questionnaires for the above.
- 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.
The Commission must, within six months from the submission of a duly completed application for the granting of a CIF authorisation, reach a decision and inform the applicant for the granting of authorisation or rejection of the application.
During this six month period the Commission may request additional information or clarifications regarding the application submitted.
In order for a Company to offer Investment Services in Cyprus, it must apply to CySEC to obtain the relevant license to offer the following services:
- Reception and transmission of orders in relation to financial instruments as defined in the Act on behalf of investors;
- Execution of orders other than own account;
- Underwriting issues of financial instruments as defined in the Act;
- Managing investment portfolios that follow the mandates given by investors in the case of the portfolios including any number financial instruments;
- Investment Advice;
- Dealing in financial instruments pertaining to its own account.
- Safakeeping and administration of financial instruments for the account of clients, including custodianship and related services such as cash / collateral management;
- Granting credits or loans to an investor to allow him to carry out a transaction in one or more financial instruments;
- Foreign exchange services where these are connected with the provision of investment services. These services enable Companies to exchange foregin currencies at spot prices;
- Services related to underwriting.
Financial Instruments include the following
- Money-market instruments and transferable securities;
- Units in collective investment schemes;
- Options, futures, swaps, forward rate agreements (FRAs) and any other derivative contracts relating to commodities, that must be settled in cash or may be settled in cash at the option of one of the parties or that can be physically settled provided that they are traded on a regulated market and /or an MTF (not being for commercial purposes);
- Interest rate, equity and currency swaps;
Options for the future disposal or obtaining of any financial instrument, particularly currency and interest rate options as well as equivalent cash-settled instruments.
Oxford Management can assist you obtain a CIF license through the provision of the following services
- Advise on the application for the correct license so that to be able to provide the investment services wished to offer;
- Assist with the preparation and administration of the application for your CIF authorisation as well as open a bank account for you.
- Design and implement a structure organised specifically for your company, as well as prepare the business plan, due diligence manual and an internal operation manual.
- Prepare the internal regulation, focusing on the correct control mechanisms, and outsource or assist you in your non-core functions, including internal auditing and accounting functions.
- Obtain a license from CySEC for the provision of the desired investment services;
- Expanding the license to EU and non EU countries.
For more information about Cyprus Investment Firms please feel free to download our FACT SHEET No. 15 “Cyprus Investment Firms (CIF)”.