Setting Up A Cyprus Investment Firm

Setting up a Cyprus Investment Firm can be a great way to start the investment world. There are many things to consider when setting up your firm, but with the help of a good lawyer and accountant, you can make the process as smooth as possible. Learn the steps involved in setting up a Cyprus Investment Firm so that you can get started on your investment journey today.

What Is A CIF – Cyprus Investment Firm?

A Cyprus Investment Firm (CIF) is incorporated in Cyprus and regulated by CySec. These firms can provide different financial services such as underwriting, portfolio management, investment advice, reception and transmission of orders on behalf of clients, etc.

A CIF may also provide ancillary services such as custody, safekeeping, and administration of financial instruments for clients’ accounts.

CIF – Cyprus Investment Firm Types

There are different types of investment firms in Cyprus depending on their activities:

Full Scope CIF: this firm can provide a range of investment services & ancillary services based on their authorization and the clients’ needs.

Restricted CIF: this firm can offer only specific investment services & ancillary services based on their authorization and the clients’ needs. This type of company has a limited number of staff responsible for performing administrative tasks and monitoring compliance with applicable laws and regulations.

Limited License: this firm can provide only one type of investment service. It doesn’t offer any ancillary services.

Limited Activity: this firm can provide only one ancillary service. It doesn’t offer any investment services.

Out-Of-Scope: this firm is not authorized to provide any investment or ancillary services.

CIF – Cyprus Investment Firm Authorization

To set up a CIF in Cyprus, the company must obtain authorization from CySec. The application process is relatively straightforward and can be completed online.

The main requirements for authorization are that the company

  • Certificate of incorporation
  • Memorandum and Articles of Association
  • Licenses and other documents of the directors
  • Business plan for at least three years
  • Core management members
  • External auditors and internal procedures
  • KYC/AML Policy, Procedure & Manuals.

The CIF – Cyprus Investment Firm is the most popular firm in the investment services industry. The main advantage of a CIF is that it can offer a range of financial products and services, including managing funds or portfolios for clients. In addition, if you are planning to establish an online trading platform (such as Forex or CFDs), you will need to register as a CIF.

How To Set Up A Cyprus Investment Firm?

Setting up a Cyprus investment firm is relatively straightforward and can be completed in a few weeks. The following steps are required:

Register Your Firm’s Name

Coin with your firm name first and ensure that it is available. You can do this by checking the official registry of companies in Cyprus, or you may use a third-party service provider such as Company Incorporation Cyprus to check whether your desired name is available or not.

Complete an application form with CySec and submit it with other documents such as company incorporation certificate, memorandum, articles of association, directors’ licenses, etc.

Register Your Firm with the Cyprus Tax Department

Once your company has been registered with CySec, you must register it with the Cyprus tax department. You can do this online, and it is a relatively straightforward process.

Your lawyer will draft the memorandum and articles of association and will prepare your MAoA. The MAoA sets out the company’s structure, shareholders’ agreement, directors’ duties, etc. The lawyer will also submit the requirements to CySec with the application form.

Check Post-Registration Requirements/Obligation

You may need to wait several working days until your Certificate of Incorporation is issued. Next is to apply for the tax department’s TIN or Tax Identification Number. You will need to open a corporate bank account and appoint a registered auditor. Your company should also put an AML/KYC policy and procedure manual in place.

Get Your CIF License

CySEC regulates all investment firms under the Investments Services and Activities and Regulated Markets Law of 2007 (Law 144(I)/2007). The list of CySEC regulated investment firms is available on their website.

CySec offers three types of licenses for investment firms: full, limited, or out-of-scope. You can check whether your firm will qualify for one type or the other.

Licenses vary with the services you provide, which include:

  • Transmission and reception of orders related to the financial instruments
  • Portfolio management
  • Order execution on clients behalf
  • Investment advice provisions
  • Underwriting of the financial instruments and financial instrument placement on firm’s commitment basis
  • Multilateral trading facilities operation
  • Organized trading facilities operations

CySEC Submission Application Package

For you to obtain your CySEC license, there are several documents you may need to prepare in your submission:

  1. Certificate of incorporation
  2. Memorandum and Articles of Association
  3. Licenses and other documents of the directors
  4. Business plan for at least three years
  5. Core management members
  6. External auditors and internal procedures
  7. KYC/AML Policy,
  8. Clear criminal records of the management
  9. Proof of financial resources
  10. Listing of shareholding

License Activation

CySEC will activate your CIF license once you have been notified in writing by CySec that your company has met all the regulatory requirements. You are now ready to commence with your investment firm’s operations.

  • Fully operational offices located in Cyprus
  • Readily available procedures and policies in compliance with the regulations and laws
  • Provide expertise and knowledgeable personnel, and they must hold CySEC’s certificate requirements to perform their duties and responsibilities under the law effectively.
  • Completed payment of requirements to CIF by CySEC.

While the process seems straightforward, it is essential to have an excellent corporate lawyer who can help you prepare all the required documents and advise you on regulatory requirements. This way, you’ll prevent delays and unwanted surprises down the road.

Final Words

Setting up your investment firm in Cyprus is a significant business venture. It has a lot of opportunities to offer, and you can tap into these through the help of your corporate lawyer, who will guide you every step of the way. Knowing the step-by-step process of setting up an investment firm will also help you plan your business strategy.