CySEC Revised Significant CIF Criteria

The Cyprus Securities and Exchange Commission (CySEC) has released revised criteria on Thursday that will define regulated financial services firms as Significant CIFs. This status will mandate the companies to have higher levels of compliance checks.

If a CIF has on and off-balance sheet assets on average greater than EUR 100 million over the four‐year period immediately preceding the given financial year, then it will be considered as a Significant CIF, according to the latest rules.

Earlier, if any CIF had total audited annual assets of EUR 43 million, or commission income of EUR 50 million, or holding client money of more than EUR 35 million, or client assets of at least EUR 750 million, they would be considered as Significant CIF.

Companies need to decide within four months of the completion of a financial year if they meet the requirements of a Significant CIF and report the status to the regulators.

Mandatory Committees

All Cypriot financial services companies that are qualifying as Significant CIFs need to form a remuneration committee and a risk committee. Further, the members of the risk committee should be members of the Board of Directors that do not perform any executive function in that concerned CIF.

Furthermore, they need to submit organizational structures with the CySEC.

Meanwhile, Cyprus remains one of the most preferred jurisdictions for forex and contracts for different brokers and their ancillary services that are targeting European clients. The regulations of CySEC are much more relaxed compared to other European counterparts. However, over the years the regulator has become extremely vigilant and is actively flagging and taking enforcement actions against non-compliant companies.