The Cyprus Securities and Exchange Commission (CySEC) is going to allow eligible United Kingdom-based financial services companies that are operating under the Temporary Permissions Regime (TPR) to operate in Cyprus even after the deadline of December 31, 2021.
Only the companies seeking to establish a physical presence in Cyprus and applying for a new regulatory license or obtaining it through acquisition will be allowed to continue operating under the TPR.
They will be allowed to operate under TPR until their applications are reviewed by CySEC. If their application is approved, they will receive another six months to onboard clients and commence operations fully.
This step, according to the regulator, will allow a smooth transition for UK group companies to establish their operations in Cyprus.
Covering Brexit
CySEC introduced the TPR in December 2020 after the confirmation of Brexit , allowing dozens of UK companies to temporarily continue their services for European clients. But, they were only allowed to offer services to counterparties and/or professional clients based in Cyprus.
Additionally, the regulator revealed that it received 96 applications after Brexit that were willing to join the TPR program, but only 88 were allowed as the rest did not meet the requirements.
“Amongst the groups of the TPR Entities (the ‘TPR Groups’), several sought to continue their solicited activities in Cyprus, and in this context, relevant applications have been submitted to CySEC,” the regulator stated.
“It should be noted that the applications received by CySEC are reviewed in order of priority, creating a series of challenges as it comes to the evaluation’s completion in a timely manner. Considering that reviewing applications that entail the establishment of a physical presence within the Republic is a cumbersome procedure, CySEC has decided to proceed with amending Directive 87-04, allowing companies operating under TPR to continue to operate under this regime, until the relevant application is reviewed.”
The regulator will publish a list of all the financial services companies under the TPR on January 1, 2022, that will be allowed to operate following the deadline.
