The emerging crypto industry is still unchartered waters in many regards. But the Cyprus Securities and Exchange Commission is working towards eliminating the regulatory gaps and ensure the highest level of investor protection. The Successful Business Magazine asks the Commission head, Dr George Theocharides, about the current crypto landscape in the EU and in Cyprus and the recent and forthcoming regulatory developments.

In your opinion, what are the greatest regulatory risks that Cyprus faces today?

The trends that we have seen in the last decade or so in financial services are more digitalisation, more online, and mobile trading platforms. We have also seen more sophisticated technologies, such as artificial intelligence, algorithmic trading, blockchain technologies, machine learning, Big Data Analytics, Robo-Advisors, and social trading.

Obviously, these global trends bring many opportunities, but at the same time, they come with risks relating to the protection of the investors, to cases of money laundering and terrorist financing, and risks around cybersecurity.

As regulators, we need to be proactive in understanding these new technologies and how they impact financial services in order to mitigate the risks and protect investors. It is essential that investors understand these risks before proceeding with any investment, so they are not lured into unsuitable investments based on inaccurate or incomplete information. Inconsistent liquidity, unregulated price discovery mechanisms, insider dealing and market abuse in relation to crypto-assets, lack of pre- and post- trade transparency rules, all undermine investor protection. The nature of cryptoassets, which means they are to some extent anonymous or pseudo-anonymous and can be used in the context of electronic contactless transactions and from anonymous crypto wallets and other emerging products, also makes them vulnerable to the risk of money laundering and the financing of terrorism.

What's the solution then?

When it comes to digital assets andWhen it comes to digital assets andcryptoassets, the regulation is evolving. There is a lot of work being done both atThere is a lot of work being done both atthe national and European level. A fewmonths ago, the Cyprus Securities andExchange Commission (CySEC) issueda Policy Statement on the Registrationand Operations of Crypto Asset ServicesProviders (CASP) to outline its finalisedrules for CASPs under the AML/CFTLaw. Additionally, we issued the CASPRegistration Directive and the Directivefor the Prevention and Suppressionof Money Laundering and TerroristFinancing, which elaborates on the nextsteps for CASPs and CySEC’s expectations.We expect Crypto Asset ServicesProviders to abide by their obligationsstemming from CASP Rules, includingbut not limited to their obligationsamong others on:

- the fitness and probity of the CASPBeneficiaries and persons holding a management position

- performing Know Your Client and other client due diligence measures

- drawing the economic profile and identifying the source of funds of their clients

- identifying and reporting suspicious transactions, and

- undertaking a comprehensive risk assessment in relation to their clients and activities and take proportionate measures per client, activity and cryptoasset in question.

Details can be found on the CySECDetails can be found on the CySECwebsite, www.cysec.gov.cy.

CySECalso continues to analyse market practicesand will assess the effectiveness ofexisting rules. Where necessary, we willact to issue further guidance to ensurethe compliance of supervised entitieswith the regulatory framework. CySECexpects these kinds of initiatives toalleviate some, but not all, of the risksinvolved in cryptoasset space, and wewelcome developments at EU level,under the proposed Regulation on Marketsin Crypto Assets (MiCA).

In September 2020, the EuropeanCommission proposed a new regulationon cryptoassets (MiCA). This regulationwill form part of the EU’s Digital FinanceStrategy and is expected to significantlyimpact the operation of the crypto marketin the EU. It will increase consumerprotection by establishing clear cryptoindustry conduct and introduce newlicencing requirements. This proposal,which covers cryptoassets falling outsideexisting EU financial services legislation,as well as e-money tokens, has four generaland related objectives.

The first objective is one of legalcertainty. For cryptoasset markets todevelop within the EU, there is a needfor a sound legal framework, clearlydefining the regulatory treatment ofall cryptoassets that are not covered byexisting financial services legislation.The second objective is to support innovation.The development of cryptoassetsand the wider use of DLT requires a safeand proportionate framework to supportinnovation and fair competition. Thethird objective is to instil appropriatelevels of consumer and investor protectionand market integrity given thatcryptoassets not covered by existingfinancial services legislation presentmany of the same risks as more familiarfinancial instruments. Finally, thefourth objective is to ensure financial stability. 

Cyprus has attracted a numberCyprus has attracted a numberof large CIF companies and someconcentrate in CFDs. These tendto have hundreds of thousands oftrading accounts and millions oftransactions every day. Are youconfident that Cyprus' currentregulatory system is adequate toprotect investor interests in companieslike this?

EU financial regulation applies uniformlyto all EU Member States, savefor certain minor Member State discretionsprovided for in the respective EUlegislation. As a result, investment firmsdomiciled in any of the EU MemberStates must abide to the same rulesand in return, benefit from the right tofreely provide their services throughoutthe EU. The regulatory and supervisorylandscape of the financial sector inCyprus mirrors that of the rest of the EUso that investors benefit from the highstandards of protection we enforce.

I should also mention that – untilI should also mention that – untilMiCA becomes effective – a nationalBill has been drafted by the Ministry ofFinance (an Umbrella Law) to regulate the development of DLT-Blockchainthe development of DLT-BlockchainTechnology/Smart Contracts and providelegal certainty to this market.Under this Bill, CySEC is empowered todraft other legislative amendments if itdeems necessary for further regulatingthe provision of investment services inthis space.

Clearly, there is a high level of demandClearly, there is a high level of demandglobally for these products. CySEC hasalways held the belief that regulatingthese products appropriately is the safest,most diligent way of allowing thesefirms to provide these services, and ismost in line with serving investors’ interests.We continually assess and monitorregulated entities to tackle any concerningpractices to ensure that investorsprotection is not compromised. Since2015, CySEC applies a risk-based supervisoryapproach, which governs howwe determine the entities and marketsegments that pose the greatest risks toinvestors, and which are subject to theclosest scrutiny.

Our risk-based supervisory approachfollows the same blueprint for supervisionof other European supervisors andwe have been in constant and close collaborationwith ESMA and IOSCO.

According to our annual SupervisoryAction Plans, each year both onsiteinspections and desk-top reviewsare undertaken on supervised entities,together with full audit inspections orthematic or targeted basis. As a result,CySEC imposed more than €10 millionadministrative fines only for CIFs. Italso suspended the licence of more than30 CIFs, which had significant problemsand called upon them to take a numberof corrective measures to improve theirinternal procedures, regulations andpractices in order to fully comply withtheir legal obligations. In addition, CySECrevoked the operating licence of morethan 15 CIFs, in which serious violationsof the legislation were identified and asignificant number of CIFs voluntarilyresigned from the licence they held.CySEC will continue to conduct in-depthaudits and take all the appropriate actionsto safeguard investor protection and thesmooth functioning of the market.

Also, we are in the process of developingAlso, we are in the process of developingnew procedures and a methodologyto conduct data-driven supervision,which will allow us to identify anyirregularities and risks in the market atan early stage. In this respect, CySEC isresponding to the need to manage BigData with RegTech systems that willuse Artificial Intelligence and CloudComputing. These solutions will enableCySEC to quickly screen data, representinglarge and varied trading volumes,in order to automatically detect risksand irregularities at an earlier stageand, thus, be able to react more quicklyagainst these risks.

A recent CySEC Policy StatementA recent CySEC Policy Statementessentially required investmentservices to be ring-fencedfrom crypto-asset activities. Whatis the rationale underpinning thisapproach?

There is very straight-forward reasonfor this – we don’t want to see issues spillover into investment services from otheractivities such as cryptoasset activitiesthat are not fully regulated.

Do investors in Cyprus understandthe risks of investing in cryptocurrencies? Is CySEC educatinginvestors about these risks?

Right now, what we are seeing aroundthe globe is a lot of hype around cryptoassets;I would even call it irrationalexuberance. This is understandablebecause in the financial markets a newproduct creates a lot of attention similarto the dot.com bubble in the late 1990sor the complex, securitised financialproducts in the 2000s. But I think themarket still has a lot of informationto digest and understand, particularlyin terms of what cryptocurrencies are,how the mechanics of cryptocurrency work, what their purpose is and whatwork, what their purpose is and whatthe risks are.

There is a general lack of knowledgeThere is a general lack of knowledgeamong investors around the globe interms of cryptoassets. Providing knowledgeand education around cryptoassetsand improving financial educationand skills in general is part of the role ofthe regulators. CySEC undertakes variouseducative actions and initiatives,through publications on its websiteand in the media. CySEC participatesin World Investor Week 2021, with theaim of contributing to the global driveto educate and protect investors. Overthe past year, CySEC has been part ofa national effort and is participating atthe ad-hoc Committee for Financial Literacyand Investor Education, togetherwith the Central Bank of Cyprus, theMinistries of Education and Financeand our two state universities to createa national strategy for financial literacy.The aim is to submit the national strategyto the Council of Ministers in early2022. But while education is part of ourmandate, it’s also the responsibility ofmarket participants and the professionalsof the industry to educate investorsabout these types of assets by providingthem with the necessary information inorder to understand if the assets matchtheir needs.

What can investors do to identify/What can investors do to identify/avoid crypto and CFD fraudand scams?

The most important thing investorsmust do when considering an investmentis to do some research into thecompany offering the product or service,and consider whether seeking independentprofessional advice from anotherregulated entity might be appropriate.CySEC has a full list of all the companiesit regulates on its website, which iseasy to check. If a company is not listedby CySEC or another EU competentauthority and is fraudulently claimingto be a licensed firm, investors will nothave the same protections they wouldhave had with a regulated entity. It iscritical that investment firms classifytheir clients in an appropriate mannerso that more sophisticated, and oftenhigher-risk products and services areonly targeted at professional investors.This marketing process must be fair andnot misleading.

CySEC regularly updates its ‘Warnings’website on prevalent scamsand nefarious operators. Investors areencouraged to keep an eye on this sothey are aware of what types of fraudand scams are being tried.

Typically, investors should be especiallywary if they feel under pressure tomake a decision to invest quickly (suchas a time-limited offer), or are offeredreturns on their investment that soundtoo good to be true, or are told aboutproducts or services that don’t adequatelyexplain the risk of losing money.

CFD trading is inherently speculative,and firms must uphold their responsibilityto warn their clients that their capitalis at risk. Aggressive cold-calling tacticseither by phone, email, online pop-ups,or on social media are also likely to beperpetrated by unscrupulous providersrather than by reputable players inthe market. In the past, we have alsoobserved cases where people have fraudulentlypresented themselves as CySEC representatives in an effort to defraudinvestors. For this reason, CySEC hasissued several announcements informingthe public that it never sendsunsolicited correspondence to investorsor members of the public, nor does itever request any personal data, financialor otherwise.

As we move into a more digitalAs we move into a more digitalworld, the number of risks toinvestors is growing constantly.This is not only due to platformrelatedfraud or illicit activity, butalso due to hacking and cybersecurity.Does CySEC take cybersecurityinto account when auditingregulated firms that use investorsdeposits or accounts? Will you bedoing this in the future?

Data security is an organisationalrequirement under the investmentlaw. CIFs must have sound securitymechanisms in place to guarantee thesecurity and authentication of the meansof transfer of information, minimise therisk of data corruption and unauthorisedaccess, and prevent information leakagein order to maintain the confidentialityof the data at all times. It’s part of CySECsupervisory action plan each year.

What are your plans for theWhat are your plans for thenearest six months? What to expectfrom CySEC?

Our goal as CySEC is to continueacting as a protective shield for investorsthrough effective supervision andguiding the sound development of thesector. As part of our mission we areincreasing the level and the frequencyof supervision, particularly of online tradingplatforms, by expanding our internalresources. Given the internationaland largely web-based nature of theactivities of CIFs, CySEC has acquired asupervisory system for monitoring thesupervised entities’ online marketingactivities/materials. This tool will thereforefurther enhance CySEC’s ability tocollect, analyse, and monitor the marketingcommunications of CIFs. In terms ofpolicy making our aim is to consult onenhancing the clients’ money rules bymid to late 2022.

In addition, we have received fundingapproval from the EU Recoveryand Resilient Fund to explore the opportunityof transforming our InnovationHub into a Regulatory Sandbox. In thiscontrolled environment, fintech startupsand other entities will be able to testtheir innovative products or servicesin real conditions under the regulator’ssupervision.

We are also launching the Trust RegisterPortal which will keep the details ofthe beneficial owners of express trustsand similar legal arrangements. ThePortal is an additional tool to improvetransparency and combat money launderingand terrorist financing.

CySEC is also introducing new examsfor the providers of financial informationin regulated entities as part of the financialeducation of industry professionalsto ensure a high standard of service.

In 2020, CySEC added a newIn 2020, CySEC added a newregulatory category, Mini Managers,and a new investment product,Crowdfunding. What has beenthe reaction to these so far? Isthere scope to introduce other newregulatory categories?

Although the initial reaction has beenAlthough the initial reaction has beenfairly slow, we have recently approvedthe licence of the first mini managerand also pre-approved the licence of thefirst crowdfunding platform. Once thesenew entities start operating, and if theyend up being successful, I do see a trendtowards more applications in the futurefor both mini-manager and crowdfundingplatforms.

CySEC is also introducing a newregulatory category for fund administrators.The draft law will be submittedto the Ministry of Finance in 2022. Thefund administration is not regulatedat EU level; however, we believe thatregulating these entities will contributeto enhancing investor protection andmarket integrity by ensuring authorisationand supervision throughout thedelegation chain.

We are also looking at loan originationand loan participation for the fundsindustry. In many countries, there arerestrictions on these so we are beingcautious to make sure we address therelevant risks.

Environmental, social and governance-Environmental, social and governance-related factors are rapidlybeing integrated into the institutionalframework of the capitalmarkets. How ready are the regulatedentities to adopt the specificcriteria?

As in the case of any new regulation notonly in Cyprus but at EU and global level,we expect that there will be challengesin the application of ESG until a level ofmaturity is reached. Market participantsand investors are not fully informedabout what ESG entails and while someregulations have been passed in Europe,there's still no uniformity of regulatorypractices and approaches. There is alwaysthe risk of greenwashing or mislabellinginvestments towards ESG. If you havean investment that labels itself as ESG,somebody needs to approve it, somebodyneeds to rate it, but the criteria for thisare not clear yet. More work needs to bedone at national and EU level to createsustainable growth in this market.

In Cyprus, although we are yet to seeIn Cyprus, although we are yet to seea large-scale shift towards responsibleinvestments, we have already signed upa few alternative investment funds withan investment policy focusing on ESGfactors. Data gathered from asset managersin Cyprus showed that €40.2 millionof funds under management have asustainable investment strategy, whichis indeed a very promising step in theright direction. To encourage and assistinvestors and regulated entities in thisregard, and in line with the EU actionplan for financing sustainable growth,CySEC has confirmed its commitmentto fostering compliance with sustainablefinance standards, and in early 2021 wecreated a dedicated section on our websiteon sustainable finance, which givesinformation on the legislative measuresbeing introduced at the EU level.

Dr George Theocharides
Chairman of the Cyprus Securities and Exchange Commission (CySEC)

Dr Theocharides served as CySEC’s Vice Chairman since July 2020 andwas appointed new Chairman in 2021. As an Associate Finance Professor atthe Cyprus International Institute of Management (CIIM) and Director of theMSc in Financial Service Programme from September 2010 until July 2020, hehas extensive work experience in the wider financial sector.

Prior to joining CIIM, he worked as an Assistant Professor of Finance atthe Sungkyunkwan University of South Korea and as an International FacultyFellow at the Sloan School of Management of the Massachusetts Institute ofTechnology (MIT).

In the past, he served as a member of the Board of the Cyprus Securitiesand Exchange Commission, a member of the Interim Board of Bank of Cyprus,Chairman of the Board of the Cyprus Blockchain Technologies Ltd, as well as amember of the Board of Directors of the Cyprus-Kuwait Business Association.He also served as a member of the Training/HR Committee of the CyprusInvestment Funds Association (CIFA), as well as a non-executive member of theBoard of Directors for a number of organisations and companies in the financialservices sector.

He is also an Associate member of the Chartered Institute forSecurities & Investment (CISI) and a Research Associate at the UCL Centre forBlockchain Technologies (UCL CBT).

Dr Theocharides holds a degree of BEng (Hons) in Electrical Engineering &Electronics from the University of Manchester (U.M.I.S.T.), an MBA from theUniversity of San Diego, and a PhD in Finance from the University of Arizona.

Today more than ever, wealthy families are faced with new risks, challenges, and changing needs both for the business and the family. Family Offices are evolving to meet these needs:

Protect the family wealth through effective asset protection, investment management, and succession planning.

Enhance family cohesion and transition between generations regarding the family’s legacy, strategy, values, and key decisions.

Exercise better control over family holdings/assets through the right governance.

Manage the various risks facing the family (including investment risk, reputation risk, etc.) by proactively preparing for various eventualities.

Manage all aspects of family needs and affairs, by providing the relevant support and alleviating administration burden.

PWC: WHY DO PEOPLE CREATE FAMILY OFFICES?

The rapidly transforming socioeconomic scenery, increasing complexity, scrutiny, and new regulatory requirements are some of the reasons why many wealthy families set up their own Family Office to better control their wealth and handle their private affairs. Since every family has its own unique set of circumstances, there are as many types of family offices as there are families. Some provide administrative support while others oversee the management of investments and coordinate all of the family's financial and personal/lifestyle needs.

K. TREPPIDES & CO: SUCCESSION PLANNING AND NEXT GENERATION – WHAT IS THE DANGER?

The ideal scenario for a family business is to continue to grow for future generations without any difficulties. However, it might be difficult to find the right successor within the family to lead the business into the future.

NEXT GENERATION

The next generation might not be interested in a position within the family office or might not have the capabilities to lead the office after the current generation steps down. However, it might also be the case that some of the youngest family members are willing and capable to take over the family office functions, but at the end there can only be one prevailing chief executive officer.

On the contrary, non-family members might be better qualified to take over the role and therefore to run the business in a more efficient and effective way.

IMPLIED RULE OF 92%

The rule states that the 92% of a family’s wealth is lost by the third generation. The main reason behind this is that families tend to focus merely on ‘hard needs’ (such as business operations, investment strategy, and assets allocations) at the expense of recognising the importance of ‘soft needs’ (such as succession planning, philanthropy, and the responsibilities associated with having access to such vast sums of wealth).

Historically, having a poorly implemented succession plan, or no succession plan, can contribute significantly to families losing almost all their wealth by the third generation. To prevent this, the establishment of a family office has an implacable role to prove that the said rule is wrong.

The submission of data concerning beneficial ownership is due by 12 March 2022 in accordance with the relevant announcement of the Department of Registrar of Companies and Intellectual Property.

LEGAL BACKGROUND

In early 2021, the Cyprus government transposed the 5th EU Anti-Money Laundering (AML) Directive into Cyprus legislation, amending the Law for the Prevention and Suppression of Money Laundering Activities.
Consequently, all companies and other legal entities that are incorporated or registered in the Republic of Cyprus are now obliged to identify and record onto the Beneficial Ownership (BO) Register all relevant information about their beneficial ownership.

DEFINITION OF BENEFICIAL OWNER

In accordance with the law, a beneficial owner is defined as any natural person(s) who ultimately owns or controls the Obliged Entity and/or the natural person(s) on whose behalf a transaction or activity is being conducted and includes at least:

a. for corporate entities: the natural person(s) who ultimately owns or controls a legal entity through direct or indirect ownership of a sufficient percentage of the shares or voting rights or ownership interest in that entity, including through bearer shareholdings, or through control via other means. A shareholding of 25% plus one share or an ownership interest of more than 25% in the customer held by a natural person shall be an indication of direct ownership.

b. for trusts: the settlor; the trustee(s); the protector, if any; the beneficiaries, or where the individuals benefitting from the legal arrangement or entity have yet to be determined, the class of persons in whose main interest the legal arrangement or entity is set up or operates and any other natural person exercising ultimate control over the trust by means of direct or indirect ownership or by other means.

c. for legal entities such as foundations and legal arrangements similar to trusts: the natural person(s) holding equivalent or similar positions to those referred to in point (b) above.

OBLIGED ENTITIES

Entities considered as ‘obliged entities’ are the following:
• Companies incorporated or registered under the Companies Law Cap. 113
• European Public Limited Liability Companies Based on a legal opinion recently obtained from the Attorney General’s Office, partnerships are considered to be legal entities and as such they must disclose BO details in the register. This will be implemented with system amendment for which a relevant announcement will be published by the Registrar of Companies in due course.

The Directive does not apply to the following entities:
• Companies listed on a regulated market that is subject to disclosure requirements consistent with EU law
• Companies whose directors submitted an application for strike off pursuant to Article 327 (2A) (a) of the Companies Law, prior to the commencement of the Directive (12 March 2021)
• Companies whose liquidation has been enacted before the commencement of the Directive (12 March 2021)
• Overseas companies (branches).

All entities whose strike off or liquidation has been enacted after 12 March 2021 are obliged to record the details of their beneficial owners in the BO Register.

The law also provides for the creation of a BO Register for trusts. The information to be entered in the register shall include the identity of the settlor, the trustee, the protector, the beneficiaries and any other natural person exercising effective control over the trust. The information will not be accessible to the public, but it can be accessed only by competent regulators or supervising authorities. This register shall be maintained by the Cyprus Securities and Exchange Commission (CySEC); however, no official guidance has been issued yet.

Full version of this article is available at www.cy.andersen.com

Паромное сообщение с Европой восстановится весной 2022 г. Статистика от Cystat. В кипрских банках растет количество депозитов и снижается доля заемных средств.

28 января 2022 г. закончился срок подачи заявок на создание пассажирского морского сообщения между Кипром и Грецией. 25 ноября 2021 г. был объявлен тендер. К участию в конкурсе проявили интерес нескольких компаний. “Представленные тендерные заявки будут рассматриваться в соответствии с положениями законодательства”, - говорится в сообщении Подминистерства шипинга.

Руководитель ведомства Василис Димитриадис заявил, что “мы пока не празднуем победу, но считаем это важным шагом. Интерес компаний к проекту объясняется пересмотром условий контракта, переработкой тендерной документации и, главное, увеличением субсидии от ЕС для исполнителя контракта. Ожидается, что победитель, выбранный из трех кандидатов, будет объявлен в период с конца февраля по начало марта 2022 г. Паромное сообщение, по предварительным оценкам, начнется в апреле или мае 2022 г. Что касается порта отправления с Кипра, который будет использоваться для паромного сообщения, то это будет зависеть от оператора-победителя”, - сказал В. Димитриадис.

***

Депозиты в кипрских банках на конец 2021 г. составили 51,52 млрд. евро, говорится в отчете ЦБ Кипра, опубликованном 28 января 2022 г. Эти цифры свидетельствуют об увеличении депозитов на 3,31 млрд. евро по сравнению с декабрем 2020 г. Общий объем кредитов на конец декабря 2021 года составил 29,9 млрд. евро, что на 870 млн. евро меньше, чем в декабре 2020 г. Данный факт свидетельствует о сокращении доли заемных средств в кредитных портфелях кипрских банков. Ликвидность в банковской системе Кипра на конец 2021 г. составила 21,6 млрд. евро.

Статистическая служба Кипра (Cystat) объявила в пятницу, что уровень промышленного производства в ноябре 2021 г. достиг самого высокого уровня за 11 лет. Согласно отчету, индекс промышленного производства вырос до 132,6 единиц, зафиксировав рост на 4,4% по сравнению с ноябрем 2020 г. За период с января по ноябрь 2021 г. индекс увеличился на 7,8% в годовом исчислении. По данным Cystat, в ноябре 2021 г. в производственном секторе зафиксирован рост на 5,1%, по сравнению с ноябрем 2020 г. Увеличение наблюдалось в секторе добычи полезных ископаемых (8,3%), а также водоснабжения и утилизации отходов (8,2%).

По материалам cyprus-mail.com

The Cyprus Investment Funds Association (CIFA) announced that the investment fund sector enjoyed significant growth during 2021, with the total amount of Assets under Management (AuM) increasing by 48.7% despite the adverse effects of the pandemic.

“The sector is now established as one of the most promising of the Cypriot economy and one of the fastest-growing at a European level,” CIFA said in a statement, adding that it wishes to express its “satisfaction with the sector’s course and believes that its upward but sustainable growth will continue in 2022”.

According to a recent report by the Cyprus Securities and Exchange Commission (CySEC), Assets under Management of Cypriot funds reached €11.6 billion at the end of the third quarter of 2021, a year-on-year increase of 48.7%. Moreover, CySEC added that it currently supervises 298 Management Companies and Undertakings of Collective Investments (UCIs), a 9.1% increase year-on-year.

CIFA explained that the legislative and tax framework that governs Collective Investments in Cyprus is comparable to other European investment destinations, while the cost of establishing and operating these organisations is noticeably lower. “It consists of no coincidence that, according to data from the European Fund and Asset Management Association (EFAMA), 47% of the Cypriot Investment Funds net assets were related to cross-border investments in 2020,” CIFA said. “This ranks Cyprus fourth in Europe, with Ireland, Luxembourg, and Malta as the only European countries ahead,” the association added.

In terms of how the investment fund sector contributes to the Cypriot economy, CIFA said that roughly 140 collective investment organisations invest in Cyprus, in part or fully, with the full amount reaching €2.3 billion at the end of the third quarter of 2021, explaining that this represents 19.5% of the total amount of Assets under Management.

“During the new year ahead, we will continue our targeted actions to extend the promotion of the sector abroad, in specific markets which present concrete prospects,” CIFA president Andreas Yiasemides said.

“The Cypriot Investment Funds’ assets have already approached €12 billion, under adverse conditions, and this makes us very confident that with correct and stable steps we will achieve the medium-term goal we have set: to raise the assets of the funds in Cyprus to €25 billion,” he added.

M. Target Group was established in 2014 in Cyprus, a perfect location for globally oriented companies and high-net-worth individuals; starting as a medium-size firm offering accounting, tax planning and consulting services, over the years it has built a solid reputation for balancing strategic thinking with a ‘can-do’ approach as well as a loyal base of both local and international customers, while expanding into new fields and new markets with a focus on a proactive approach to addressing challenges of the changing business environment.

KEY BRANDS

At present, M. Target Group is represented by four well-reputed brands that provide a wide range of professional services, from accounting and business consulting to facility management and company incorporation and administration. We assist our clients with corporate structuring, tax optimisation, due diligence, risk assessment tasks, and more. 

M. TARGET BUSINESS CONSULTANTS LTD is the oldest company of the Group, providing high-level professional services in such fields as business consulting, accounting, and international tax structuring.

MITHRIDATES LTD is a facility management company offering serviced offices for local and international clientele in several prime locations across Cyprus and Dubai, UAE.

SIMONUS CONSULTING LTD licensed by the Cyprus Securities and Exchange Commission (CySEC), provides a full range of administrative services, inclusive of nominee services, trustee and company management services.

M. TARGET MANAGEMENT LTD was established to develop and manage local and global highpotential projects drawing on the Group’s diverse expertise and market insights.

We believe that every business, regardless of its size, should be entitled to the best professional advice available in the today’s market; that’s why we invite you to contact us for any queries, personalised proposal, or consultation.

Кипрские банки реструктурировали проблемные кредиты. Количество необслуживаемых кредитов (NPL), по сравнению с 2014 г., сократилось в шесть раз.

Центральный банк Кипра опубликовал данные о токсичных активах кипрских банков.

На конец октября 2021 г. суммарный объем проблемных кредитов составил 4,25 млрд. евро. Это в шесть раз меньше, чем в октябре 2014 г. Таких показателей удалось добиться благодаря инициативам по борьбе с NPL самих банков. В 2021 г. показатель NPL сократился до 15,3%. В 2014 г. этот показатель был на уровне - 47,8%. Тем не менее, это высокий уровень по сравнению со средним показателем по еврозоне - 3%.

Сокращение общего объема NPL на 23,7 млрд. евро за шесть лет произошло благодаря ряду соглашений по продаже проблемных кредитов специализированным компаниям (коллекторам). Покупатели NPL делают ставку на прибыль, которую они получат, когда в их распоряжение перейдет то, что обеспечивает кредит (в большинстве случаев это недвижимость). Поэтому очень часто цены, по которым банки продают токсичные активы, сильно отличаются в зависимости от обеспечения.

По оценкам экспертов, NPL, которые обеспечены недвижимостью, продаются за 25-30% от номинальной стоимости, а необеспеченные кредиты - за 1-5% от номинальной стоимости. Напомним, что существенное сокращение объема проблемных кредитов произошло в 2018 г. после поглощения Co-op Bank банком Hellenic. Также большую роль в снижении NPL сыграл факт продажи коллекторам пакета токсичных кредитов (Helix 2) кредитным учреждением Bank of Cyprus. Важно отметить, что опубликованные ЦБ Кипра данные не подтвердили опасений, что пандемия нивелирует весь прогресс последних лет по сокращению NPL.

Every year Saxo Bank prepares a forecast of underappreciated events which, if they were to occur, could send shockwaves across financial markets. Here are the bank’s predictions for 2022.

1. The plan to end fossil fuels gets a rain check. Realising the threat of inflation and social unrest, policymakers decide to temporarily relax environmental restrictions. They support fossil fuel investment and encourage producers to ensure adequate and reasonably priced supplies.

2. Facebook faceplants on youth exodus. The young generation fails to join Meta’s universe of social media platforms. The struggle of Facebook parent company Meta will lead to spinning off its components as separate entities, shattering Zuckerberg’s monopoly.

3. The U.S. mid-term election brings constitutional crisis. The U.S. Presidential elections of 2020 were quite chaotic. Saxo Bank thinks that a similar situation can be created during elections in 2022. Senate and House races come to the end and one or both sides move against certifying the vote, which makes it impossible for the new Congress to form. This eventually will lead to extreme volatility in U.S. assets.

4. U.S. inflation reaches above 15% on wage-price spiral. The Federal Reserve decides to tighten monetary policy faster in an attempt to fight inflation. As a result, there is extreme volatility in U.S. equity and credit markets.

5. EU Superfund for climate, energy, and defence announced, to be funded by private pensions. This decision is taken after policymakers realise that it will be impossible to finance the Superfund with higher taxes on incomes or other traditional tax revenues.

6. Women’s Reddit Army takes on the corporate patriarchy. A group of women traders take action by shorting stocks of selected companies with weak records on gender equality, leading to huge swings in equity prices for these companies.

7. India joins the Gulf Cooperation Council as a non-voting member. This alliance would see a reduction in India’s energy insecurity. On the other hand, India’s incredibly strong technology platform and deepening capital markets could attract the excess savings generated in the GCC region, through lower friction access.

8. Spotify disrupted due to NFT-based digital rights platform. NFTs or Non-fungible tokens are unique digital assets, the ownership of which can be established and stored on a digital ledger via blockchain tech. By leveraging NFTs, artists could distribute music directly to listeners without centralised intermediaries taking commission.

9. New hypersonic tech drives space race and new cold war. In 2022, a massive hypersonic arms race develops among major militaries. Major financing is provided for companies that build hypersonic tech with space delivery capabilities while companies in the aircraft and ship-building side of the military hardware equation underperform.

10. Medical breakthrough extends average life expectancy 25 years. Imagine that people will live to an average age of 115. What would this mean for private and government pensions, or even the ability or desire to retire?

The full forecast is available on the official website of Saxo Bank.

Metaverse
The metaverse is a network of always-on virtual environments in which many people can interact with one another and digital objects while operating virtual representations – or avatars – of themselves. This is how Facebook sees the future of virtual communication.
In October 2021, the company officially changed its name to Meta. Its focus is “to bring the metaverse to life and help people connect, find communities and grow businesses” by “moving beyond 2D screens toward immersive experiences like augmented and virtual reality to help build the next evolution in social technology”.

Gulf Cooperation Council
The Cooperation Council for the Arab States of the Gulf is a regional, intergovernmental political and economic union that was established in 1981 and consists of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE. Its major objectives – yet to be achieved – are a customs union, a common market, and a common currency.

История каждого подержанного автомобиля будет максимально прозрачной. Бизнес, построенный на реставрации и последующей перепродаже разбитых в результате аварии авто, станет не актуальным.

Глава департамента автомобильного транспорта Яннис Николаидис инициировал открытые общественные консультации с предложением о внесении изменений в “Свидетельство о регистрации транспортного средства”. В частности, Я. Николаидес предложил включить в документ полную историю повреждений, ремонтных работ и замены автозапчастей данного авто. Страховая компания будет обязана сообщать регистратору транспортных средств о любом нанесенном автомобилю ущербе. “Ранее мы уже решили вопрос контроля аукционных автомобилей, ввозимых из-за рубежа, но теперь пришло время урегулировать этот вопрос и внутри страны. Поэтому, если автомобиль попал в аварию на Кипре, страховщик будет обязан сообщить об этом властям”, - сказал Николаидис.

Страховые компании будут сообщать регистратору не только об ущербе от аварий, но и от стихийных бедствий (наводнений, пожаров, града и других инцидентов).

“Предложение было открыто для общественных консультаций, и, в большинстве, реакция была положительной. Безусловно, от принятия нового закона выиграют почти все. За исключением тех, кто извлекал выгоду из-за отсутствия прозрачности в истории транспортного средства. Не секрет, что в настоящее время некоторые автодилеры восстанавливают автомобили после серьезных аварий и продают их доверчивым покупателям. Поправки, которые скоро будут внесены в законодательство, позволят исключить возможность подобного обмана”, - добавил глава департамента.

Switzerland, Norway, UK, Germany, Sweden, and France lead the rankings as best places for private businesses and entrepreneurship to flourish in PwC’s first ever EMEA Private Business Heatmap. It ranks the attractiveness of 34 EMEA countries across categories including macroeconomics, private business landscape, tax and regulatory environment, Environmental, Social, and Governance metrics, public health, education, skills and talent, and technology infrastructure.

Cyprus ranks in the ‘advancing’ category, placing 12th, with an overall score of 54.5, while The Netherlands ranks 11th (54.8) and Luxembourg 10th (54.9). Cyprus achieved a high ranking in the Macroeconomics (5th) and Tax-Regulatory environment (4th) categories. At the same time, however, the Heatmap’s findings highlight a few categories in which Cyprus still has a long way to go. These fields have to do with ESG metrics (31st) and Technology Infrastructure (18th).

The key findings include:
● Five countries rank as the leading jurisdictions this year.
● A further 12 jurisdictions rank in the ‘advancing’ category with an EPB Heatmap overall score of at least 50 out of 100.
● 12 jurisdictions were identified as ‘developing’ with an EPB Heatmap score of between 40 and 50 out of 100.
● Five jurisdictions were identified as ‘emerging’ with an EPB Heatmap score of less than 40 out of 100.
● All four Nordic countries place within the top 10 jurisdictions based on overall EPB Heatmap rankings: Norway (2nd), Sweden (5th), Denmark (7th), and Finland (8th). Sweden ranks top within the ESG and Public Health categories. Norway co-leads the Education, Skills and Talent category.
● The UK also performs strongly, with a 3rd place ranking overall.