The legislation does not apply on CIF and credit institutions who exercise administrative services in the framework of their business which are regulated by their respective competent authorities and management companies and variable capital investment companies who provide administrative services during the course of their business under the Open Ended Undertakings in Collective Investments Law, and only the persons who are eligible will be able to provide management services.
The application of the legislation will cover, in general, the following services and activities:
- Trustee services; and
- Provision of services, such as nominee services, and opening of bank accounts, to private and public companies, partnerships or other organisations whether legal or physical persons, wherever they have been incorporated or established.
The legislation will not apply to physical persons providing services as:
- A consultant in a company in which its securities are listed on a regulated market, which is under a supervisory authority and is obliged to have non-executive independent consultants, in governmental or semi-governmental majority owned by the Republic of Cyprus;
- A consultant or secretary in a company in which he/she owns physically or through company at least 25% by his/her spouse and/or members of his/her family up to fourth degree of relation or in a trust in which relatives up to fourth degree are beneficiaries;
- A consultant or secretary in the company which is his exclusive employer or company belonging to a group that the employer is a member;
- A consultant or secretary of a subsidiary company as described on the above three paragraphs;
- A trustee where the person is a settlor or where all the beneficiaries are himself or relatives up to fourth degree of relation;
- A trustee in a trust created in the will of a physical person; and
- A consultant providing services for fewer than 10 companies, not including companies mentioned in the first three paragraphs and provided that the person is not controlling the Board of Directors of a company.
Persons, whether legal or physical, providing fiduciary services in Cyprus, other than the services provided above, shall be obliged to apply to be licensed by the relevant authority which is subject to conditions.
An application is completed and forwarded to the Cyprus Securities & Exchange Commission, which can be found on its website.
In cases an application is rejected by the Commission, then the said person shall cease to provide such services within six months from the notification date of the rejection.
The Commission shall respond to each application of newly established service providers within four months.
The Commission shall respond to already existing service providers within 24 months.
A license can be suspended or revoked by the Commission, while there are cases where the license is automatically terminated.
Licensed persons are held in a register, which can be freely accessible by the public.
Persons, who do not comply with the provisions of the legislation can face criminal and civil liability, administrative sanctions and regulatory competency of the Securities and Exchange Commission.
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