The enactment of the Alternative Investment Funds Law of 2014 ("AIF Law") marked the beginning of a new era and strong opportunities for Cyprus in the fund industry.
LEGAL FORMS OF ALTERNATIVE INVESTMENT FUNDS
An alternative investment fund may be set up as a common fund, as fixed or variable capital Investment or limited partnership.
THE CATEGORIES OF AIFs
AIFs with unlimited number of persons
- May be formed in any of the legal forms mentioned above
- May be formed as fixed/variable capital company or limitedliability partnership
- May be marketed to professional and/or well-informed investors or retail investors
- May be marketed to professional and/or well-informed investors only
- Have freely transferable shares
- Subject to minimum share capital requirements of €125.000 or €300.000 if self-managed and over the asset thresholds
- No minimum share capital requirements
- Must appoint a depository
- May be exempted from appointing a depository
- Has portfolio of assets under the Alternative Investment Fund Managers Directive ("AIFMD") threshold (EUR 100mln leveraged or EUR 500mln unleveraged)
- May be self-managed or externally managed by an AIFM, a UCITS management company, or a licensed Cyprus Investment Firm
- May be self-managed or externally managed only by a UCITS management company, a licensed Cyprus Investment Firm or a company incorporated for the sole purpose of managing the AIF whose suitability is examined by the Cyprus Securities and Exchange Commission
CYPRUS AS AN ALTERNATIVE FUND JURISDICTION
Cyprus based funds and their investors can benefit from:
- An attractive tax environment
- Low set up and maintenance costs when compared to other European jurisdictions
- Modernised and adaptive legal and regulatory framework
- Respectable EU jurisdiction
THE FUTURE OF FUNDS IN CYPRUS
The transformation of the investment funds regime in Cyprus in combination with the island's regional position, attractive tax environment and professional service sector has made Cyprus an alternative jurisdiction for the setting up of funds. The new upcoming changes to the legislation and the continuous efforts of the Regulator and professionals can only result in developing this sector further.
HOW KINANIS LLC CAN ASSIST
- Assistance in structuring of schemes and licensing application
- Consulting in legal, tax and accounting matters
- Corporate and secretarial services
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.