During the past few years, the funds industry in Cyprus has experienced significant growth (both in terms of value of assets and in terms of number of funds and fund managers), resulting in the Island establishing itself as one of the major EU fund jurisdictions.
Its strategic geographic position, stable political system, attractive tax system, modernised AIF Law, combined with EU and Eurozone memberships, have served to attract global funds and fund managers alike.
The recent regulatory changes in the Cyprus funds industry have resulted in the full alignment of local legislation with the relevant EU Directives, including the Alternative Investment Funds Manager Directive.
Overall, Cyprus is the most flexible and cost-efficient fund jurisdiction in the EU, a member of the European Securities and Markets Authority (ESMA), and additionally boasts a comprehensive funds and related services workforce comprising of some 4,000 qualified lawyers and 5,000 qualified accountants, establishing Cyprus as a prominent player within the EU funds industry.
The attractiveness of Cyprus as a jurisdiction of choice for AIF and fund managers alike, is displayed in the significant growth which the industry has experienced in the past few years.
As of December 2018, the Cyprus funds industry boasted a total of approximately EUR 6.3 bln assets under management displaying significant growth over the past few years. Approximately 63% of these relate to AIFs investing in securities and 16% to real estate AIFs with the remaining 21% spread evenly in other type of AIFs.
In terms of number of AIFs, there are currently 137 authorised AIFs with approximately another 50 under examination and 24 authorised fund management entities, with approximately another 10 under examination.
The latest "seal of approval" of the Cyprus funds industry came after Clearstream added Cyprus as an "approved jurisdiction" allowing Cyprus funds to be distributed via Clearstream's Vestima platform.
We at Savva & Associates are among the few providers in Cyprus experienced in the establishment and administration of alternative investment funds and the most cost efficient in delivering high level alternative investment fund services in Cyprus. Our dedicated Investment Funds Division has extensive knowledge of financial services, coupled with local legal and tax expertise, ensuring efficiency in establishment, licensing and ongoing management of AIFs.
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.