Certain provisions of the Investment Services and Activities and Regulated Markets Law of 2007 (“the Investment Services Law”) and Directive DI144-2014-14 for the Prudential Supervision of Investment Firms issued by the Cyprus Securities and Exchange Commission (“CySEC”) apply only to Cyprus Investment Firms which are categorized as “significant” on grounds of size, internal organization and the nature, scale and complexity of their activities. These include limits on the number of directorships an individual may hold and the requirement to establish board committees such as a nomination committee, an independent risk committee or an independent remuneration committee.
CySEC has revised its threshold criteria for determining which firms are deemed to be significant and has set them out in a new circular (C228 dated 26 July 2017). A Cyprus Investment Firm is deemed to be significant if, according to its audited financial statements, it satisfies at least one of the following criteria:
| Total assets | Above EUR 43 million |
| Annual fees, commission income or net trading income | Above EUR 50 million |
| Clients’ money | Above EUR 35 million |
| Clients’ assets | Above EUR 750 million |
CIFs have four months from the end of each financial year to assess whether they exceed any of the thresholds. If so, they must immediately inform CySEC and make arrangements to comply with the more rigorous governance requirements that apply to significant CIFs. CySEC has discretion to waive the more rigorous requirements on proportionality grounds on written application by the CIF. Conversely CySEC may require a CIF which does not meet any of the criteria to comply with the more rigorous requirements.