Cyprus makes bid for future domiciliation needs post Brexit
Cyprus is making a bid for funds business from London by offering a pathway to continued Mifid and other EU regulation-compliant business once the Brexit split between the UK and the EU is formally concluded.
The Cyprus Investment Funds Association (Cifa) has outlined its domicilation arguments, noting that the jurisdiction has already attracted some 162 fund service providers, with some €2.9bn of locally registered assets under management – a figure that has tripled since 2013. Some 218 Cyprus Investment Firms are registered under Mifid rules, with a furtherr 51 companies “currently undergoing approval”.
According to Cifa, the jurisdiction and its institutions are mulling the impact that Brexit may have, and the opportunities to assist UK fund managers in maintaining access to the single market.
Angelos Gregoriades, Cifa president, said: “Continuous efforts to upgrade our legislative and regulatory regime, supported by the strong network of financial and professional service providers, has helped shape our offering to suit the needs of investors and transform the country into the attractive investment jurisdiction that it is today.
“We believe we can become a supportive, strategic partner to the UK funds industry as it breaks away from the European Union. Our wealth of experienced service providers, the simple, yet effective, taxation system, as well as our passport to the European fund management industry, has positioned us to be a natural alternative solution for the UK.”
Earlier this year, in March, the island nation successfully exited the financial bailout programme put in place by the IMF after its banks failed. The exit came ahead of schedule, with the IMF praising the turnaround, albeit with some concerns ongoing.
IMF Cyprus mission chief Rachel van Elkan said at the time: “Cyprus has gone from the acute care stage and is now well into the recovery phase. The program equipped it with the appropriate tools; which now need to be vigorously applied to reform the economy and build resilience. In the banking sector, the ratio of non-performing loans (NPLs) remains very high at 60%, equivalent to 150% of GDP. Public debt, at just over 100% of GDP, is also a vulnerability.”