Ca Fiducia has a great deal of expertise in both advising on and formation of Fund structures. We may also assist with the management and operation of the Cyprus Fund after its establishment.
International Collective Investment Schemes (ICIS)
The International Collective Investment Schemes Law was introduced in Cyprus in May 2009, a legal framework that governs the registration, regulation of operations and supervision of International Collective Investment Schemes (ICIS). ICIS are regulated by the Central Bank of Cyprus, and approval for setting up an ICIS is given after a written application by the interested party (which can be a company incorporated under the Cyprus Companies Law, a trust created under the International Trust Law or a partnership registered under the Partnership and Business Names Law). The Cyprus Securities and Exchange Commission (CySec) is currently preparing in becoming the regulatory body of ICIS and shall soon take over the authorities of the Central Bank in this respect.
The ICIS can take one of the following forms: International Fixed Capital Company (IFCC), International Variable Capital Company (IVCC), International Unit Trust Scheme (IUTS), International Investment Limited Partnership (IILP), All four types of ICISs can be either of limited or unlimited duration. An ICIS once recognized, may be designated as: An ICIS to be marketed to the general public; or an ICIS to be marketed solely to experienced investors; or a private ICIS. The Scheme will act as an investment fund and its purpose will be the collective investment of the investors’/unit holders’ funds.
The Undertakings for Collective Investment in Transferable Securities Directives 2001/107/EC and 2001/108/EC (or “UCITS”) are a set of European Union Directives that aim to allow collective investment schemes to operate freely throughout the EU on the basis of a single authorisation from one member state. In practice many EU member nations have imposed additional regulatory requirements that have impeded free operation with the effect of protecting local asset managers. As a result of this, the Cyprus House of Representatives enacted the UCITS Law 59(I)/2008, as amended (hereafter the “Law”), so as to comply with the EU Directives. According to the Law in order to establish and operate an Undertaking for Collective Investments in Transferrable Securities (“UCITS”), a license shall be granted by the CySEC. The Company can be classified as either a Common Fund Company or a Variable Capital Investment Company, according to the nature of its operations. Depending on whether the Company will be formed as a Common Fund or a Variable Capital Investment Company the legal framework provides for the respective requirements. There is currently a draft legislation and Directive from CySEC, which is under discussion, in order to be in conformity with the EU Directive 2009/65/EU. The directive will significantly update the existing EU directive by modernizing the regulatory framework.
