The Cyprus Securities and Exchange Commission (CySEC) issued a new announcement to highlight the implementation of upcoming MiFID II and MiFIR regulatory frameworks. All companies that are regulated in the country should take appropriate action to adjust their offerings in line with a vast new set of requirements that are coming into force EU-wide on the 3rd of January 2018.
MiFID II provisions are set to be incorporated into Cypriot national law by the 3rd of July 2017. MiFIR will be directly applicable starting from the first working day of 2018.
CySEC is highlighting several aspects of the new European regulatory frameworks that will affect a number of companies on the island. Authorization requirements for Cyprus Investment Firms (CIFs) will change starting from next year.
Key Changes Highlighted by CySEC
There are a number of companies that are going to be affected by the changes introduced under MiFID. Those include CIFs that will need to extend their authorization in order to comply with new investment activities and/or cover new financial instruments that are available for trading.
Firms that have been previously exempted from MiFID and persons engaged in high-frequency trading will also fall within the scope of the regulation. Some businesses and entities that are unauthorized will need to become regulated under MiFID II.
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CySEC has outlined in detail a number of publications by the European Commission that should provide additional clarity to compliance departments. The Cypriot regulator has also published a special email address for firms that are requiring additional clarifications related to the authorization process: email@example.com.
The document which we are providing below is not exhaustive and compliance departments of Cyprus-regulated companies will need to carefully assess their particular status. Among many updates, CySEC is highlighting changes to Organized Trading Facilities (OTFs), companies that are providing investment advice, underwriting and/or placing.
Big changes to outsourcing rules, record keeping, safeguarding of client assets and safeguarding of client assets are also a notable change under MiFID II.