Cyprus Securities and Exchange Commission (CySEC) broke its six-month consultation silence during the Christmas period, by proposing new rules that would significantly expand the acceptance of English-language prospectuses.
How will this change affect the operational efficiency and international competitiveness of Cyprus-based investment firms (CIFs), particularly in the FX/CFD sector where English is predominantly used in client communications?
CySEC Moves to Accept English Language Prospectuses in Broader Range of Cases
Despite the holiday lull in markets and the industry, the Cypriot regulator has been active, using the brief window between Christmas and the New Year’s break to release a new consultation paper. This marks the first in six months and only the second this year where the regulator has sought input from industry representatives regarding proposed changes.
These changes, though seemingly technical at first glance, could hold significant implications—and potential benefits—for the predominantly English-speaking financial sector.
The proposed changes, outlined on December 27, would allow companies to submit prospectuses in English across a broader range of cases while maintaining investor protection through mandatory Greek language summaries. This marks a departure from the current policy where Greek is the default language, with English accepted only in limited circumstances.
Δελτίο Τύπου – Η ΕΚΚ αυξάνει τις περιπτώσεις σύνταξης ενημερωτικού δελτίου στην αγγλική γλώσσαhttps://t.co/Dl93EjVU6B
— CySEC - Cyprus Securities and Exchange Commission (@CySEC_official) December 27, 2024
Press Release – CySEC broadens the cases where drawing up a prospectus in English is acceptedhttps://t.co/jjg2ERE34T
“CySEC’s proposal to amend its approach on the accepted languages for a Prospectus, whilst requiring that the summary thereof, which contains the essential information to take an investment decision, is also made available in Greek, aims at ensuring investor protection in a proportionate manner,” the regulator commented in an official press release issued last week.
Until now, the approach has been the opposite: Greek served as the primary language, with only key documents or summaries of decisions published in English. Detailed information, however, was available exclusively in the state’s official language.
The proposed changes could particularly impact Cyprus Investment Firms (CIFs), including the substantial number of FX and CFD brokers operating under CySEC supervision. The new language requirements might streamline their documentation processes, especially for those serving an international client base.
Market participants have until January 20, 2025, to submit their feedback to CySEC's policy department.
Crack Down on Weapons Financing, New Website and Crypto Rules
CySEC has been active in recent weeks, introducing several initiatives aimed at enhancing regulatory compliance and operational transparency. One key development is the release of detailed guidance requiring brokers, cryptocurrency platforms, and financial firms to implement stringent measures against weapons proliferation financing (PF).
The framework mandates regulated entities, including FX/CFD brokers and crypto platforms, to establish robust screening systems and conduct enhanced due diligence to prevent the use of trading operations for financing weapons of mass destruction.
In a parallel effort, CySEC launched a new website designed to improve the experience for regulated firms, investors, and the general public. According to the regulator, the updated platform represents a significant advancement in accessibility, transparency, and user convenience.
Earlier, in November, CySEC began accepting applications for Crypto Asset Service Provider (CASP) licenses from entities and individuals seeking preliminary assessment under the upcoming Markets in Crypto-Assets Regulation (MiCA). This initiative aligns with the regulator’s preparation for MiCA’s full implementation across the European Economic Area, which took effect on December 30, 2024.
