On December 20, the Cyprus Securities and  Exchange  Commission ( CySEC  ), a major regulatory body in Cyprus, posted the annual income generated by investment companies in the country over the previous year. According to the newly released annual statistical bulletin for 2020, the total number of authorized entities reduced by 1% between 2019 and 2020 (from 494 in 2019 to 490 in 2020). Such a decrease originated from the number of Cyprus administrative service providers (from 153 in 2019 to 146 in 2020). During 2020, the authorized regulated entities (460 firms), where the data was collected, totaled around 94% of the total of authorized firms.

Furthermore, during 2020, the income generated from the activities of Cyprus Investment firms (CIFs) amounted to €1.9 billion, while Net income amounted to €0.3 billion. That year witnessed the largest amount of trading and net income. The Trading Income and the Net Income saw 65% and 51% year-on-year increase between 2019 and 2020, respectively. Between 2018 and 2019, the total number CIFs customers witnessed a significant decrease of around 33%. However, between 2019 and 2020, the number of clients of such companies saw a significant increase of around 34%. Overall, there were 1,587,300 total clients for all CIFs at the end of 2020.

cifs clients 2017-2020

Source: CYSECAnnual Statistical Bulletin 01/01/20 to31/12/20

Likewise, the total number of employees working in all CIFs have seen an increase over the years. For instance, the total number of employees reached 5,408 by the end of 2020, which is a 10% year-on-year increase from 2019.

Related to the aforementioned, the total number of CIFs saw a 2% decrease between 2018 and 2019. However, the total number of such entities noticed a 1% increase between the same time period. For example, there was a total of 228 CIFs at the end of 2020. In contrast, CySEC regulated and supervised a total of 788 entities by the end of 2020.

The Place for Investment Firms and Investors

The development from CySEC comes at a time when Cyprus is becoming a major hub for investment firms such as forex companies. The jurisdiction has become popular because of the possibility of conducting business operations across the region through its ideal location, relatively easy establishment conditions and the availability of a regulatory agency along with low taxes.

CySEC regulates all investment companies in Cyprus. There are a significant number of companies operating various types of financial activities in the country and complying with CySEC regulations. In March, the regulator issued a warning against five financial-related platforms that had no authority to operate in the country. The watchdog singled out edufintech.org, vestlefx.com, powerfxm.com, traderscodes.com and ti-gi.com as websites that did not have licenses to operate in the country.

The Cypriot financial authority stated that such websites did not fall under the category of firms that were authorized to provide ‘investment services’ and/or the ‘performance of investment activities’ as highlighted in the law. The agency urged investors to consult its website (www.cysec.gov.cy), before carrying out business with investment firms. This would enable investors to ascertain which entities are licensed to offer investment services and/or investment activities to consumers.

On December 20, the Cyprus Securities and  Exchange  Commission ( CySEC  ), a major regulatory body in Cyprus, posted the annual income generated by investment companies in the country over the previous year. According to the newly released annual statistical bulletin for 2020, the total number of authorized entities reduced by 1% between 2019 and 2020 (from 494 in 2019 to 490 in 2020). Such a decrease originated from the number of Cyprus administrative service providers (from 153 in 2019 to 146 in 2020). During 2020, the authorized regulated entities (460 firms), where the data was collected, totaled around 94% of the total of authorized firms.

Furthermore, during 2020, the income generated from the activities of Cyprus Investment firms (CIFs) amounted to €1.9 billion, while Net income amounted to €0.3 billion. That year witnessed the largest amount of trading and net income. The Trading Income and the Net Income saw 65% and 51% year-on-year increase between 2019 and 2020, respectively. Between 2018 and 2019, the total number CIFs customers witnessed a significant decrease of around 33%. However, between 2019 and 2020, the number of clients of such companies saw a significant increase of around 34%. Overall, there were 1,587,300 total clients for all CIFs at the end of 2020.

cifs clients 2017-2020

Source: CYSECAnnual Statistical Bulletin 01/01/20 to31/12/20

Likewise, the total number of employees working in all CIFs have seen an increase over the years. For instance, the total number of employees reached 5,408 by the end of 2020, which is a 10% year-on-year increase from 2019.

Related to the aforementioned, the total number of CIFs saw a 2% decrease between 2018 and 2019. However, the total number of such entities noticed a 1% increase between the same time period. For example, there was a total of 228 CIFs at the end of 2020. In contrast, CySEC regulated and supervised a total of 788 entities by the end of 2020.

The Place for Investment Firms and Investors

The development from CySEC comes at a time when Cyprus is becoming a major hub for investment firms such as forex companies. The jurisdiction has become popular because of the possibility of conducting business operations across the region through its ideal location, relatively easy establishment conditions and the availability of a regulatory agency along with low taxes.

CySEC regulates all investment companies in Cyprus. There are a significant number of companies operating various types of financial activities in the country and complying with CySEC regulations. In March, the regulator issued a warning against five financial-related platforms that had no authority to operate in the country. The watchdog singled out edufintech.org, vestlefx.com, powerfxm.com, traderscodes.com and ti-gi.com as websites that did not have licenses to operate in the country.

The Cypriot financial authority stated that such websites did not fall under the category of firms that were authorized to provide ‘investment services’ and/or the ‘performance of investment activities’ as highlighted in the law. The agency urged investors to consult its website (www.cysec.gov.cy), before carrying out business with investment firms. This would enable investors to ascertain which entities are licensed to offer investment services and/or investment activities to consumers.