The Cyprus Securities and Exchange Commission (CYC) is launching a thematic review on the handling of uninvested funds held by Cypriot investment companies (CIFs) on behalf of their (potential) clients, including the payment of interest or returns on such uninvested funds.
The aim of the initiative is to evaluate the procedures followed by CIFs in the aforementioned activity to ensure compliance with the relevant regulatory requirements.
The Exercise will cover, among others:
- The methods and arrangements used by CIFs in this activity.
- Information provided to customers, including the terms of the agreement signed between the parties.
- The controls applied by CIFs to ensure compliance with all relevant regulatory requirements, including those relating to marketing communications. These include the requirements defined in articles 5 paragraph 5, 17 paragraph 2, 17 paragraph 4, 17 paragraph 9, 25 paragraph 1 and 25 paragraph 3 of Law 87(I)/2017, as well as articles 21, 44, 46( 5) and 49 of delegated regulation 565 of MiFID II.
CYC believes that this initiative will not only ensure compliance with Law 87(I)/2017 but also enhance the protection of investors’ interests, in line with CYC’s objectives.
The review will be conducted through a desk-based assessment method on a sample of CIFs. In the coming days, CySEC intends to send a relevant questionnaire to selected CIFs. These companies will have to fill in and return the questionnaire to ΕΝΚΕΝ within a specified time frame, accompanied by supporting documents.