The Cyprus Securities and Exchange Commission (CySEC) is an independent public supervisory authority with a crucial role in regulating, supervising, and developing the financial markets in the Republic of Cyprus. Established in 2001 pursuant to Section 5 of the Securities and Exchange Commission (Establishment and Responsibilities) Law as a public legal entity with the explicit objective to ensure transparency, protect investors, and provide healthy capital market functionality.
CySEC has become an increasingly fundamental part of the financial ecosystem in Cyprus, serving as a key regulatory authority for various economic entities, including investment firms, asset managers, fund operators, and brokers. Additionally, due to Cyprus's geographical location, CySEC has also become a pivot point for international investors to reach European, Asian, and Middle Eastern markets.
Mission and Vision
CySEC has a straightforward mission:
"To exercise effective supervision to protect investors and foster the dissemination of information for the healthy development of the securities market".
CySEC aims to ensure transparency, reliability, and security in all investment environments, thereby fostering trust among investors and other market participants. The long-term vision is to create a safer, more competitive, and more attractive investment environment for Cyprus, positioning it as one of the safest investment locations in Europe.
To achieve the objectives of its regulatory purpose, CySEC regularly updates its regulatory framework to align with international standards and best practices, and continues to adapt to the fast-paced dynamics of the financial industry.
Core Values
CySEC is rooted in a set of core values that inform its directions relating to governance and regulation:
• Effectiveness – Utilising compelling, coherent, and timely supervision across all financial services
• Integrity and Trustworthiness – Committing to the highest principles of honesty and professionalism
• Transparency – Being clear in the laws, policies, practices, and communications of the organization
• Equity and Fairness – Making decisions that are fair, objective, and impartial
• Cooperation and Teamwork – Supporting practical cooperation with national and international stakeholders
• Open Communication – Engaging with market participants and the general public to foster trust and avoid creating unnecessary impositions.
Each of those values represents CySEC's commitment to being both an investor protector and a driver to sustain growth in Cyprus's financial services markets.
Roles and Responsibilities
CySEC's roles and responsibilities are clearly outlined in the Law on the Structure, Responsibilities, Powers, and Organization of the Cyprus Securities and Exchange Commission (Law 73 (I)/2009).CySEC has a wide-ranging mandate for regulatory and supervisory functions, including the following:
• Licensing and other licensing activities, such as review applications, issuing licenses, and the suspension or revocation of licenses
• Supervising regulated markets such as the Cyprus Stock Exchange and other organized markets
• Compliance monitoring - monitoring whether the entity is complying with national and EU legislation regulating its activities
• Investigations - conducting inquiries to investigate any suspected breaches or violations and liaising with foreign regulators where appropriate
• Information Requests - collecting the necessary information to enable the Commission to exercise its functions from any person, company, or organization
• Imposition of sanctions - administrative fines or disciplinary action for violations
• cease Unlawful Activities - directing ends to trades or activities that contravene securities regulations
• Judicial Applications - to freeze or detain assets or limit activities with judgments, if needed
• Issuing Directives and Decisions - addresses specific standards for regulation to provide consistency for regulated entities and transparency for the marketplace
• International Cooperation- information sharing and engaged closely with European and International supervisory authorities
With these functions, CySEC facilitates the activities of financial services institutions, enabling Cyprus to maintain a robust, transparent, and compliant financial system in accordance with national laws and EU regulations, as well as international standards.
Entities Under Supervision
CySEC's regulatory responsibilities are wide-ranging and include a few examples of the different types of entities regulated in the finance and investment industry, which include the following:
• Cyprus Investment Firms (CIFs)
• Branches of EU-based Investment Firms established in Cyprus
• Tied Agents of CIFs
• Undertakings for Collective Investment in Transferable Securities (UCITS) and their management companies
• UCITS Agents, and Cyprus branches of other EU member states UCITS management companies
• Administrative Service Providers, including trustees and fiduciary service providers
• Variable Capital Investment Companies
• Alternative Investment Fund Managers (AIFMs)
• Regulated Markets and Central Counterparty Clearing Houses (CCPs) for over-the-counter (OTC) derivatives
• Trade repositories for OTC derivatives
• Crypto-Asset Services Providers
As the structure and regulations evolve, CySEC is enhancing its supervision and regulation of new sectors, including digital assets and cryptocurrencies. New rules are being implemented to ensure that firms offering crypto services adhere to regulations, including compliance with AML, customer protection, and transparency, among others.
International Cooperation
In today's global world, CySEC recognizes the importance of liaising with international regulators and supervisors. Cooperation with other authorities across the European Union and beyond enables CySEC to monitor cross-border dealings and activities, and collaborate to address issues of financial crimes and a consistent regulatory process.
This adds credibility to Cyprus's reputation as a trusted financial centre and enables the Commission to be aware of and respond to other jurisdictions when world standards are introduced or challenged, thereby addressing new market challenges.
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