Cyprus Securities and Exchange Commission

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Cyprus Securities and Exchange Commission
Επιτροπή Κεφαλαιαγοράς
CySEC Logo.jpg
Agency overview
Formed2001 (2001)
JurisdictionRepublic of Cyprus
HeadquartersNicosia, Cyprus
Employees103 (2017) [1]
Agency executive
  • Dr. George Theocharides, Chairman

The Cyprus Securities and Exchange Commission, (Greek: Επιτροπή Κεφαλαιαγοράς) better known as CySEC, is the financial regulatory agency of Cyprus. As an EU member state, CySEC's financial regulations and operations comply with the European MiFID financial harmonization law.

A significant number of overseas retail forex brokers and binary options brokers have obtained registration from CySEC.[2][3]

Nicosia financial district


CySEC was launched in 2001 as part of section 5 of the Cyprus Securities and Exchange Commission (Establishment and Responsibilities) Law of 2001 as a public corporate body. When Cyprus became a member of the European Union in 2004, CySEC simultaneously became a part of the European MiFID regulation, giving firms registered in Cyprus access to all European markets. However, joining the EU and adopting the Euro significantly changed the financial regulatory framework that CySEC policed for what had been previously considered a tax haven.[4][5][6]

On May 4, 2012, CySEC announced a policy change regarding the classification of binary options as financial instruments. The effect was that binary options platforms operating in Cyprus (where most of the platforms are based) had to be regulated.[7] This established CySEC as the first financial regulator to globally recognise and regulate binary options as financial instruments.[8]

Nicosia financial district


CySEC has the following responsibilities:[9][10]

  1. To supervise and control the operation of the Cyprus Stock Exchange and the transactions carried out in the Stock Exchange, its listed companies, brokers and brokerage firms.
  2. To supervise and control Licensed Investment Services Companies, Collective Investment funds, investment consultants and mutual fund management companies.
  3. To grant operation licences to investment firms, including investment consultants, brokerage firms and brokers.
  4. To impose administrative sanctions and disciplinary penalties to brokers, brokerage firms, investment consultants as well as to in any other legal or natural person whom fall under the provisions of the Stock Market legislation.[11]

In a recent amendment to the Law governing CySEC and its responsibility it has received significant power over the entities that it regulates in that it may carry out investigations, enter premises and search as well as to share any findings with foreign regulators[12]


CySEC is administrated by a five-member Board which is composed of the Chairman and the Vice-Chairman, that are employed full-time, plus three other members. In addition the Governor of the Central Bank of Cyprus is represented by a non-voting board member. The members of Board are named by the Council of Ministers following a proposal of the Minister of Finance and their service is a five-year term.[13][14]

Regulation & Processing[edit]

CySEC has experienced very high growth rates of registrations and pioneering legislation in regards to specific financial services.[15][16] As such, the monitoring and regulation requirements for the organization are continually under adjustment.[17] The process has been under the attention of other EU regulators and CySEC registered Brokerage houses.[18]


Throughout 2014 and 2015, CySEC has received criticism from traders and industry commentators who claimed that the organization required better legislation regarding the regulation and monitoring of high risk investment firms.[19] They suggested that fines being levied by CySEC tended to be smaller than those handed out by other EU regulatory organizations. Most of the criticism came in regards to specific binary option brokers.


CySEC was the first financial regulator aiming to regulate binary options. As such, binary option brokers, including prominent ones, are either registered (or attempting to register) with CySEC to be able to legally operate within the Eurozone or to be trusted internationally. Some of them have been requesting faster processing procedures and processes[20]

Since 2012, some unregulated brokers state on their site that “Binary Options are the simplest way to trade the market. They have been available since 2008, and have become regulated in Europe by CySEC in May 2012.” This does not imply that the broker is regulated by CySEC. Traders should probe for the 5 Digit CySEC License Number and verify on CySEC's website that the license is (still) valid.[citation needed]


CySEC has implement sweeping changes to both the registration and regulation processes of all registered entities.[21][22] Changes include more transparency regarding existing listed entities, tougher fines, Broker suspensions and license revoking.[23][24][25][26] It has also set a strict regulatory approval for name changes. In a circular in 2016, the regulator explains that "the name of the regulated entities, or the use of words within their name, should reflect the work/activities they are engaged in, for purposes of not misleading the investors".

The organization has also set up a new structure in order to improve the handling of investor complaints.[27]

CIF Certification[edit]

Firms providing investment and other ancillary services employ individuals who hold relevant qualifications. In accordance with state law, an investment firm employee involved in the provision of investment services or the carrying out of investment activities, must be registered in the public register of certified persons after passing the exams.[28] They must also fulfill the requirements of the Guidelines to Investment Firms, which specify the minimum academic and professional qualifications that they should hold. The law aims to arm Investment Firms with a good understanding of the local and European legal and regulatory framework and practices along with the essential understanding in regards to Money Laundering, Risk Management and Economics.[29]


  • Basic Financial Services Legal Framework
  • Advanced Financial Services Legal Framework

See also[edit]


  1. ^ "Annual Report 2017". CySEC. October 4, 2018. p. 18.
  2. ^ Cypriot Investment Firms
  3. ^ PricewaterhouseCoopers. "Cypriot Investment Firms ("CIFs")". Archived from the original on 14 September 2017. Retrieved 13 September 2017.
  4. ^ Smith, Yves (2013-03-23). "Repeat After Me, Cyprus Is (Was) Not a Tax Haven". naked capitalism. Retrieved 2021-09-12.
  5. ^ Gumbel, Peter. "Cyprus Rescue: The Destruction of a Tax Haven". Retrieved 13 September 2017 – via
  6. ^ "Financial Regulation in the EU" (PDF). Retrieved 13 September 2017.
  7. ^ "InvestToo: CySEC". Archived from the original on 2016-03-24. Retrieved 2016-03-18.
  8. ^ CySEC. "Announcement". CySEC. Retrieved 14 July 2019.
  9. ^ "VISION, MISSION & RESPONSIBILITIES". CySEC. Retrieved July 14, 2019.
  10. ^ "Cyprus Investment Firms (CIFS) - Finance and Banking - Cyprus". Retrieved 13 September 2017.
  11. ^ "EY: Banking Dynamics - Issue 1" (PDF). Archived from the original (PDF) on 17 October 2016. Retrieved 13 September 2017.
  12. ^ HSharpe (2019-08-01). "CySEC Powers Increased". Retrieved 2019-08-04.
  13. ^ "Cyprus Securities and Exchange Commission: Board of Directors - Bloomberg". Retrieved 13 September 2017.
  14. ^ "Perspectives from The Economist Intelligence Unit (EIU)". Perspectives from The Economist Intelligence Unit (EIU). Retrieved 2021-09-12.
  15. ^ Gold News: Credible Securities Market a Pillar for Growth
  16. ^ "PwC: Developments and Opportunities in the Cyprus Securities Market" (PDF). Retrieved 13 September 2017.
  17. ^ "Demetra Kalogerou: Credible Securities Market a Pillar for Growth". Retrieved 13 September 2017.
  18. ^ "Cyprus Securities and Exchange Commission - REGULATORY FRAMEWORK". CySEC. Retrieved 14 July 2019.
  19. ^ "Cyprus needs better legislation to monitor high risk investment firms - Cyprus Business Mail". 18 September 2015. Retrieved 13 September 2017.
  20. ^ "Cyprus needs better legislation to monitor high risk investment firms - Cyprus Business Mail". 18 September 2015. Retrieved 13 September 2017.
  21. ^ Leap Rate: CySEC to set new rules for use of Liquidity Providers and Market Makers
  22. ^ "CySEC Slaps Multiple Fines on EZ Trader, Interactive Options, UFX, FXGM Surpassing €1 mln - Finance Magnates". 27 November 2015. Retrieved 13 September 2017.
  23. ^ "CySEC suspends licence for financial services company - Cyprus Business Mail". 3 August 2016. Retrieved 13 September 2017.
  24. ^ "CySEC Fines EZ Trader Operator €340,000 - Finance Magnates". 27 November 2015. Retrieved 13 September 2017.
  25. ^ "Breaking: IronFX Settles to Pay CySEC €335,000 - Finance Magnates". 27 November 2015. Retrieved 13 September 2017.
  26. ^ Leap Rate: CySEC suspends ACFX license for one month
  27. ^ "CySEC Head: FX and Binary Options Call Centers May Be Required to Move Here - Finance Magnates". 3 May 2016. Retrieved 13 September 2017.
  28. ^ "Cyprus Securities and Exchange Commission - PUBLIC REGISTER OF CERTIFIED PERSONS". Retrieved 14 July 2019.
  29. ^ "CySEC: Q&A on CIF Exams". Retrieved 13 September 2017.

External links[edit]