George Ioulianos, General Manager of Cyprus Fiduciary Association
1. What is the Cyprus Fiduciary Association and what has it achieved so far?
The Cyprus Fiduciary Association was founded in November 2011 by the initiative of a number of fiduciary providers whose aim was to further develop and organise the fiduciary services sector in Cyprus. Right from the beginning we got involved in the discussions regarding the new fiduciary Law (L.196(I)/2012 – The Law Regulating Companies Providing Administrative Services and Related Matters of 2012), taking place at the Committee on Financial & Budgetary Affairs of the House of Representatives. The new Legislation was finally voted at the end of the year, entering into force on December 21st, 2012. Our role was to represent the fiduciary firms that would eventually be under the umbrella of the Cyprus Securities & Exchange Commission (CySEC), which was appointed by Law as the new supervisory body of the sector. This role was immediately recognised by fiduciary providers, but also by public and private authorities, in general.
The founders of the Association envisioned a dynamic and constructive organisation that would be able to really contribute to the development of the sector and the Cyprus economy, in general. To that end, we have set-up a number of Committees, through which our Members can participate in the operations of the Association, contributing to public affairs and producing the policies and stances of our organisation. We have also been materialising the educational role of our Association with the organising of a number of fiduciary services-related seminars. Moreover, we have been continuously contacting and informing not only our members but also a large number of firms, on issues relating to the new developments in the sector and also assisting them regarding their licencing application to the CySEC.
2. How many members do you have at the moment?
The Association currently counts 42 member firms, many of which are some of the largest fiduciary service providers in Cyprus, with extensive international presence. They employ more than 700 staff, manage over 30,000 companies of international activities, while contributing a rough estimate of 150 million Euros to Cyprus’ GDP each year.
3. The fiduciary sector entered a new era in December 2012 when the so-called Fiduciary Law was enacted. How has this affected the sector and your operations?
Unfortunately, this important step for the fiduciary sector coincided with the Eurogroup decisions of March 2013. The Law is supposed to organise and safeguard the operations of the sector, adding credibility to Cyprus as an international business centre. The turmoil created by the decisions had an adverse result on our image and the fiduciary sector had to face the challenge of attracting new business. As an Association, we strongly believe that the sector can only survive if we all raise the standards of our professionalism, develop the right mechanisms and procedures in our firms, raising at the same time the level of our services. The new Law, although requiring certain amendments and developments, we believe it can be a useful tool towards these targets. All Administrative Services Providers (ASPs) are now going through a changing period, trying to adopt increased AML and KYC procedures, develop reporting mechanisms and amend their organisational structure. This might be increasing the ASPs operational expenses, but overall it should safeguard their operations.
4. How many fiduciary firms are currently operating in Cyprus?
We now have a better view of the number of fiduciary firms in Cyprus since everyone needs to be monitored by a supervisory body. There are 186 firms that have applied for a licence to the Cyprus Securities & Exchange Commission. Additionally, those lawyers and accountants that provide fiduciary services are exempted from the Law and are being supervised by their own professional bodies, the Cyprus Bar Association (CBA) and the Institute of Certified Public Accountants of Cyprus (ICPAC), respectively. There are 840 entities listed under the registry of the CBA and another 274 under the registry of the ICPAC.