The Cyprus regulator is going to allow UK financial services firms, which are operating under the Temporary Permissions Regime (TPR) to conduct business in Cyprus after the deadline of 31 December 2021.
CySEC highlighted that this affects only companies seeking to establish physical presence in Cyprus or another country in the European Economic Area (EEA) and are applying for regulatory licence or gaining one through acquisition.
The regulator noted that in order to allow for a smooth transition for UK companies to establish their business operations in Cyprus, these companies will be allowed to conduct business under TPR until their applications are reviewed. Upon approval of their applications, they will be given additional six months to onboard clients and fully establish their operations.
CySEC introduced the TPR in December 2020, following Brexit, so that UK companies can continue to offer their services to clients based in Cyprus.
The regulator noted that it has received 96 applications to join TPR, of those 88 firms met the requirements.
CySEC stated:
Amongst the groups of the TPR Entities (the ‘TPR Groups’), several sought to continue their solicited activities in Cyprus, and in this context, relevant applications have been submitted to CySEC.
It should be noted that the applications received by CySEC are reviewed in order of priority, creating a series of challenges as it comes to the evaluation’s completion in a timely manner. Considering that reviewing applications that entail the establishment of a physical presence within the Republic is a cumbersome procedure, CySEC has decided to proceed with amending Directive 87-04, allowing companies operating under TPR to continue to operate under this regime, until the relevant application is reviewed.
The Cyprus regulator will publish a list of the entities which will be allowed to operate after the deadline on 1 January 2022.
