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International Collective Investment Scheme
(Fund) |
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Hang Seng
Stock Exchange |
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Nasdaq Stock Exchange |
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Fig. 1
shows the organization chart. |
Under the International
Collective Investment Scheme Law of 1999, the Central Bank
of Cyprus is the appointed regulatory and supervisory
authority for such Schemes and may, upon a written
application, recognise a company incorporated under the
Cyprus Companies Law, a trust created under the
International Trust Law or a partnership registered under
the Partnership and Business Names Law, as an International
Collective Investment Scheme (namely fund).
It must be noted that the International Collective
Investment Schemes Law of 1999 will soon be amended, so that
the Central Bank of Cyprus will be the regulatory authority
only for Private Collective Investment Schemes ( i.e.
schemes with up to 100 investors).
Under the above legislation, therefore, a Scheme may take
one of the following forms:
-
International Fixed Capital
Company (IFCC)
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International Variable
Capital Company (IVCC)
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International Unit Trust
Scheme (IUTS)
-
International Investment
Limited Partnership (IILP)
All four legal types of
Schemes, can either be of limited or unlimited duration.
In view of the above, the
Central Bank of Cyprus accepts applications and recognises
only Private Schemes. Such Schemes must appoint a Custodian
which must be a Cyprus bank, unless specifically exempted by
the Central Bank of Cyprus. It must also be noted that
Private Schemes which do not have a physical presence in
Cyprus, must appoint a company to carry out the
administration work of the Scheme. The said company must be
based in Cyprus and be approved by the Central Bank of
Cyprus.
Cyprus variable
International Collective Investment Schemes (ICIS) are
regulated by the Central Bank of Cyprus and constitute
uncomplicated, flexible, private arrangements with
minimum supervision and formalities. Minimum
subscription is US$50k or equivalent and the share
capital can be varied according to the investment
capital (the fund). The fund can be resident or non
resident for tax purposes. Benefits include exemption
from taxes of sale of shares and securities, full use of
Cyprus double tax treaties, flexibility and minimal
formalities.
Example:
A Cyprus ICIS invests recognised stock exchanges
worldwide and makes a profit of
€1
million on the disposal of shares. Profits can then be
distributed as follows:
Profit
on share transactions
€1.000.000
Cyprus Taxes (capital gains etc) nil
Net
profit distributable
€1.000.000
For further
information please
contact us. |