CySEC extends Temporary Permissions Regime deadline for UK firms

The Cyprus Securities and Exchange Commission (CySEC) has extended the deadline for submission of notifications by UK firms wishing to make use of the Temporary Permission Regime (TPR).

By virtue of CySEC Directive DI87-04(2) and Policy Statement PS-02-2020, CySEC had established a Temporary Permissions Regime that does not require physical presence in Cyprus for UK firms, where they provide investment services (including investment activities) solely to professional clients and eligible counterparties based in Cyprus.

The TPR aims to facilitate a smooth post-Brexit transition to new contracts, concluded on a reverse solicitation basis, and for UK firms who wish to continue soliciting Cypriot professional clients and eligible counterparties to establish a physical presence in the Republic.

A press release regarding TPR was issued on December 22, 2020, with the deadline for submission of TPR notifications set to December 31, 2020.

Thereafter, CySEC received over 70 notifications, several of which were submitted after the December 31, 2020 deadline. The parties in question cited practical difficulties as reasons for their delay, given the short notice provided by CySEC, the operational challenges faced due to the seasonal break and their heavy Brexit-generated workload.

CySEC recognises that there are indeed justifiable reasons for the extension of the December 31, 2020 deadline and believes the extension will further facilitate a smooth post-Brexit transition.

To this end, and in view of the continuing influx of TPR notifications, CySEC has decided to extend the notification deadline for UK firms wishing to make use of the Regime until February 28, 2021 and to amend the CySEC Directive DI87-04 and Policy Statement PS-02-2020 accordingly.

CySEC also clarifies that UK firms may, in the meantime, continue providing investment services (including investment activities) to professional clients and to eligible counterparties based in Cyprus, without the establishment of physical presence, provided a TPR notification is submitted to CySEC by February 28, 2021.