Crowdfunding License in Cyprus
The purpose of the creation of such a company are investments in the turnover of stock market securities, deposit and currency accounts of banks and other instruments of the money environment. They can be in the form of:
1. Common Investment Funds where market instruments and depositors’ assets are freely available;
2. An investment limited liability company with capital that can be changed, it corresponds to the assets of the company.
All details on the establishment and activities of companies, including the name, Management staff, depository confirmation, legal licensing, the amount of start-up capital, restrictions on activities, shall be reviewed and approved by the Cyprus Securities and Exchange Commission.
Alternative investment funds
Another form of investment has become alternative investment funds, which are presented in forms similar to private funds:
- fixed capital companies, which cannot be changed for some time, cease to exist after receiving and distributing money to investors;
- companies with a registered capital, which varies depending on the investments purchased;
- asset owners fund of alternative companies;
- partnership, members are not allowed to manage the company and sign contracts, as this is done by the main partner.
Advantages of AIF:
- no size investments and no rules for diversification of assets;
- simplified process of creation;
- transparency of operations and financial reporting;
- control by a single Regulator;
- the possibility of transferring the fund or company from Cyprus to another country.
The tax advantages contribute to the mass formation of such investment organizations and are explained by the following criteria:
- no tax on income received and dividends received from foreign countries;
- interest paid regularly to non-residents is also exempt from taxation;
- possibility to avoid double taxation with most EU countries;
- single corporate tax rate – 12.5%;
- the increase in capital from the sale of real estate is also carried out without tax.
Investments from AIF involve investments in debt securities, real estate, and increase of private capital. The funds can have both a limited and unlimited term of validity. Created by AFI founders of different types. Professional investors have the right knowledge and experience in all decision-making, money risk assessment. Qualified investors in writing should confirm their experience and make a contribution of at least 125 thousand euros. There are also retail investors who do not meet the above investment requirements.
The experts look forward to continuing the process of improving Cyprus’s regulatory framework to expand the range of services for investment companies. FINWYN CONSULTANCY LTD lawyers will help to obtain a crowdfunding license in Cyprus for your company. Contact us and book an individual consultation today.