The Cyprus Securities and Exchange Commission (CySEC) is an independent public supervisory Authority responsible for the general supervision of the securities’ market and of transactions in securities carried out in the Republic, as well as transactions carried out abroad, which are specifically provided for in the legislation.
The CySEC was established in accordance with the Securities and Exchange Commission (Establishment and Responsibilities) Law of 2001 as a public legal entity. The operation of the CySEC is governed by the Cyprus Securities and Exchange Commission Law (N73(I)/2009) of 2009-2013.
The vision of the CySEC is to establish the Cyprus securities’ market as one of the safest, most reliable and attractive destinations for investment.
The mission of the CySEC is to exercise effective supervision to ensure investor protection and the healthy development of the securities’ market.
The main duties and responsibilities of the CySEC are set out in Article 25 of the Cyprus Securities’ and Exchange Commission Law of 2009-2013 (N73(I)/2009) and may be summarised as follows:
- To examine applications and grant operating licenses to entities under its supervision, as well as to suspend and revoke the said licenses
- To supervise and regulate the operation of the Cyprus Stock Exchange and of other organized markets in the Republic and the transactions carried out in these markets
- To supervise and regulate the agencies under its supervision in order to ensure their compliance with the laws governing their operation
- To carry out all necessary investigations in view of the exercise of its duties under the law as well as on behalf of other foreign competent Authorities
- To request and collect information, which is necessary or conducive to the exercise of its duties under the law, and to demand by written request the provision of information from any natural or legal person or organisation deemed to be in a position to provide the required information
- To impose the administrative and disciplinary sanctions provided by the law
- To require the cessation of practices which are contrary to the securities market laws
- To apply to a competent court for the issue of an order for detention, or charge, or freezing, or prevention of alienation, or transaction, involving assets
- To issue regulatory Directives and Decisions
- To cooperate and exchange data and information with other public Authorities in the Republic, competent foreign supervisory Authorities and other organisations.
In addition to the above responsibilities, the CySEC has also been entrusted with powers and duties under the following laws:
- The Public Offer and Prospectus Laws of 2005-2013
- The Insider Dealing and Market Manipulation (Market Abuse) Laws of 2005-2013
- The Public Takeover Bids Laws of 2007-2009
- The Transparency Requirements (Transferable Securities Admitted to Trading on a Regulated Market) Laws of 2007-2013
Administration, Structure and Internal Organization
The CySEC is administered by a five-member Board, consisting of the Chairman and Vice-Chairman, who provide their services on a full and exclusive employment basis, and three additional non-executive members. A representative of the Governor of the Central Bank of Cyprus attends the meetings of the Board and may request the inclusion of items on the agenda, take part in the discussions and express views, but has no voting right. The members of the Board are appointed by the Council of Ministers following a proposal of the Minister of Finance and their service is a five-year term and is renewable for five more years.
The CySEC, in response to its much increased responsibilities that are the result of, inter alia, the increase of the number, size and complexity of the supervised entities, has proceeded with an internal reorganization which began in 2012 and was completed in 2013. As a result of this reorganization, the eight departments which comprise the CySEC include the Department of Strategy and International Relations, the Issuers Department, the Authorizations Department, the Supervision Department, the Department of Market Surveillance and Investigations, the Legal Department, the Administration and Personnel Department and the Information Technology and Operations Department. Also, the Internal Audit Unit was created for a more effective and efficient operation of the CySEC.
Education of the Public
Financial education is essential especially nowadays, due to the complexity and the constantly growing availability of new financial products. Modern securities markets are developing rapidly and are quite volatile, while globalization and the openness of the markets has multiplied not only the opportunities but the risks as well. Moreover, the financial needs of individuals have become more complex and therefore create a greater need for a proper management of their money.
For these reasons, the CySEC promotes financial education of the public on matters relating to the securities market in various ways. Among other things, the CySEC maintains a special section on its website dedicated to investors, which is enriched with educational material, advice and warnings issued by the CySEC and supervisory Authorities of other countries. In addition, the CySEC publishes informative articles for investors in newspapers, financial magazines and websites. The publication of “An Investor’s Guide”, which defines the basic principles of the European Directive MiFID as regards the rights of those who have invested or plan to invest in financial products, in order to receive the highest level of protection, also falls within the actions of the CySEC for the education and protection of the investing public.
The CySEC also organizes lectures and presentations, which are open to the public. In 2013, the CySEC held two such lectures in collaboration with the Cyprus Consumers’ Association on “Investments in financial products, investment risks and investor rights”. The lectures were successful both in terms of attendance and in terms of the interest by shown the public, as evident by the large number of questions addressed to the speakers. These lectures were held in the context of the Adult Consumers Academy of the Consumers Association and aimed at informing investors on the financial products available and the risks involved and also on the rights of investors when receiving investment services. The latest development in investor education initiatives is the decision by the CySEC in 2014 to go ahead with the production of a series of informational videos for the public, which will be available online at various news portals and social network websites.
For further information:
Cyprus Securities and Exchange Commission website: www.cysec.gov.cy