Cyprus Alternative Investment Funds

Characteristics of Cyprus Alternative Investment Funds (AIFs)

• A vehicle for collective investments
• Gives the opportunity to raise external capital from a number of investors
• Invests according to a defined investment policy for the benefit of investors
• Established and managed by an investment manager

Cyprus is fast becoming one of the top emerging investment fund centers in Europe

• Modernised legislation, fully harmonized with related EU Directives
• EU and Eurozone member states compliant with EU laws and regulations, with access to all EU markets
for licensed funds and managers through EU passporting
• Mature business center with highly qualified professional and sophisticated infrastructure
• Cost-effective setting-up and ongoing operational services; the most competitive in Europe
• Transparent (EU and OECD-approved) tax regime with access to an extensive network of double tax
treaties allowing for tax-efficient structuring of investments
• Collective investments can be listed on the Cyprus Stock Exchange and other recognized EU stock
exchanges
• Cyprus-based funds and asset managers benefit from low tax burdens levied on Cyprus-based
operations
• Incentives and tax benefits for high-earning managers and high-net-worth individuals

Advantages of a Cyprus AIF:

• Modern regulatory framework in line with relevant EU Directives
• No restrictions regarding the type of investments
• The application process is fairly simple and not time-consuming
• AIFs can be set up as umbrella funds with multiple investment compartments, allowing the management of
different asset pools with separate investment policies
• AIFs with an unlimited number of investors can be listed on the Cyprus stock exchange and other EU recognized stock exchanges
• Low setup and maintenance costs
• No onerous ongoing reporting requirements to the Regulator

Tax incentives:

• AIF in the form of a company can take advantage of the wide double tax treaty network of Cyprus
• No withholding tax on dividend distributions for foreign investors
• The services provided by the Investment Fund Manager are not subject to VAT
• 12.5% corporate tax rate, is among the lower in the EU
• No stamp duty on the issue of units in AIFs
• Exemption from the tax on profits from the redemption of units

Our Services:

Fund Licensing: Preparation, submission and follow up of a fund licensing application to the Regulator
Fund Hosting: Ongoing management of the fund as a host under a licensed Management Company
Fund Administration: Ongoing administration of the fund including accounting, net asset valuations, middle office, transfer agent
Regulatory Compliance: Ongoing reporting, advice, and assistance in all regulatory obligations and returns of the fund
Fiduciary services: Company incorporation for the structure, provision of a trustee, secretary, directors, registered address, and real offices
Legal Services: Provision of full legal services including deal-flow management and execution and regulation related advise
Tax services: Provision of Direct tax and Indirect tax compliance and advisory services

_{Disclaimer: This publication has been prepared for general guidance on matters of interest only and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, Highworth (Cyprus) Ltd, its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the
information contained in this publication or for any decision based on it.
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