The Council of Ministers, with a new decision dated 21.5.2018 made several amendments to the cypriot investment scheme, including subjecting every CIP application to enhanced due diligence checks and limiting granting of citizenship to only 700 per year.
The time frame for examining the applications is set to six months to complete the due diligence process. The due diligence is to be borne by applicants.
The council setup new registry of licensed agents, as of Aug 2018 only licensed agents can submit applications to the Government. The list of licensed service providers to be published by the end of July.
Enhanced Due Diligence
The Code of Conduct rules of Licensed Members of the Registry shall apply the following due diligence practices in relation to client acceptance, when examining the possibility of collaboration:
1. Recording and verifying information that fully and accurately identifies the potential client.
2. Undertaking, within the framework of the law, checks on the client, of its professional activities as well as its surroundings (including possible publications in the press or online).
3. Verifying the origin and legality of the investment funds of the client.
4. Providing a report of the findings of the due diligence review (due diligence report) from internationally recognised electronic databases, for the use of which a fee is payable (e.g. World Check, LexisNexis Diligence, Regulatory DataCorp Inc, etc). The report must be dated no later than thirty days from the date of its submission. Members must ensure that they take all required steps to secure the safety of their clients’ funds, as follows:
5. Maintaining client investment funds in separate bank accounts.
6. Reporting to clients as to the movement of their funds.
7. Reporting to clients on all expenses made and issuing relevant invoices with all necessary information, as provided by applicable law.
8. Returning to clients any possible excess of funds including interest, upon completion of the collaboration. Members apply clear and distinct procedures to manage all clients’ information with due confidentiality and ensure that the information is made available only in cases where the members are obliged to disclose information through court or other legal proceedings, notifying their clients in advance.
