UCITS

Undertakings for Collective Investment in Transferable Securities (UCITS) are investment funds that have been established in accordance with Directive 2009/65/EC (“the UCITS Directive”). Such investment funds are investment products created with the sole purpose of gathering investors’ capital, and investing that capital collectively through a portfolio of financial instruments such as stocks, bonds and other securities. Once registered in one EU country, a UCITS fund can be freely marketed across the EU.

In Cyprus, the UCITS Law 225(I) of 2002 provides the legal framework for the registration, regulation and marketing of local and foreign funds established in Cyprus. Under the UCITS Law, UCITS is considered to be any organisation whose sole aim is to collectively invest publicly collected capital, in transferable securities via stock markets, banking deposits and any other investments and whose operation is based on the principle risk of diversification and whose units can be liquidated by the unit holder on request using the assets of the organisation.

Under the legislative framework of Cyprus, the following are not considered to be UCITS under the law:

• UCITS which are not open ended
• UCITS that do not market to the public in Cyprus or other EU Member States
• UCITS that based on their fund rules or constitutional documents only make their units available to the public in other countries except Cyprus.
• UCITS for which due to their investment and borrowing policy the rules of the law 225(I) 2002 are not suitable.

Under this law, local UCITS may take the following legal forms:

• Mutual Funds
• Variable Capital Investment companies

To find out more about our legal services in the investment services sector read our Information Paper on Investment Services in Cyprus. To discuss your legal needs in any other related matter please contact us at investment@antoniou.com.cy.