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The Markets in Financial Instruments Directive - MiFID

The Markets in Financial Instruments Directive (MiFID) is a Directive issued by the European Union (EU) which has been adopted by all member states of the EU. It was incorporated into Cyprus National Legislation via Law 144(I) 2007. From 03 January 2018, the provision of investment services and operations of investment firms in the EU is governed by reformed Markets in Financial Instruments Directive II and series of additional legislation (MiFID II). The aim of MiFID II is to make EU financial markets more resilient, transparent and investor-friendly. 

GPB-Financial Services Limited is authorized and regulated by the Cyprus Securities and Exchange Commission (CySEC) as an investment firm and is subject to MiFID II regime.

The objectives of MiFID include among other:

  • Standardizing across European jurisdictions
  • Offering investors a high level of protection
  • Ensuring high quality execution
  • Providing a coherent and risk- sensitive framework for regulating order execution
  • Enhancing transparency on liquidity

MiFID Categories

MiFID divides investors into three categories, each with different levels of protection and rights:

Professional Clients

According to MIFID a Professional Client is the one which falls in one of the following categories:

Entities which are authorized or regulated to operate in the financial markets, including those authorized by an EU member state. Such entities are:
  • Credit institutions
  • Investment firms
  • Insurance companies
  • Collective investment schemes (UCITS) and their management companies 
  • Pension funds and their management companies
  • Commodity and commodity derivatives dealers
Large undertakings meeting two of the following requirements (irrespective of an authorization to operate in the financial markets):

  • Total balance sheet: EUR 20,000,000
  • Net turnover: EUR 40,000,000
  • Own funds: EUR 2,000,000

  • National and regional governments, including public bodies that manage public debt at national or regional level (e.g. central banks, international and supranational institutions as the World Bank, the IMF, the ECB and the EIB)

    Institutional investors whose main activity is to invest in financial instruments, including entities dedicated to securitisation of assets or other financing transactions (e.g. certain family offices, corporate finance companies).

    MiFID II distinguishes between per-se professional clients as described above and opt-up or "elected" professional clients. 
    Opt-up professional clients are in principle retail clients who may be treated as professional clients on request. A number of requirements have to be satisfied in order to qualify as opt-up professional client. 

    Where you are categorized as Professional Clients

    Where we treat you as a Professional Client, some of the CySEC rules will cease to apply to us and we will be entitled to take advantage of several lighter provisions. In particular:

    • you will be given fewer information disclosures with regard to the firm, its services and any costs, commissions, fees and charges;
    • when we assess whether a product or service is appropriate for you, we can assume that you have the necessary level of knowledge and experience to understand the risks involved in it;
    • if we are ever required to assess the appropriateness of a personal recommendation made to you we can assume that you have the necessary experience and knowledge to understand the risks involved, and can sometimes assume that you are able financially to bear any investment risks consistent with your investment objectives;
    • when providing best execution, we are not required to prioritize the overall cost of the transaction as being the most important factor in achieving best execution for you;
    • we do not need to inform you of material difficulties relevant to the proper carrying out of your Order/s promptly; and
    • should we provide you with periodic statements we are not required to provide them as frequently as for retail clients.

    An Eligible Counterparty

    According to MiFID, an Eligible Counterparty is one which falls in one of the following categories:

    • Investment Firms
    • Credit Institutions
    • Insurance Companies
    • UCITS and their management companies
    • Pension funds and their management companies
    • Other financial institutions authorized or regulated under the European Union legislation or the national law of a Member State
    • Undertakings whose main business consists of dealing for own account in commodities and or commodity derivatives or undertakings which provide investment services and or perform activities consisting exclusively in dealing on own account on markets in financial futures or options or other derivatives markets, or which deal for the accounts of other member of those markets
    • National and regional governments and their corresponding offices including public bodies that deal with public debt, central banks, supranational organizations
    • Large undertakings meeting predetermined proportionate requirements, including quantitative thresholds
    • Third country entities with equivalent status

    Where you are categorized as an Eligible Counterparty

    Where we treat you as an Eligible Counterparty, you will be entitled fewer protections under CySEC rules than you would be entitled to as a professional client. In particular:

    • we are not required to provide you with best execution when executing your Orders; 
    • we are not required to disclose to you information regarding any fees or commissions that we pay or receive; 
    • we are not required to assess the appropriateness of a product or a service that we provide to you but can sometimes assume that you have the expertise to choose the most appropriate product or service for yourself;
    • we are not required to provide you with information about ourselves, our services and the agreements through which we will be remunerated;
    • we are not required to provide you with risk disclosures on the products or services that you select from us. 

    Retail Client

    According to MiFID, a Retail Client means every clients who is not a Professional Client of an Eligible Counterparty. 

    GPB FS do not offer services or carry out any business with Retail Clients. You can only establish business relations with us if you are classified as a Professional Client. 

    Upon successful completion of the due diligence and KYC "Know Your Client" procedure, you will be notified of your MiFID categorisation. You will receive our Terms of Business together with the Client Agreement. Our Terms of Business include a description of how we will conduct business with you and the following policies incorporated by reference and available in full version on the links below:

    1) Conflict of Interest Policy
    2) Risk Warnings and Disclosures Policy
    3) Order Execution and Handling Policy
    4) Client Complaints Handling Policy
    5) Privacy Policy
    6) Commissions and Charges Policy / 2022 Fee Schedule

    Among other matters, our Client Agreement includes Schedules with regard to the services to be provided to you and MiFID consent form, which you need to complete and return to us. In this way, you will be indicating your consent for the MiFID category we have categorized you.


    Dear Clients, in connection with changes in regulatory requirements introduced under MIFID II, GDPR and other applicable regulations, we are periodically reviewing our Terms of Business, Client Agreement and relevant policies with regard to conformity, efficiency and effectiveness. Documents can undergo minimal changes, thus please check the version date of the document for consistency. Thank you for understanding. For any questions, please contact us at akitros@gpbfs.com.cy or mchrysostomou@gpbfs.com.cy

    Risk Disclosures

    Corporate Governance Disclosures

    Public disclosure of Return on Assets (ROA)

    According to the provisions of Article 19 of Consolidated Directive DI144-2014-14 and 14(A) of CySEC, CIFs must disclose their return on assets, calculated as their net profit divided by their total balance sheet. The Companys Return on Assets, as at 31 December 2020, is 0.28%.

    Top 5 Execution Venues / Brokers

    Systematic Internaliser

    Systematic Internalisers (SI) are defined as investment firms which, on an organised, frequent, systematic and substantial basis, deal on own account when executing client orders outside a regulated market, an MTF or an OTF.

    GPB-Financial Services Ltd (GPBFS) is an SI for the purposes of Directive 2014/65/EU (MIFID II)) for the financial instruments as included in Appendix 1 below.

    Provision of quotes
    Details in relation to the provision of quotes to clients of GPBFS are provided in our Systematic Internaliser Commercial Policy, which can be found below.

    Systematic Internaliser Commercial Policy

    Appendix 1:
    List of financial instruments for SI as of NOV 2018
    List of financial instruments for SI as of FEB 2019
    List of financial instruments for SI as of MAY 2019
    List of financial instruments for SI as of AUG 2019
    List of financial instruments for SI as of NOV 2019
    List of financial instruments for SI as of February 2020
    List of financial instruments for SI as of May 2020
    Systematic Internaliser Information as of August 2020
    Systematic Internaliser information as of November 2020
    Systemic Internaliser Information as of May 2021
    Systemic Internaliser information as of August 2021
    Systematic Internaliser informationas of November 2021
    Systematic Internaliser Informations as of February 2022
    Systemic Internaliser Informations as of May 2022
    Systematic Internaliser information as of August 2022

    If you require additional information about MiFID, please contact our Compliance Department at: +357 25 055 119 or akitros@gpbfs.com.cy or mchrysostomou@gpbfs.com.cy

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