Client categorisation information
Following the implementation of EU Markets in Financial Instrument Directive (MiFID) with the Investment Services and Ancillary and Regulated market Law of 2007 (Law 144(I)2007) in Cyprus, all Cyprus Investment Firms are obliged to categorize its Customer as Retail Client, Professional Client or Eligible Counterparty.
The criteria used for classification of clients takes into consideration their size and level of professional knowledge and expertise in the financial market. The classification in effect enables appropriate level of protection to be awarded to clients based on their vulnerability to risks.
The Company shall inform a Client of its client categorization prior to providing a service or carrying out a transaction. Categorization of the Client is carried out taking into consideration of the Client’s information obtained by the Company from the Client. The Client may request the Company to be classified in a different category. The Company may also, in certain cases, change the Client's category.
Professional client is a client who possesses the experience, knowledge and expertise to make its own investment decisions and properly assess the risks that it incurs.
The following should all be regarded as professionals in all investment services and activities and financial instruments for the purposes of the Law:
- Entities which are required to be authorised or regulated to operate in the financial markets. The list below should be understood as including all authorised entities carrying out the characteristic activities of the entities mentioned: entities authorised by a Member State under a Directive, entities authorised or regulated by a Member State without reference to a Directive, and entities authorised or regulated by a non-Member State:
(a) Credit Institutions
(b) Investment firms
(c) Other authorised or regulated financial institutions
(d) Insurance undertakings
(e) Collective investment schemes and management companies of such schemes
(f) Pension funds and management companies of such funds
(g) Commodity and commodity derivatives dealers
(g) Other institutional investors
- Large enterprises who satisfy two of the following size criteria on a proportional basis:
- balance sheet total at least 20 000 000 euros
- net turnover at least 40 000 000 euros
- own funds at least 2 000 000 euros
- National and regional governments, public bodies that manage public debt, Central Banks, international and supranational institutions such as the World Bank, the IMF, the ECB, the EIB and other similar international organizations.
- Other institutional investors whose main activity is to invest in financial instruments, including entities dedicated to the securitization of assets or other financing transactions.
The following Clients should be treated as professionals on request under identification criteria:
Public sector bodies and private individual investors, may also be allowed to waive some of the protections afforded by the conduct of business rules of the Company.
In the course of the above assessment, as a minimum, two of the following criteria should be satisfied:
a) the client has carried out transactions, in significant size, on the relevant market at an average frequency of 10 per quarter over the previous four quarters,
b) the size of the client's financial instrument portfolio, defined as including cash deposits and financial instruments exceeds 500 000 euro
c) the client works or has worked in the financial sector for at least one year in a professional position, which requires knowledge of the transactions or services envisaged.
Professional Clients shall not be entitled to protection resulting from an Investor-compensation Fund established under the Law. In the addition to the limitation as Professional Client PMT Matrix Capital is not required to disclose information regarding fees or charges, to assess appropriateness of products or services that PMT Matrix Capital provides, to provide any risk disclosures and reports.
Professional clients are responsible for keeping the Company informed about any change, which could affect their current categorization.
‘Eligible Counterparty’ is any of the following entities to which a credit institution or an investment firm provides the services of reception and transmission of orders on behalf of clients and/or execution of such orders and/or investment management and/or dealing on own account: EU Investment Firms, other regulated Investment firms, credit institutions, insurance companies, UCITS and their management companies SICAVs, Portfolio Investment Companies, pension funds and their management companies and other financial institutions authorised by a EU Member State or regulated under Community legislation or the national law of a Member State, undertakings exempted from the application of the Investment Services and Activities and Regulated Markets Law of 2007 in accordance with paragraphs (k) and (l) of subsection (2) of section 3, national governments and their corresponding offices including public bodies that deal with public debt, central banks and supranational organisations.
Eligible counterparties will not be entitled to protection resulting from an Investor-compensation Fund established under the Law. Furthermore, the Company will not be obliged to evaluate their market knowledge and experience as such Clients are presumed to possess market knowledge and experience, whereby all services provided to such Clients shall be deemed suitable for them.
The Customer should be aware that Categorization as Eligible Counterparty provides the minimum level of protection as well as prevents from advantages of using the “best execution policy”.
Eligible counterparties are responsible for keeping the Company informed about any change, which could affect their current categorization.
These are all clients who do not fall under the Professional or Eligible Counterparty categories.
Categorization as Retail Client affords Customer the maximum level of protection under the Law including participation in the Investors Compensation Fund. Information disclosures are also more substantial including but not limited to:
- disclosure of information to Customers about the identity of PMT Matrix Capital
- disclosure of information about the key features of services provided
- PMT’s operating principles and, in particular, the means and procedures which PMT is employed in the provision of its services. Special reference shall be made to the efficiency prospects, the expense, the time and the safety of the provision of each of the services, so that the Customer might be in a position to compare the PMT performance to that of other firms in the same sector and formulate an opinion regarding the quality of the services provided by it
- disclosure of information to Customers about the key terms of the Agreement
- disclosure of information regarding the key features (including risk factors and possibility to liquidate the investment) and the specific characteristics of the investment or ancillary services that PMT Matrix Capital provides to its Customers and the class of financial instruments which constitute the object of the investment which the Customer intends to make
Request for Different Classification
A Retail Client has the right to request a different classification as a Professional Client but he/she will be afforded a lower level of protection. The CIF is not obliged to deal with the Client on this basis.
A Professional Client has the right to request a different classification as a Retail Client in order to obtain a higher level of protection. The CIF is not obliged to deal with the Client on this basis.
An Eligible Counterparty has the right to request a different classification either as a Professional Client or Retail Client in order to obtain a higher level of protection. The CIF is not obliged to deal with the Client on this basis.