A Cyprus alternative investment fund gives a promoter an EU-passported vehicle at a fraction of Luxembourg or Dublin running costs, and our team handles the structuring, the filing and the administration that follows. The question almost every enquiry turns on is which of three vehicles fits, because picking the wrong one costs months and cannot be corrected cheaply.
Working out which structure suits your strategy? A short call establishes the right vehicle, the manager arrangement, and what the whole thing will realistically cost to run.
Discuss your structureThe Three Vehicle Types
Unlimited Number of Persons
Authorised by CySEC, open to retail as well as well-informed and professional investors, with no cap on investor numbers. Minimum share capital of €125,000 applies where the vehicle is internally managed. May be listed. Investment restrictions vary with the investor base.
Limited Number of Persons
Capped at 50 natural persons, addressed only to well-informed or professional investors, and subject to a lighter authorisation route. Suits club deals and family capital.
Registered Alternative Investment Fund (RAIF)
Registered with the regulator rather than authorised by it, which is the fastest route to market. Must be externally managed by an authorised manager and restricted to professional and well-informed investors, never retail. No authorisation at vehicle level means no minimum capital there either.
Most promoters who come to us expecting to need full authorisation discover the RAIF route serves them better.
Choosing a Legal Form
Umbrella structures with segregated compartments are permitted across all forms, and each compartment is treated separately for tax purposes. That single feature does more work for multi-strategy promoters than anything else in the framework.
Manager Requirements
Full-Scope Managers
Authorisation under the managers legislation, with initial capital of €125,000 for an external manager or €300,000 where the vehicle manages itself. Substance, governance, risk management, remuneration, depositary, valuation and reporting obligations all apply.
Sub-Threshold Managers
Available where aggregate AUM stays under €100 million, or under €500 million for closed-ended unleveraged vehicles whose redemption rights are locked for at least five years. Lighter registration, but no EU marketing passport unless the manager opts into full authorisation.
Mini Managers
A separate lighter category exists under 2020 legislation for smaller portfolios.
Promoters without their own manager can appoint a third-party host, which is how most first-time launches happen. You do not need to build a management company to launch a fund.
What AIFMD II Changed
The second directive brought loan origination rules, mandatory liquidity management tools for open-ended vehicles, and tighter delegation and substance expectations. Its transposition deadline of 16 April 2026 has passed, and the regulator issued transitional guidance in December 2025 setting out its expectations in the interim.
Practical consequences worth planning around
- Loan-originating vehicles should in principle be closed-ended
- Open-ended vehicles must adopt liquidity tools from a prescribed set
- Delegation arrangements face closer scrutiny on where decisions actually happen
- Reporting under Annex IV continues, with expanded data points
Anyone launching now should build to the new standard rather than the old one, since retrofitting a structure is materially more expensive than designing it correctly.
Tax Treatment
What We Handle, and What Stays With You
Handled by C. Savva & Associates
- Vehicle selection weighed against strategy, investor base and marketing plans
- Structuring the whole chain from investors down to portfolio holdings
- Preparation of the offering memorandum and constitutional documents
- Regulatory filing and correspondence through to approval or registration
- Introductions to depositaries, administrators, auditors and host managers
- Corporate administration, directors and registered office
- Accounting, NAV support and statutory reporting
- Investor onboarding documentation
- Ongoing tax advice as the portfolio develops
Retained by You
- Investment strategy and portfolio decisions
- Raising the capital
- Appointing the manager, where you are not using a host
- Funding regulatory and service provider costs
Timeline and Cost
Working With Our Partner Law Firm
C. Savva & Associates is not a law firm. For matters requiring legal expertise, the firm works alongside its partner law firm Nicholas Ktenas & Co., LLC, which provides legal counsel on corporate and commercial law, banking and finance, data protection, intellectual property, employment law, and trusts. Nicholas Ktenas has been recognised by Best Lawyers, Who’s Who Legal and Legal 500.
Why Promoters Work With Us
- Operating since 2009, across the 2014 framework, its 2018 overhaul and the current directive cycle
- The regulator supervised 319 management companies and collective schemes in the second quarter of 2025, holding roughly €10.6 billion in AUM, so the ecosystem is deep enough to support a launch without importing everything.
- Licensed and regulated, with authorisations on our licensing page
- Tax structuring and corporate administration under one roof, so the vehicle is designed by the people who will run it
- We tell promoters when their strategy does not justify a regulated vehicle at all
- Memberships listed on our memberships page
What Happens When You Get in Touch
- You describe the strategy, target investors and expected size
- We respond within one working day
- The first conversation costs nothing
- A written structuring note follows, comparing vehicle options with costs
- Documentation begins on your instruction
Nothing is billed until you accept a written engagement letter.
Request a structuring noteSet Up Your Fund Structure With Advisers Who Administer It Afterwards
Tell us the strategy, who you expect to raise from, and your target size. We will come back with a written comparison of the vehicle options and what each costs to establish and run.
Call +357 22 516 671, message the team on WhatsApp, or write and expect a reply within a working day.
Speak to Charles SavvaFrequently Asked Questions
What is the best investment in Cyprus?
That depends entirely on your objective, and anyone answering it generically is guessing. Property has historically attracted foreign capital, particularly where a purchase also supports a residence application. Regulated vehicles suit promoters raising external money rather than deploying their own. Shipping, technology and renewable energy each draw institutional interest for different reasons. The regulated structure question is separate from the asset question: the vehicle is a wrapper, and picking it well matters only once you know what goes inside.
What are the alternative investment funds?
Three vehicle types operate here. The unlimited variety is fully authorised, accepts retail money and faces no cap on investor numbers. The limited variety is capped at fifty natural persons drawn from well-informed or professional investors and follows a lighter route. The registered variety is not authorised at all, being registered with the regulator instead and externally managed by an authorised manager, which makes it the quickest to launch but closes it to retail money.
What are the most common alternative investments?
Private equity and venture capital dominate by value, followed by real estate strategies and private credit. Hedge strategies, infrastructure, shipping and commodities each occupy meaningful niches. What unites them is illiquidity and a lack of daily pricing, which is precisely why they sit outside the harmonised retail framework designed for transferable securities. Vehicle choice usually follows liquidity: closed-ended structures for genuinely illiquid holdings, open-ended ones where redemptions can realistically be met.
What is the most profitable business in Cyprus?
Financial and professional services, shipping and technology consistently generate the strongest margins, with the island hosting one of Europe’s larger ship management clusters and a growing base of relocated technology operations. Tourism produces volume rather than margin. For anyone considering a regulated launch, the more relevant point is that the supporting ecosystem of administrators, depositaries and auditors is mature enough to service institutional expectations at costs well below the larger domiciles.
Do I need my own management company?
No, and most first-time promoters should not build one. Appointing a third-party host manager gives you an authorised entity without the capital requirement, the substance obligations or the hiring. You retain influence over strategy through the investment committee while the host carries the regulatory responsibility. Building your own becomes worthwhile once AUM justifies the overhead, and the structure can be migrated later without unwinding the vehicle itself.
Can the structure hold assets outside Cyprus?
Yes, with no restriction on where portfolio holdings sit. Vehicles established here routinely hold real estate, private companies, credit exposures and listed positions across Europe, the Gulf, Asia and North America. The treaty network supports efficient repatriation of returns, and umbrella compartments allow geographically distinct strategies within one legal wrapper. Local presence is required of the vehicle and its service providers, not of the portfolio.