Alfa Capital Markets Ltd, in accordance with the rules of the Cyprus Securities and Exchange Commission, is required to classify its customers into one of the following categories:
Maximum degree of investor protection is given to Retail Clients while minimum protection is given to Eligible Counterparties.
These are the clients who possess the knowledge and expertise to make their own investment decisions and properly assess the risks they incur. A client, could be treated as “Professional” if he/she falls in any of the categories below:
- Entities which are authorised or regulated to operate in the financial markets, including those authorised by a Member State or a third counry;
- Large undertakings, meeting, as a minimum, two of the following size requirements:
Balance sheet total of at least €20,000,000
Net turnover of at least €40,000,000
Own funds of at least €2,000,000
- National and regional governments, public bodies managing public debt, central banks, international and supranational institutions and other similar international organisations;
- Other institutional investors, whose main activity is to invest in financial instruments.
Although these clients are considered to be professional, they must be allowed to request non-professional treatment and higher levels of protection.
When a client is considered a professional client, the Company must inform prior to undertaking any services that he/she will be treated as a professional client, unless otherwise agreed between the parties. In addition, the Company must inform the client that he/she can request to be treated as non-professional, and thus be subject to a higher level of protection. It is the client’s responsibility to request to be treated as a non-professional.
Eligible counterparties are investment firms, credit institutions, insurance undertakings, UCITS and their management companies, pension funds and their management companies and other financial institutions authorised by a member state or regulated under community legislation or the national law of a member state, national governments, central banks and supranational organisations. In addition, the Cyprus Securities and Exchange Commission, recognises as eligible counterparties member state undertakings meeting predetermined criteria and third country entities with equivalent status.
In dealing with these counterparties, the Company does not have to meet specific MiFID obligations, including best execution procedures.
When dealing with eligible counterparties, the Company obtains express confirmation from the counterparty that it agrees to be treated as an eligible counterparty. This can be obtained either as a general agreement or on a transaction by transaction basis.
These are all clients who do not fall under the Professional or Eligible Counterparties categories.
Under MiFID, Professional Clients and Retail Clients can move between categories. In particular, Retail Clients can request to be treated as Professional Clients and Professional clients can request retail protections.
Under MiFID, Investment Firms must take reasonable steps to ensure that a Retail Client requesting Professional Client treatment is able to meet similar qualitative criteria regarding his/her knowledge and experience. Moreover, at least the two of the following quantitative criteria must be met:
- the client has carried out transactions, in significant size, on the relevant market at an average frequency of ten per quarter over the previous four quarters
- the size of the client's financial instrument portfolio, defined as including cash deposit and financial instrument, exceeds €500,000
- 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
Clients have the right to request a different classification in order to benefit from a higher degree of regulatory protection should they require it.
Please go to the section "CLIENT AREA" to familiarise yourself with our MiFID documents.