Alfa Capital Markets Ltd is a member of the Investors Compensation Fund for customers of Cypriot Investment Firms (the “Fund” or “ICF”) whose competences and operations are regulated by the provisions of the Law 87(I)/2017 and Directive DI87-07 of the Cyprus Securities and Exchange Commission for the operation of the Investors Compensation Fund as amended from time to time.

The objective of the Fund is to secure the claims of the covered customers against the members of the Fund by the payment of compensation for their claims arising from the covered services provided by its members, so long as failure by the member to fulfil its obligations has been ascertained.

Failure by the Company to fulfil its obligations consists of its failure:

Covered Services are the investment services listed on the Company’s license.

The Fund covers all of the Company’s customers, except those falling in the categories below:

1. Institutional and professional investors falling in the categories below: 

•    Investment firms 
•    Legal entities associated with the Company and, in general, belonging to the same group of companies
•    Banks
•    Cooperative credit institutions
•    Insurance companies
•    Collective investment undertakings in transferable securities and their management companies
•    Social insurance institutions and funds
•    Investors characterized by the Company as professionals upon their request, pursuant to the provisions of Part II of the Second Appendix of the Law 87(I)/2017

2. Supranational institutions, government and central administrative authorities

3. Provincial, regional, local and municipal authorities

4. Enterprises that have close ties with the Company

5. Managerial and administration staff of the Company

6. Shareholders of the Company whose participation directly or indirectly in the capital of the Company amounts to at least 5% of its share capital, or its partners who are personally liable for the obligations of the Company, as well as persons responsible for carrying out the financial audit of the Company, such as qualified auditors

7. Investors having in enterprises connected with the Company and in general, with the group of companies to which the Company belongs, positions or duties corresponding to the ones listed in paragraphs 5 and 6 above

8. Up to second-degree relatives and spouses of the persons listed in paragraphs 5, 6 and 7, as well as third parties acting for the account of such persons

9. Customers of the Company responsible for facts pertaining to the Company that have caused its financial difficulties or have contributed to the worsening of its financial situation or which have profited from these facts

10. Other firms in the same group

11.  Investors in the form of a company which, due to its size, is not allowed to draw a summary balance sheet in accordance with the Companies Law or a corresponding law of a Member State

The Fund will commence the compensation payment process in at least one of the following circumstances:

1. The Cyprus Securities and Exchange Commission has determined that the Company appears, for the time being, for reasons directly related to its financial circumstances, to be unable to meet its obligations arising out of investors’ claims and has no early prospect of being able to do so.

2.  A Court of the Republic, has made a ruling, for reasons directly related to a member financial circumstances, which has the effect of suspending investors’ ability to make claims against it.

The Cyprus Securities and Exchange Commission shall issue its decision for the initiation of the compensation payment procedure by the Fund within a reasonable time, and publish the relevant information on its website. Upon initiation of the compensation payment procedure, the Fund shall publish as soon as possible in at least two national newspapers, an invitation to submit applications for compensation, designating the procedure for the submission of the relevant applications, the deadline for their submission as well as their content. The said publication shall be communicated immediately to the Cyprus Securities and Exchange Commission, which shall post the publication on its website. In exceptional and justified cases, the Fund, with an announcement thereof, may extend the deadline for the submission of compensation applications up to three months, provided it obtains the approval of the Cyprus Securities and Exchange Commission. The said announcement shall be published by the Fund in at least two national newspapers, and the Cyprus Securities and Exchange Commission shall publish it on its website. 

In case a covered customer was not in a position to submit such application within the deadline, the deadline of paragraph above shall not apply thereto, if conditions occurred that prevented the observance of the deadline for the submission of a compensation application or for the collection and submission of the information required.

A covered customer submitting a compensation application after the deadline, shall submit, in addition to the information forming the content of the application, a declaration explaining the reason, if any, for which he was not in a position to claim compensation in time, attaching all supporting evidence to that end. 

The payment of compensation by the Fund shall entail the following: 

(a) the initiation of the compensation payment procedure; 

(b) the existence of a valid claim by a covered customer against the Company, which derives from an investment operation;

 (c) the submission of an application form as prescribed in Directive DI87-07 of the Cyprus Securities and Exchange Commission; 

(d) that the claims do not arise from transactions for which there has been a criminal; 

(e) conviction for money laundering as defined in the Prevention and Suppression of Money Laundering Activities Law as amended from time to time;

(f) there are no pending criminal proceedings against the said covered customer for money laundering as defined in the Prevention and Suppression of Money Laundering Activities Law as amended from time to time; 

(g) the right of a covered customer has not been extinguished under the Limitation of Offenses Act.

The amount of the claim of a covered customer shall be calculated based on legal and contractual conditions, in particular those relating to offsetting and counterclaims, that are applicable to the assessment on the date of the initiation of the compensation payment procedure of the amount of the funds or value determined with reference to the market value, where possible, of the financial instruments belonging to the covered customer and which such funds or instruments, the Fund member fails to repay or return, respectively. 

The calculation of the compensation payable shall arise from the sum of the total established claims of the covered customer against the Company, arising from all covered services provided by the Company and regardless of the number of accounts of which it is the beneficiary, the currency and place where such services are provided within the European Union.

The maximum limit of coverage will be either the 90% of the cumulative covered claims of the covered customer, or the amount of €20.000, whichever is lower. Compensation shall be paid in Euro, and, where the funds and/or financial instruments are expressed in a currency other than the Euro, the exchange reference rate of the said currency against the Euro fixed by the European Central Bank at the end of the day on which the compensation payment procedure was activated, shall be used.

The Fund may at any time require the covered customer to return the compensation paid to it if it subsequently establishes that there has been a reason for the rejection of the application.

Upon completion of the procedure for the examination of the applications, the Fund:

(a) issues a decision listing the customers of the Fund member, determining the amount of money each one of them is entitled to receive, and communicate it to the Cyprus Securities and Exchange Commission and the Company within five working days from its issue; The said decision shall also list those customers to whom no compensation shall be paid, and the reasons for this;

(b) communicate to each affected customer its decision the soonest possible from its issue.

The claimant to whom the Fund communicates its decision, may, in case of disagreement, submit an objection in writing to the Cyprus Securities and Exchange Commission, within one month from the date on which the decision was notified, justifying its objection sufficiently. The objection shall be submitted at info@cysec.gov.cy and entitled “Objection to the decision of the ICF”.

The Cyprus Securities and Exchange Commission in the context of examining an objection may request from the Fund, and/or the Fund member and/or the claimant to submit information and particulars; and conduct any investigation.

The Cyprus Securities and Exchange Commission must conclude the examination of the objection within forty-five (45) days and in case that identifies an error in the evaluation carried out by the Fund, it shall request in writing from the Fund to immediately rectify the mistake and pay the claimant the correct amount, and inform the affected customer accordingly.

The Fund is obliged to pay to each covered customer/claimant the compensation that he is entitled to within three months from the date that the decision was communicated to the covered customer. In extraordinary and justified circumstances, the Fund may request from the Cyprus Securities and Exchange Commission an extension of the said deadline. The said extension may not exceed three months.

The payment of the compensation by the Fund is deposited to a bank account of the covered customer designated by the latter in writing to the Fund.

A physical or electronic copy of this document (the Company’s ICF prospectus) can be requested from our Customer Support.

For further information about the Investor Compensation Fund, please refer to the following link www.cysec.gov.cy.