Read the CySEC Circular C680
Memo #06-2025
CySEC Circular No: C680
Date: 03/02/2025
Subject: ESMA launches a Common Supervisory Approach with NCAs on MiFID II sustainability requirements
Purpose: To inform CIFs that ESMA has launched the CSA 2024-25 with NCAs on the integration of sustainability in firms’ suitability assessment and product governance processes and procedures in 2024.
In Summary:
CySEC has issued the Circular C680 on 31/01/2025 to inform the Cyprus Investment Firms (CIFs) that the European Securities and Markets Authority (ESMA) has launched the CSA 2024-25 with national competent authorities (NCAs) on the integration of sustainability in firms’ suitability assessment and product governance processes and procedures in 2024.
In accordance with C680, the CSA 2024-25 will cover the following aspects:
• How the firms collect information on their clients’ “sustainability preferences”;
• Which arrangements firms have put in place to understand and correctly categorize investment products with sustainability factors for the purpose of the suitability assessment;
• How firms ensure the suitability of an investment with respect to sustainability (including the use of a “portfolio approach”);
• How firms specify any sustainability-related objectives a product is compatible with as part of the target market assessment of the investment product.
CySEC informs that it is planning to conduct on-site visits and/or desk-based reviews on a sample of CIFs that provide the Investment services of Investment Advice and/or Portfolio Management to retail clients, from the 2nd of August 2022 to 31st of December 2024.
The Circular C680 includes the Regulatory Framework that CySEC will consider for the purposes of the CSA 2024.
CySEC further informs that it expects CIFs to adhere to the content of Circular C680 as this will form part of CySEC’s supervisory review for the purpose of the CSA 2024-25.
The CSA 2024-25 can be found on the following link:
Read the CySEC Circular C680
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