Elia Nicolaou, the Managing Director of Amicorp Cyprus, had the pleasure to recently discuss Amicorp and the fiduciary services business in Cyprus and how Amicorp brings global capabilities to the island, and what we need to further develop this sector. The article appeared in the island’s magazine, Gold News, and written by Effy Pafitis.
The offices of Amicorp (Cyprus) Ltd., located on the top floor of a multi-storey complex in Nicosia, offer an expansive view of the heart and capital of Cyprus. The city has changed significantly in recent months, with consecutive developments in the island’s banking sector, real estate market, public and private sectors changing the face of its product and service offering. Despite these changes, however, some things remain the same: “If you want to be a proper global provider, you cannot remove Cyprus from your map,” affirms Elia Nicolaou, Managing Director of Amicorp (Cyprus) Ltd., in whose office I am standing and admiring the view.
Indeed, the firm’s presence in Cyprus is proof enough of her emphatic statement, confirming the island’s strategic relevance in the ever-evolving international business environment. Amicorp is a multinational firm offering a comprehensive range of trust and fiduciary services, from its more than 40 offices in over 30 countries, facilitating its sector dominance. The Group offers entity formation and administration, as well as a range of foundation formation, fund structuring, compliance, and outsourcing services to a variety of private and corporate clients. One of the top ten trust companies in the world and the best in emerging markets, its Cyprus office – I learn – was not created on a whim.
“The Cyprus branch was established following a number of successful years of cooperation with professionals on the island,” Nicolaou explains. At the time, the local fiduciary and trust industry had peaked in maturity and its local product offering was well-known in international business circles. Thanks to the island’s favorable tax regime, an established network of Double Tax Treaties, EU membership, its legal system and highly qualified workforce, the business community was wholly supportive and ready to accept such a prominent multinational fiduciary firm.
Unfortunately, though these advantages are still present, their relevance has declined in the light of Cyprus’ challenging reputation abroad, derived from its fiscal troubles in recent years. Thanks to the consolidated efforts of many professional sectors – including legal, accounting and banking – Cyprus has managed to attract significant investments from reputable multinational organizations and High-Net-Worth Individuals in recent years. Nevertheless, the island’s legal and tax frameworks, as well as its Double Tax Treaty network, have not been substantially improved during this period. “More importantly, the way we do business, in an ever-changing environment governed by transparency and compliance, is still not implanted in the foundations of our service and mentality,” Nicolaou observes, emphatically explaining that, for this reason, direct action must be taken to revive and indeed develop the local fiduciary industry.
The only way for the industry to survive is for it to be completely revamped and further benefit from the creation of new, out-of-the-box incentives to get structures through Cyprus and create substance on the island, she says. We don’t need to portray ourselves as a country from where one may operate just any company; in fact, Nicolaou explains, Cyprus can become a very reputable jurisdiction and follow in the footsteps of Luxembourg and the Netherlands, countries which have become renowned – and accepted – for their extreme due diligence. “It is just a matter of educating people on the many benefits of having transparent operations.”
The island’s fiduciary firms are not here to hide illegal proceeds, she continues, but rather to attract healthy and morally sound international organizations, while complying with increasing international transparency and anti-corruption requirements. “The faster we realize that changes are inevitable and adapt accordingly, the more chance we have of surviving as an industry.”
Learning from other countries which have implemented stricter regulations over the years would be one way to begin moving in this direction, she tells me, to which I wonder: is it appropriate to emulate these jurisdictions, considering the unique challenges faced by each market? “I don’t believe in the advantages of a second mover,” she says. “Emulating the practices of others, even in an improved way, can only give you limited attractiveness. I envision Cyprus exploiting its full upside potential through a fully re-engineered legal and tax system, following an outside-the-box approach. We have many intellectual professionals in Cyprus and with the support of international experts, we can make this happen!”
Though Nicolaou – who began with Amicorp (Cyprus) in 2007 as Director of Legal and Corporate Services, before assuming the role of Managing Director in 2009 – is clearly enthusiastic about encouraging the development of Cyprus’ fiduciary industry, its development does not in fact affect the operations of the firm. “Amicorp (Cyprus) doesn’t have any clients based in Cyprus,” she confides, revealing that the firm’s absence from the local market comprises an element of its strategic approach.
“I am not confident that a locally focused company would need the services that we offer – or would even be willing to pay for them,” she says, noting that Cypriot corporate culture dictates that most businesses will make use of services offered by family members or friends with legal and accounting practices rather than turning to a multinational firm to resolve any issues. “We are in no way looking down on the local market; it would simply not take advantage of the value-added that we are in a position to offer, and neither appreciate nor exploit it.”
Despite Amicorp’s absence from the local market, Nicolaou closely monitors its progress. Cyprus has done extremely well in achieving a respectable position on the international fiduciary map, she tells me, which is why all companies in the sector have a responsibility to aid its further development and attract additional multinational firms – such as Amicorp – to the island in the process. “We have to be grateful to the visionaries of the private sector who, 35 years ago, dreamt of making this small island a financial center,” Nicolaou affirms.
She is similarly grateful to the visionaries who, 23 years ago, established Amicorp’s first division, Amicorp NV, now Amicorp Curaçao BV. Following this, the firm embarked on consecutive developments throughout Latin America, before expanding further into Africa, Asia Pacific, North Americas and Europe, retaining its primary focus on the provision of trust and supplementary services throughout.
“We are not your typical trust company,” Nicolaou stresses, explaining that Amicorp’s steadfast focus isn’t common. In fact, many trust firms spring from law or audit firms which decide that the fiduciary business is more profitable and thus convert their operations.
In addition to the Group’s entity administration and financial services, Amicorp has also set up its own bank to facilitate client transactions and insurance company, as well as creating its own funds with approximately USD 9 billion under management – all of which are offered through its Cyprus location.
Furthermore, it has a team of specialists who are experts on Corporate Social Responsibility (CSR) and Philanthropy; in 2001, the firm established the Amicorp Community Foundation (ACF) as a channel through which to focus its social empowerment efforts, increase environmental consciousness and preserve biodiversity.
The Group sets aside 1% of its net profit annually for CSR activities throughout Latin America, Asia and Africa, which range from building a vocational and life skills training center in Bali, Indonesia, offsetting the Group’s carbon emissions by planting over 70,000 trees in Chile, providing day-care and child-care facilities for underprivileged children on the island of Curaçao and protecting endangered rhinoceros and elephants through projects in Africa.
Amicorp’s unique focus and targeted efforts to attain excellence in its corporate practices and social responsibility, it seems, may just be the root of the Group’s slogan and objective, to stand out from the crowd.