Other services - Cyprus
Bridge settlement
Cypriot securities are not eligible for settlement through the Bridge with Euroclear Bank.
CBL's securities lending and borrowing and collateral management services
Cypriot government debt held in CBL may qualify for CBL’s securities lending and borrowing programme and collateral management services.
For further details, please refer to the Collateral Lending and Liquidity solutions available on the Clearstream Banking website.
Compliance
The U.S.A. asserts jurisdiction over transactions involving securities issued or held for custody in the U.S.A., even where the link between the transaction and the U.S.A. is quite attenuated. Some U.S. economic sanctions laws have extraterritorial effect and others impose or threaten third parties' actions with secondary boycotts, which may affect the third parties' access to U.S. financial or other markets. U.S. financial institutions and, in some cases, their foreign-incorporated subsidiaries and affiliates, are subject to U.S. regulations, even when operating outside the U.S.A. CBL intermediates transactions involving securities in which the U.S.A. is the jurisdiction of issuance or custody. CBL also engages U.S. financial institutions to provide custody, depository and other services in selected non-U.S. jurisdictions based on the quality of the services offered and CBL’s other requirements. Such U.S.-owned or controlled institutions may be required to refuse or even block/freeze transactions directly or indirectly involving parties subject to U.S. economic sanctions regulations, regardless of the law of the jurisdiction in which the U.S. institution operates. CBL conducts its business to comply with all laws applicable to CBL. Accordingly, CBL may not be able to complete or may refuse or block/freeze transactions in or through a CBL account that, in CBL's judgment, may expose CBL to U.S. laws and regulations even where neither CBL nor the client is directly subject to such laws, but where CBL’s chosen custodian or depository is subject to such laws.
Where a U.S.-linked institution serves as CBL’s custodian or depository, the client acknowledges and accepts the obligation to comply and ensure compliance by any of the client’s underlying clients, up to the ultimate [legal and] beneficial owner, with any U.S. law, regulation, sanction, order, judgment, injunction, asset freeze, blocking regulation or order or any other act or action of, or by, any national or foreign government, authority, court, (self-) regulatory organisation, government agency or instrumentality of government, including, but not limited to, investment and holding restrictions (“U.S. Regulations”) applicable to any of the client, its underlying clients or CBL. The client shall not hold or seek to hold CBL liable for actions by CBL’s chosen custodian or depository to comply with U.S. Regulations applicable to such custodian or depository. The client shall not, by action or inaction, cause CBL to violate a U.S. Regulation and shall be liable for and hold CBL harmless against any direct or indirect loss, claim, damage, liability or expense, imposed on or incurred by or asserted against CBL in connection with any actual or alleged non-compliance with the aforesaid by the client or any underlying client of such client up to the ultimate [legal and] beneficial owner.
Please also refer to the Resource Center of the U.S. Department of the Treasury.
Risk
Clients holding Cypriot securities in CBL should take into consideration the possible risks arising from the fact that the securities are held in Clearstream’s own omnibus account at the Cypriot CSD with Citibank Europe Plc Greece branch acting as an Account Operator of this omnibus account. Citibank Europe Plc Greece branchas an entity is subject to Greek laws and restrictions, as applicable. Any limitations in services provided in Greece are likely to impact the services provided on Cypriot securities.
Disclosure requirements
Please refer to Disclosure Requirements - Cyprus, which is an appendix to the Creation Market Guide.
Holding restrictions
Due to Cypriot restrictions, clients are not allowed to hold Cypriot financial instruments, except government debt securities, in Clearstream Banking for underlying beneficial owners that are Cypriot residents or legal entities that are incorporated in Cyprus.
Clients are allowed to hold Cypriot government debt securities for underlying beneficial owners that qualifies as a Cypriot credit institution. Other Cyprus residents or legal entities that are incorporated in Cyprus will not be allowed to hold Cypriot securities via Clearstream
For details of other local holding restrictions, please refer to the Investment regulation section of the Market Profile - Cyprus.
Tax services
Income payments on Cypriot securities may be subject to Special Contribution for Defence (SCD) deducted by the issuer at source. No relief is available from the SCD via Clearstream Banking and Clearstream Banking does not assist in this regard.
For general information, please refer to the Clearstream Banking Cyprus Tax area.