The Cabinet decided on Tuesday to establish a unified supervisory authority for companies providing administrative services. The Minister of Finance, Makis Keravnos, announced after the Cabinet meeting that with the approval of this authority, the supervision of administrative service providers will be strengthened and upgraded.

This task will be assigned to the Securities and Exchange Commission, which, in collaboration with the relevant supervisors - the Bar Association and the Institute of Certified Public Accountants of Cyprus (ICPAC), will oversee these companies.

Keravnos further stated that the supervisory authority is tasked with monitoring all companies in the sector. Joint inspections with the two relevant supervisors will be conducted in cases where there is relevant information or indications that may impact the Republic's reputation.

According to the Minister, as part of this supervisory authority and following the Cabinet's decision, the governance of companies offering administrative services is being bolstered. This enhancement includes defining the qualifications of individuals providing these services and setting a maximum number of companies they can serve, aligning with standards in other EU countries.

Mr. Keravnos mentioned that this decision lays a fundamental stone in a structure that will now protect the name of the Republic of Cyprus and upgrade the services offered under a unified, strict supervisory control.

Responding to a question, he noted that if there are announcements of sanction violations, the mechanism will be able to investigate them, and preventive checks will also be conducted "to act proactively."

He explained that following the approval, consultation with stakeholders will begin to determine specific mechanisms and criteria for supervision.

The Bar Association has labeled the Cabinet's decision to establish a unified supervisory authority for companies providing administrative services as unacceptable, arguing that the decision was made without effective prior consultation.

In a statement following yesterday's remarks by the Minister of Finance regarding the Cabinet's decision, the Association warns that the implementation of this decision would represent "another action undermining the rule of law, as has been the case in several other instances, with the recent example of the issues concerning the protection of journalistic confidentiality."

The Association also believes that the specific decisions were extensively analyzed by European lawyers who handled the case before the Court of Justice of the European Union at a conference of the Cyprus Bar Association dated January 16, 2024. The Ministry of Finance was invited to participate in this conference but did not attend. Therefore, the Association notes, invoking European practices to justify the Cabinet's decision is baseless.

Furthermore, the Association "with regret" observes that this decision is taken "in an attempt to obscure and cover up the weaknesses shown by executive authorities in the implementation of sanctions, particularly by the Sanctions Implementation Unit, as well as an attempt to shift their responsibilities."

The Association assures that it will take all necessary actions to uphold the principle of the rule of law, including the faithful observance of the decisions of the Court of Justice of the European Union, and will inform all European and international bodies.

"Such decisions will lead to a contraction of the service provision sector, a sector that constitutes a significant pillar of the Cypriot economy," the statement concludes.