Regulation

https://www.cysec.gov.cy/en-GB/entities/investment-firms/tied-agents/

Authority to Operate: Tied agents, as defined in accordance with the Markets in Financial Instruments Directive (MiFID), operate under the authority of a MiFID investment firm. Below is an overview of how tied agents operate and the authority they fall under:

1. Tied Agents Definition: Tied agents are individuals or legal entities that, although not categorized as MiFID investment firms, maintain a close and exclusive relationship with a MiFID investment firm, known as the “principal.”

2. Authority and Supervision: Tied agents function under the authority and supervision of the principal MiFID investment firm. The principal assumes full responsibility for ensuring the tied agent’s compliance with all applicable regulatory requirements and conducts business in adherence to MiFID rules.

3. Roles and Responsibilities: Typically, tied agents undertake specific activities on behalf of the principal, which may encompass marketing and selling the principal’s financial products and services. They may be involved in client onboarding, providing information and investment advice to clients, and even handling the transmission of client orders.

4. Regulatory Compliance: Tied agents are obligated to adhere to the same regulatory standards and requirements as the principal investment firm. This includes strict compliance with MiFID regulations, customer protection rules, and all other relevant financial regulations.

5. Client Protection: Tied agents bear the responsibility of ensuring the best interests of clients and delivering suitable advice and services. They are also required to maintain robust systems and controls to safeguard client assets and data.

6. Reporting and Record-Keeping: Tied agents typically maintain records of their activities and transactions. They are obliged to report specific information to the principal investment firm, which, in turn, conveys this information to the pertinent regulatory authorities.

7. Termination of Relationship: The relationship between a tied agent and a principal investment firm may be terminated, either voluntarily or involuntarily. In the event of termination, the tied agent must cease all regulated activities and transfer any client relationships to the principal or another authorized entity.

8. Consumer Complaints: While tied agents may handle client complaints, it is important to note that the ultimate responsibility for resolving these complaints in accordance with regulatory requirements rests with the principal investment firm.

In summary, within the context of MiFID, tied agents serve as intermediaries or representatives of MiFID investment firms, conducting specific regulated activities on their behalf. Nevertheless, the primary responsibility for regulatory compliance and client protection lies with the principal investment firm, which holds the authority and supervisory role over the tied agent. This framework is designed to ensure the protection of clients and the conduction of financial services in strict adherence to MiFID regulations.

For pertinent information regarding public client policies and procedures, please refer to the following link on the webpage of Mega Equity Securities and Financial Services Public Limited: https://www.megaequity.com/home