Which firms and activities does Law 87(I)/2017 exempt?

The exemptions mirror MiFID II Article 2. Most go to bodies that another regime already governs. Insurance, reinsurance and retrocession undertakings are exempt when carrying on insurance business. Collective investment undertakings and pension funds, whether or not coordinated at EU level, are exempt together with their depositaries and managers; fund managers' own regime is covered in Which managers fall under the AIFM Law, and how can CySEC change, suspend or withdraw an authorisation?. Members of the ESCB (the European System of Central Banks), other national bodies with similar functions, public debt managers and international financial institutions set up by two or more Member States are exempt. So are central securities depositories, except when they provide investment services in addition to their CSD services, and crowdfunding service providers authorised under Regulation (EU) 2020/1503; see What are the rules for tied agents, eligible counterparties and crowdfunding?.

Others are exempt because their investment business is narrow or incidental: firms serving only their parent, subsidiaries or fellow subsidiaries; administrators of employee-participation schemes, alone or together with intra-group services; professionals whose rules allow investment services as an incidental part of their work; and people who give investment advice in the course of another profession outside the Law without separate payment for it. The list also includes associations set up by Danish and Finnish pension funds, the Italian 'agenti di cambio', and electricity and gas transmission system operators and balancing operators, except when they run a secondary-market platform.

The exam material mentions transmission system operators for natural gas only. Since the Law applied on 3 January 2018, the exemption has covered electricity as well as natural gas. The exam material's list also lacks crowdfunding service providers, which Law 78(I)/2021 has exempted since 10 November 2021.

Dealing on own account is a regulated investment activity: it appears in the Law's First Annex among the investment services and activities. A person who deals only on own account in financial instruments that are not commodity derivatives or emission allowances, and provides no other investment services in them, is exempt unless one of four triggers applies. The person is a market maker; is a member of, or participant in, a regulated market or MTF; uses high-frequency algorithmic trading; or deals on own account when it executes client orders. Non-financial firms that trade on a venue to manage liquidity or to reduce objectively measurable risks keep the exemption despite membership. Insurers, funds and commodity dealers exempt on their own grounds need not meet these conditions.

The exam material says that direct electronic access to a trading venue also removes the exemption. Since 17 October 2025, Law 183(I)/2025, transposing Directive (EU) 2024/790, has deleted that trigger. Only membership of, or participation in, a regulated market or MTF now counts, and the carve-out for non-financial firms covers liquidity management as well as risk reduction.

A person that deals on own account in commodity derivatives or emission allowances, including as a market maker, or provides other investment services in them to the customers or suppliers of its main business, is exempt if four conditions all hold. The activity is ancillary to the main business, judged at group level. The person is not part of a group whose main business is investment services, banking or market making in commodity derivatives. It does not use high-frequency trading. And it reports to CySEC, on request, the basis on which it considers the activity ancillary. Dealing for its own account while executing client orders is never covered. Delegated Regulation (EU) 2021/1833 sets the test for what counts as ancillary.

The exam material says the person must notify CySEC every year. Since 28 February 2022, Law 9(I)/2022, transposing Directive (EU) 2021/338, has removed the yearly notice; the person now reports to CySEC only on request. The group condition, which the exam material leaves out, is not new: it has applied since 3 January 2018 and was only reworded in 2022. Separately, operators under the EU Emissions Trading System are exempt when they deal in emission allowances only on own account, execute no client orders, provide no other investment services and do not use high-frequency trading.

Exemption does not mean freedom from every rule. Exempt persons remain subject to the limits and position-management controls for commodity derivatives, and to position reporting. Members of a regulated market or MTF who are exempt as insurers, funds, EU ETS operators or commodity dealers must also follow the algorithmic-trading rules, as explained in How do regulated markets admit instruments and members, and control algorithmic trading?.