How can investors become Cypriot citizens

The Cyprus Government, by a decision of its Council of Ministers of 19 March 2014, has clarified and expanded the conditions upon which foreign investors may become Cypriot citizens through naturalisation.  

At a time when the Cypriot economy is on a path to recovery, there are a number of interesting investment opportunities which present themselves.

Cypriot citizenship provides all the benefits of a passport-holder of a member state of the European Union

For further details please download this pdf brochure.  

Business as usual for multinational companies in Cyprus

The unprecedented decision by the Eurogroup of countries to propose a haircut on deposits in Cyprus sent shock waves through the European Union. Irrespective of whether or not the haircut will be put in place, it is certain that the Cyprus banking industry will never be the same.

How will this affect the future of the international financial services sector in Cyprus? Despite the bad news, service providers in the tax, accounting and legal services sectors report on new clients and additional investments in Cyprus. For example global providers of products and services to the energy industry are proceeding with their investments in Cyprus in anticipation of the further development of the oil and natural gas resources of Cyprus.

Cyprus is and remains the foremost business hub for investments between Europe and the rest of EMEA. Even with a corporate income tax rate of 12.5% Cyprus will continue to have one of the lowest income tax rates in Europe, and to be highly attractive to private equity funds, publicly listed companies and major financial institutions. The traditional features that have made Cyprus an attractive structuring destination remain effectively unchanged; amongst others Cyprus has in place 47 double taxation treaties, companies enjoy a full participation exemption on capital gains and dividend income, and there is no withholding tax on dividends, interests and royalties.

Alex Hooft van Huysduynen, Managing Director of TMF Group Cyprus, said: “Over the past few days we have spoken to several multinational companies based in Cyprus. It is clear to me that these companies do not consider the domestic banking crisis as an impediment to their investments in and through Cyprus and that business will continue as usual."

Kypros Ioannides, partner of Nicosia-based corporate law firm Hadjianastassiou, Ioannides LLC said: “The Cyprus banking system and its corporate structures are distinctly separate. The recent uncertainty surrounding the banking sector has not affected the demand for quality legal and professional services from firms and financial institutions with structuring projects and direct investments involving Cyprus companies.”

http://www.tmf-group.com/news.aspx

Consultation on the cross-border transfers of registered offices of companies

As promised in the Action Plan on company law published on 12/12/2012, the EU Commission launched an on-line consultation specifically devoted to the question of the cross-border transfers of registered offices of companies in the EU.

Please find the link to the consultation - http://ec.europa.eu/internal_market/consultations/2013/seat-transfer/index_en.htm

Cyprus has adopted since 2006 legislation providing for both inwards (to Cyprus) and outwards (from Cyprus) transfer of corporate seats to and from countries which allow such transfers under their local legislation.  

Regulation of fiduciary services

A new law (entitled Law regarding the regulation of business providing fiduciary services and related matters of 2012 - Law 196(I)/2012) has been enacted and has come into force on 21/12/2012.  

The law is intended to govern the licensing and regulation of undertakings providing management, fiduciary and related services to private companies.  The supervisory authority for the licensing and regulation of such undertakings is the Cyprus Securities and Exchange Commission (Cysec). 

Advocates (including law firms) regulated by the Cyprus Bar Association and licensed accountants regulated by the Institute of Certified Public Accountants of Cyprus  are exempted from regulation under the new law. 

 A copy of the new law (in Greek) is available here

Company Directors: Jurisdictional Comparison

KGMC Legal contributes the Cyprus chapter in Company Directors: Jurisdictional Comparison issued by Thomson Reuters, European Lawyer reference Series in December 2012. 

First Edition 2012; Thomson Reuters
European Lawyer Reference Series
Cyprus Chapter by Kypros Ioannides, Hadjianastassiou, Ioannides LLC

Jurisdictional chapters cover, but are not limited to:

  • General Information on the corporate governance of companies
  • Appointment, revocation, resignation and replacement of directors
  • Relationship between directors and the company
  • Director’s obligation
  • Resolutions of directors and board of directors
  • Delegation of powers to single directors
  • Civil liability of directors
  • Criminal liability of directors 

For a pdf of the Cyprus Chapter click here
For the publication's website click here