Cyprus Incorporation Services
General information
Cyprus, the third-largest island in the Mediterranean after Sicily and Sardinia, is strategically situated at the crossroads of Europe, Asia, and Africa in the northeastern Mediterranean Sea. Covering an area of 9,251 square kilometers, Cyprus is positioned 65 kilometers south of Turkey, 96 kilometers west of Syria, 385 kilometers north of Egypt, and approximately 980 kilometers southeast of Athens. Its capital is Nicosia. The island’s topography features two mountain ranges running through the center and northeast, separated by a wide and fertile plain, creating diverse landscapes. Cyprus enjoys a pleasant climate, characterized by dry, hot summers and mild winters.
Population
Cyprus is home to a population of about 802,500 individuals. Greek Cypriots comprise the largest ethnic group, representing approximately 85% of the population. Turkish Cypriots constitute the second-largest community, making up 12%, while the remaining 3% comprises various other minorities.
Political structure
Cyprus achieved independence and became a republic in 1960. It embraces a political system modeled on Western democracies, emphasizing individual rights and fostering private enterprise. Cyprus operates under a presidential system of government. The President serves as the Head of State and is elected for a five-year term. The Council of Ministers, appointed by the President, forms the executive arm of the government and is responsible for the administration and implementation of legislation.
Legislative power is vested in the House of Representatives, composed of 56 elected members with five-year terms. Cyprus follows a multi-party system and employs proportional representation in its electoral process. The legal system, resembling the United Kingdom’s, derives much of its business laws and procedures from English Law. Official translations of most laws are available in English.
Infrastructure and Economy
Cyprus is easily accessible by air and sea, with major port facilities in Limassol and Larnaca along the island’s south coast. The Cypriot economy operates on a free enterprise system, with the government’s role mainly focused on regulation, planning, and public utilities. Over the past fifteen years, Cyprus has demonstrated remarkable economic growth, coupled with relative stability in its currency.
Language
The official languages of Cyprus are Greek and Turkish, but English is widely spoken and understood, particularly in commercial and governmental sectors.
Currency
The official currency in Cyprus is the Euro (EUR).
Type of law
Cyprus’s legal system combines Common Law with Civil Law influences, mainly in Family and Constitutional/Administrative Law.
Main corporate legislation
The main corporate legislation in Cyprus is the Cyprus Companies Law, Cap.113, based on the English 1948 Companies Act. Single-member companies, known as International Business Companies (IBCs), were introduced in 2003, but favorable tax regimes for IBCs were abolished on January 1, 2003, subjecting all companies to similar tax policies.
Cyprus company any information
When wholly foreign-owned, a private company is referred to as an international business company. On 1 st January 2003 the favorable tax regime previously available to IBC’s was abolished and all companies are now taxed on the same basis.
Type of Company for International Trade and Investment
For international trade and investment, Cyprus offers Company Limited by Shares, which is subdivided into:
• Public Companies
• Private Companies, including Exempt Private Companies and Limited Private Companies
• Company Limited by Guarantee
Cyprus also provides for two general types of Partnerships under the Partnerships and Business Name Law, Chapter 116:
• General Partnership
• Limited Partnership
Procedure to Incorporate
To incorporate a company in Cyprus, you must submit the Memorandum and Articles of Association to the Registrar of Companies, along with an affidavit before a court and the appropriate registration fee. The powers and objectives of a Cyprus company must be clearly specified in its Memorandum & Articles of Association.
Restrictions on Trading
Companies in Cyprus are prohibited from engaging in banking, insurance, or offering financial services to the public without special permission. Additionally, companies cannot conduct trade with resident individuals or entities in Cyprus.
Language of Legislation and Corporate Documents
Both Greek and English are official languages for legislation and corporate documents.
Registered Office Required
Yes, a registered office must be maintained in Cyprus.
Time to Incorporate
Incorporation in Cyprus typically takes about five days, contingent upon name approval.
Name Restrictions
Names that the Registrar deems undesirable or similar to existing companies are not permitted. Names implying illegal activities or royal or government patronage are also restricted.
Language of Name
Company names may be expressed in Greek or any language using the Latin alphabet, provided the Registrar receives a Greek or English translation and deems the name not undesirable.
Names Requiring Consent or License
Certain names or their derivatives, such as “Asset Management,” “Bank,” “Brokerage,” “Insurance,” and others, require consent or licensing. The Registrar’s approval is essential for such names.
Suffixes to Denote Limited Liability
Companies in Cyprus typically use “Limited” or “Ltd.”
Disclosure of Beneficial Ownership to Government Authorities
The identity of beneficial owners can remain confidential if nominee shareholders act on behalf of the ultimate beneficial owners. This confidentiality is maintained as long as the company and its ultimate beneficial owners remain uninvolved in any criminal activity.
Compliance
Authorized and Issued Share Capital
Companies in Cyprus can express their share capital in Euros or any other currency. The standard authorized share capital for a Cyprus IBC company is €5,000, and the minimum issued capital is €1,000.
Classes of Shares Permitted
Cyprus companies can issue registered shares of par value, preference shares, redeemable preference shares, and shares with no voting rights.
Directors
Cyprus companies must have at least one director, who can be a natural person or a corporate entity, of any nationality. Directors are not required to be residents of Cyprus; however, having resident directors is advisable for establishing tax residency.
Company Secretary
All Cypriot companies must appoint a company secretary, who can be a natural person or a corporate body. It is advisable to appoint a resident company secretary for compliance.
License Fees
Cyprus does not impose specific license fees.
Financial Statements Required
As of 2003, the Companies Law requires every company to prepare a full set of financial statements in accordance with International Financial Reporting Standards (IFRS). Additionally, parent companies with one or more subsidiaries must present consolidated financial statements.
Shareholders
Cyprus companies require a minimum of one shareholder.
Key Corporate Features
General
- Type of Entity: Private (Resident/Non-resident)
- Type of Law: Common
- Shelf Company Availability: Yes
- Time to Establish a New Company: 5 days
- Minimum Government Fees (Excluding Taxation): €350
- Corporate Taxation: Resident Limited (12.5%), Non-resident (0%)
- Double Taxation Treaty Access: Yes
Share Capital or Equivalent
- Standard Currency: Euro
- Permitted Currencies: Any
- Minimum Paid-up Capital: €1,000
- Usual Authorized Capital: €5,000
- Minimum Number: One
- Local Required: No, but advisable for tax residency
- Publicly Accessible Records: Yes
- Location of Meetings: Anywhere, but Cyprus is advisable for tax residency
Members
- Minimum Number: One
Company secretary
- Required – Yes
- Local or qualified – No, but Cyprus advisable for residency and compliance
Accounts
- Requirement to prepare – Yes
- Audit requirements – Yes
- Local Auditor – Yes
- Requirement to file accounts – Yes
- Publicly accessible accounts – No
Other
- Requirement to file annual return – Yes
- Change in domicile permitted – No
NOTE: When wholly foreign-owned, a private company is referred to as an International Business Company.
In resume
Cyprus, one of the smallest European low tax jurisdictions, is a suitable place for locating an intermediary company due to the island’s combination of tax treaties and low-tax regime. Dividends can flow through the Cyprus company totally tax free and the company can be used to take advantage of the extensive network of double tax treaties.
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