Corporate Law at Cyprus
Certainly! Here’s a detailed overview of Corporate Law in Cyprus:
Corporate Law in Cyprus: Overview
Cyprus is a popular jurisdiction for international business due to its strategic location, EU membership, favorable tax regime, and robust legal framework based on English Common Law principles combined with Cypriot statutes.
1. Legal Framework
The primary legislation governing companies in Cyprus is the Companies Law, Cap. 113.
Cyprus is an EU member state, so its corporate law complies with EU directives on company law.
The legal system is a mix of Common Law and civil law, with a strong influence from English corporate law.
2. Types of Companies
Private Limited Company (Ltd) — the most common type, limited by shares.
Public Limited Company (PLC) — suitable for larger companies and public offerings.
Branch of a foreign company — established for foreign entities operating in Cyprus.
Limited Liability Partnerships (LLP) — allowed but less common.
3. Company Formation
Minimum of one shareholder and one director (can be the same person).
No minimum share capital requirement (usually issued share capital is €1).
The company must have a registered office in Cyprus.
Registration is done with the Department of Registrar of Companies and Official Receiver.
Articles of Association define company governance, modeled on the Table A model (similar to UK law).
4. Corporate Governance
Directors manage the company and owe fiduciary duties to it.
Shareholders’ meetings are required annually.
Companies must keep statutory registers (shareholders, directors, charges).
Annual return and financial statements must be filed with the Registrar.
External audit is mandatory unless the company meets criteria for exemption (small companies).
5. Taxation and Financial Reporting
Cyprus has a corporate income tax rate of 12.5% (one of the lowest in the EU).
Dividend income, capital gains on securities, and profits from foreign permanent establishments can be exempt.
Cyprus has a wide network of double tax treaties.
Companies must prepare annual financial statements according to IFRS.
6. Advantages of Cyprus Corporate Law
EU membership ensures regulatory stability and access to EU markets.
Efficient company registration and management.
Strong investor protection under EU and local law.
Flexibility in share capital structure (e.g., multiple classes of shares).
Strong confidentiality and data protection laws.
7. Compliance Requirements
Filing of annual returns and audited financial statements.
Compliance with Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations.
Maintenance of beneficial ownership registers as per EU directives.
Summary
| Feature | Details |
|---|---|
| Legal system | Common Law + Cyprus statutes (EU compliant) |
| Company types | Private Ltd, Public Ltd, Branch, LLP |
| Minimum shareholders | 1 |
| Minimum directors | 1 |
| Share capital | No minimum; usually €1 |
| Corporate tax rate | 12.5% |
| Registered office | Mandatory in Cyprus |
| Annual filing | Annual return, audited financials |
| Governing law | Companies Law, Cap. 113 |
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