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Cyprus Company Formation

Cyprus Company

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Our  Corporate & Commercial Department is pleased to assist you. Please fill out the form below so that we can provide you with a quick and efficient service. We will connect you with a dedicated lawyer who has the skills necessary to assist you.

 

The Republic of Cyprus offers a wide array of significant tax advantages and tax exemptions for a Cyprus company that can be used for a variety of purposes, including but not limited to, holding assets and shares in other companies, use as an investment vehicle, setting it up as part of a global structure of group of companies or as a place of headquarters for conducting international business.

Cyprus company formation or company registration refers to the process of incorporating a legal person in Cyprus, commonly referred to as the Company. The most popular Cyprus company formation is a private company limited by shares. This type of company allows shareholders to only be liable to the extent of the value of the shares they own.

Cyprus company formation is fairly simple and fast. The process commences with an application for name approval, and then following the approval of the name within 3 working days, the submission of application for incorporation before the Cyprus Registrar of Companies. Following the submission, the company will be incorporated between 7 to 10 working days.

Advantages of a Cyprus Company Formation

Cyprus enjoys one of the lowest corporate tax rates in Europe at 12.5%, making it an ideal destination for investors, entrepreneurs and international businesses looking to set up business operations in the EU.Cyprus companies can benefit from a network of double tax treaties with more than 60 countries, further reducing tax burdens and adding to the tax benefits of a Cyprus company.Dividends paid to a Cyprus tax resident company are exempt from corporation tax, subject to certain conditions. There is 0% tax on dividends received by a Cyprus tax resident company from a subsidiary company from abroad (subject to certain conditions) and there is 0% withholding tax on dividends received from EU subsidiaries by virtue of the EU Parent-Subsidiary Directive, provided that certain conditions are met. Dividends received from other Cyprus tax resident companies are exempt from all taxes, subject to certain anti-avoidance provisions. There is 0% withholding tax on dividends or interest or royalties paid by a Cyprus resident company to non-resident shareholders (certain conditions apply to royalties on rights used within Cyprus). This may be subject to double tax treaties between countries.There is 0% withholding tax is applied on the distribution of profit, except those arising from the disposal of property in Cyprus or profits arising from the disposal of the shares of a company that owns real estate in Cyprus.The Cyprus IP tax regime offers a tax benefit of up to 80% on profits qualifying for the regime derived from licensing or exploitation and gains on disposal of Intellectual Property, by way of notional expense deduction. With a corporate tax rate of 12.5%, this can result in an effective tax rate as low as 2.5%.
Cyprus company can be incorporated within 10 working days with low registration fees and minimal bureaucracy.
Cyprus company can be incorporated with 100% foreign ownership (of any nationality and citizenship). The presence of the shareholders and/or the beneficial owners in Cyprus is not required for the incorporation of the company since all procedures and communication can take place remotely, via emails and couriers.

Cyprus law allows the movement of the operating headquarters to or off Cyprus. The regulations give the opportunity to investors, entrepreneurs and international companies to become Cyprus tax residents and benefit from the attractive local tax regime.

The Cyprus Companies Law allows the redomiciliation of foreign companies into Cyprus and of Cyprus companies out of Cyprus, without such companies losing their corporate identity while ensuring their business continuity. In this way, operating headquarters can be moved to Cyprus or off Cyprus, allowing investors, entrepreneurs and international companies to become Cyprus tax residents and enjoy the advantageous tax regime of Cyprus.

Cyprus is one of the very few countries allowing the redomiciliation of non-EU companies into the Republic of Cyprus, making Cyprus a very lucrative business destination.

A Cyprus private company allows for a simple structure: in order to be incorporated requires, at minimum, one (1) shareholder and one (1) director. Both legal entities and natural persons (of any nationality and citizenship) can be appointed as shareholders and directors.

Through the careful use of nominee and/or fiduciary services, a Cyprus company can provide anonymity to its ultimate beneficial owners as well as safeguard assets held under such Cyprus company.

The names of directors and secretary are publicly accessible through the website of the Cyprus Registrar of Companies and the names of shareholders of a Cyprus company can be obtained via a paid search through the website of the Cyprus Registrar of Companies. Cyprus Law allows the use of nominee and fiduciary services so that the names of the controlling persons of a Cyprus company and its ultimate beneficial owners can remain confidential without public disclosure to the Cyprus Registrar of Companies. Through the use of a simple deed of trust or the more elaborate Cyprus International Trust, the shares of a Cyprus company be held on trust for the benefit of its ultimate beneficial owners while at the same time any assets under that Cyprus company are protected. 

Paris Mavronichis & Co LLC can provide both nominee and fiduciary services.

Being a full member of the European Union since 2004 and member of the Eurozone since 2008, Cyprus offers a safe and stable environment for international investors, high net worth individuals and companies, providing access to the European Union market of more than 500 million EU citizens and unrestricted access to EU directives and regulations. This is very advantageous for companies seeking to expand their business operations into the EU.

Cyprus is also member of the Commonwealth and its legal system is closely aligned with English common law system, making the Cyprus company and ideal vehicle for investments and holding assets. In addition, the Cyprus legal system in compliance with EU Directives and Regulations, the Financial Action Task Force on Money Laundering (FATF), OECD, FATCA, and the Financial Stability Forum laws.

With its strategic geographical location and its favourable tax incentives combined with an extensive network of double tax treaties, Cyprus is truly the business bridge connecting Europe, Asia and Africa and a hub between the three continents for business, tourism and residence, as well as an ideal hub for expanding into these regions.

Requirements to Register a Cyprus company

Because Cyprus companies can only be formed and registered through a licensed lawyer or law firm in the Republic of Cyprus, due diligence and know-your-client (“KYC”) procedures regarding a company’s beneficial owners, controlling persons, directors and secretary are mandatory by Cyprus law to take place before the registration of the Company.

The below are the required actions, information and documentation that must be collected before submitting an application for company registration at the Cyprus Registrar of Companies.

Company Name

The first step in the company formation is the application before the Cyprus Registrar of Companies for a company name. Up to three different names can be submitted at an application and they must not be unreasonably similar to a name of an existing company or legal entity or tradename or trademark.  For the name of a private limited company, the abbreviation ltd or limited will be included.The procedure from the moment of submission of the company name application until the approval of the company name by the Registrar of Companies takes 1 to 3 working days.

Company Activities

During our Firm’s KYC procedures, our clients will be requested to provide a short description of the business activities of the Company. This information will be used by our team of highly experienced lawyers to draft a comprehensive Memorandum and Articles of Association that will lay out the objectives of the Company and its rules of governance, in accordance with the desired goals of our clients.

Directors

The director is the most important person in the company and exercises all the company’s powers in accordance with the company’s Memorandum and Articles of Association and Cyprus Company Law. The director can be either a natural person or a company and it is not required to be a shareholder. The company must have at least one (1) director if it is a private company or at least two (2) directors if it is a public company. Following the incorporation of the company, additional directors can be appointed.In order for a company to be considered tax resident of Cyprus and enjoy Cyprus tax benefits and its low corporate tax, its management and control must be exercised in Cyprus so that substance can be proven. Therefore, a foreign businessman seeking to incorporate a Cyprus company that is considered Cyprus tax resident, must ensure that the director or the majority of the directors reside in Cyprus. Paris Mavronichis & Co LLC can provide this service as substance solution through the provision of directors, always based on the requirements of the position and level of qualifications the director must possess.The following preliminary information must be provided for KYC purposes for each director and bank account signatory that is to be appointed:
  • Passport copy
  • Business Address and Residential Address
  • Proof of permanent residential address, such as an original utility bill (electricity or water or gas or landline) not more than three (3) months old
  • Original reference(s) from a professional (e.g. Lawyer or Accountant) and from a Bank not more than three (3) months old
  • Detailed Curriculum Vitae (CV)
  • Occupation and Profession
  • Business Card and Contact Details

Shareholders

In accordance to Cyprus Company Law, a private limited liability company must have at least one (1) shareholder and cannot be more than fifty (50) shareholders. A public company must have at least seven (7) shareholders. The director can be either a natural person or another legal entity such as company, trust (through a trustee company) or a foundation.For confidentiality purposes, a trustee or nominee shareholder can be appointed as the registered shareholder in order to hold the shares of the company on trust for the real owner to ensure the real owner’s anonymity.The following preliminary information must be provided for KYC purposes for each shareholder / beneficial owner / controlling person that is to be appointed:
  • Passport copy
  • Business Address and Residential Address
  • Proof of permanent residential address, such as an original utility bill (electricity or water or gas or landline) not more than three (3) months old
  • Original reference(s) from a professional (e.g. Lawyer or Accountant) and from a Bank not more than three (3) months old
  • Detailed Curriculum Vitae (CV)
  • Occupation and Profession
  • Business Card and Contact Details
  • Evidence to support the Source of Funds and Source of Wealth

Secretary

The Cyprus law requires the appointment of one (1) secretary, that can be either a natural person or a company and it is not needed to be a shareholder of the company. In the case of a private company with one (1) shareholder and one (1) director, that director may also act as a secretary. Τhe role and functions of the secretary are administrative in nature, and usually limited to execution of bank documents when opening bank accounts, maintenance of statutory books of the company, keeping proper minutes of the general meetings, the upkeep of the registers of directors and members and the issuance and dispatch of necessary notices, and submission of any forms and reports to the Registrar of Companies, among others.Paris Mavronichis & Co LLC can provide you with a licensed lawyer to be appointed at your company as a secretary.

Registered Office

The Cyprus Company Law requires a company must maintain a registered office in the Republic of Cyprus, which must not be a mailbox, where all notifications and notices are sent (e.g. letters from the Registrar of Companies, Tax Office or any other authority), and where the various company’s registers (e.g. members, directors, charges etc.) and other documents are maintained.Paris Mavronichis & Co LLC can provide your company with a registered office address and business address as substance solution.

Procedure to Register a Cyprus Company

Receive notification of approval of the company’s name from the Cyprus Registrar of Companies.

  • Collect all required information and documentation.
  • Finalize necessary KYC procedures with our law firm.

Submit Forms HE 1, HE 2, HE 3, and the Memorandum and Articles of Association to the Registrar of Companies for review and approval.

  • Wait for the Registrar of Companies to examine all submitted documents.
  • Approval and official registration of the company may take 6 to 8 working days from the date of submission.

Receive a unique company registration number from the Registrar of Companies.

Obtain the following Company Certificates:

  • Certificate of Incorporation
  • Certificate of Directors and Secretary
  • Certificate of Shareholders
  • Certificate of Registered Office Address
  • Certified Memorandum and Articles of Association.

The Company Certificates can either be in the Greek or English language.  The Memorandum and Articles of Association can be translated via a court affidavit in English by the law firm.

Receive a company folder containing:

  • All aforementioned Company Certificates in original format
  • Share Certificate(s)
  • Official company stamp
  • Share transfer documents (if nominee shareholder services were requested)
  • Declaration of Trust – Trust Deed (where applicable)
  • Open-dated resignation letter signed by the nominee director (if nominee director services were requested)
  • Indemnity Letter signed by all beneficial owners and controlling persons.

Our Legal Services

Paris Mavronichis & Co LLC can assist you in every step of the procedure:

  • Provision of corporate legal advice and tax advice as to the most efficient Cyprus company structure (in collaboration with our trusted associates).
  • Company Formation Services – Preparation and submission of all forms and documents before the Cyprus Registrar of Companies for company name approval and registration of company.
  • Secretary Services – maintenance of statutory books of the company and the registers directors and members of the company, submission of forms and reports to Registrar of Companies, holding general meetings and keeping minutes of them and issuing notices.
  • Nominee and Fiduciary Services – provision of nominee directors and nominee shareholders and registered office address.
  • Substance Solutions Services – arrangement of office space for substance purposes
  • Bank Account Services – Opening and maintaining bank account for the Company and provision of bank signatory services.
  • Services provided via our business associates:
    • with respect to ongoing administrative functions of the companies (accounting, payroll and HR solutions)
    • Audit and Advisory services
    • Tax services: corporate, personal and indirect tax compliance and advisory

Please feel free to contact us if you have any question and to discuss how we can be of assistance to you.

DISCLAIMER:

PARIS MAVRONICHIS & CO LLC accept no duty of care or liability for any loss occasioned to any person acting or refraining from action as a result of any material in this publication.

The material contained herein is provided for informational purposes only and does not constitute legal advice nor is it a substitute for obtaining legal advice from an advocate.  Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced advocate. PARIS MAVRONICHIS & CO LLC will be glad to assist you in this respect.

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Paris Mavronichis & Co LLC is regulated by the Cyprus Bar Association
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