The "Strategy for Attracting Businesses for Activities or/and Expansion of Their Activities in Cyprus" was approved by the Council of Ministers on 15 October 2021.
The Strategy is a critical initiative for attracting worldwide investment and talent. The previous investment strategy has been significantly revised, enlarged, and simplified to encompass a series of actions and changes in a variety of intervention areas, with the goal of strengthening Cyprus' position as an international high-growth business centre.
The meticulous planning assures that the benefits generated from the Strategy's effective execution will greatly contribute to reinventing Cyprus's growth model.
It is worth mentioning that all Companies registered as International Business Companies are obliged to employ Cypriots / EU citizens who make up 30% of their total staff over a period of five years. In five years’ time, ie after 2.1.2027, the ratio for new recruitments will be checked. If a company does not comply with the 70:30 ratio, the case will be evaluated based on its own criteria and will be brought before the management.
The Business Facilitation Unit (BFU) provides a variety of services to help firms establish themselves in Cyprus. Completing all registrations at the One-Stop Shop Section, approval of company name and registration, registration in the Employers' Register and Tax Register and assistance with essential permissions and licences are among the services provided. The BFU also reviews enterprises that want to hire foreign nationals and adds them to the Register of Companies with Foreign Interests. The BFU advises businesses on a variety of topics, including company strategy, licensing, market placement, and personnel recruitment.
Eligible businesses must meet the following criteria:
1. The majority of the company’s shares are owned by third-country nationals.
2. If the majority of the company’s shares are not owned by third-country nationals (i.e. equal to or less than 50%) then the company is eligible if the foreign participation represents an amount of at least €200.000.
In both cases above (1 & 2), the ultimate beneficial owner (UBO) must deposit an amount of €200,000 in an account held by the company in a credit institution licensed by the Central Bank (payment institutions are not included). Alternatively, the company can submit evidence of an investment amounting to €200,000, for the purposes of operating its business in Cyprus (e.g. office purchase, office equipment purchase, etc.).
If more UBOs exist, then this amount can be deposited or invested by a single UBO or collectively.
3. Public companies registered on any recognised stock exchange.
4. Companies with international activities (formerly offshore companies), which operated before the change of regime, the data of which are held by the Central Bank.
5. Cyprus shipping companies.
6. Cyprus high-tech/innovation companies
7. Cyprus pharmaceutical companies or Cypriot companies active in the fields of biogenetics and biotechnology.
8. Companies, the majority of the overall share capital of which is owned by persons who have acquired Cypriot citizenship by naturalisation based on economic criteria, provided that they prove that the conditions under which they were naturalised continue to be met.
The procedure to be followed under the Business Facilitation Unit is described as follows:
a) Businesses wishing to transfer their operations or expand their activities in Cyprus must express their interest by submitting a relevant request to the Business Facilitation Unit of the Ministry of Energy, Commerce and Industry by email. The email must be accompanied by a letter of expression of interest for the establishment or expansion of their activities in Cyprus. The letter of intent should include a brief description of the company, activities (nature of business as stated in the Articles of Association), number of staff, expansion plans, etc. The request supported by the necessary documents
b) The Unit will inform the investor in writing of the next steps and the documents that would have to be submitted in accordance with the services he/she wishes to utilise.
c) All the necessary registrations for the establishment of a Cyprus company will be completed within seven (7) working days from the date of submission of all the necessary documents to the Ministry of Energy, Commerce and Industry.
The confirmation of the registration of a Cyprus company in the Register of Companies with Foreign Interests will be effected by electronic means.