Cyprus: Cyprus Chapter Of Digest Of Commercial Laws Of The World


§ 11:1 Description of system of law

The modern law of the Republic of Cyprus has its origins in a wide variety of different legal systems reflecting the island's turbulent historical past prior to its gaining independence in 1960.

When the Franks conquered Cyprus in 1192, they brought with them a feudal system of law which was not codified but based on custom. The Franks discovered that a system of law already existed on the island and this was based on Greco-Roman customary law which had been developed by the Byzantine Emperor Justinian. The Franks adopted the existing law into their own feudal laws and developed a system of laws called Assizes.

The Ottoman Turks, who conquered the island in the late 16th century, brought with them the Ottoman Laws and, in particular, the Ottoman Penal Code, Civil Code and Land Code which covered most of the land and penal laws. Family matters were dealt with by Islamic law with respect to the Muslim population of the island while the ecclesiastical courts of the Greek Orthodox Church had supreme authority over the Christian Greek population of the island.

The British, who effectively controlled Cyprus from the late 19th century, introduced English law to the island and, in particular, common law rules and principles and rules of equity, as well as a number of statutes which were in force in England at the time.

When Cyprus became independent in 1960, the Constitution of the new Republic provided that the laws previously applicable should remain in force until repealed or amended by new laws of the Republic. Since independence, myriad laws have been enacted, but the common law still plays an important part in the administration of justice on the island, in particular in relation to commercial matters.

Under Article 1 of the Constitution of Cyprus, the new state is an independent and sovereign republic, with a presidential system of government. Although not explicitly stated, the Constitution adheres to a relatively rigorous separation of powers with respect to the authority of the executive, legislative, and judicial branches of government.

§ 11:2 Constitutional law

The Constitution of the Republic of Cyprus is the product of the London and Zurich Agreements. In order to grant independence to Cyprus from British colonial rule, on 11 February 1959, representatives from Greece and Turkey met in Zurich and reached an agreement for the granting of independence and self-determination to the people of Cyprus. On 19 February 1959, the Prime Ministers of the Hellenic Republic, the Turkish Republic, the United Kingdom of Great Britain and Northern Ireland and the leaders of the Greek-Cypriot and Turkish-Cypriot communities initialed the documents comprising the Zurich agreement.

On the basis of the above Agreements, a constitutional commission was appointed to draft the Constitution of Cyprus, composed of representatives of the two communities and of the Greek and Turkish governments. The outcome was the declaration of an independent Cyprus Republic on 16 August 1960 and the creation of a constitution which embodied the various provisions of the Zurich Agreement, certain aspects of the 1950 Greek Constitution and most of the provisions of the European Convention on Human Rights with respect to fundamental rights and civil liberties.

The Constitution of Cyprus cannot be said to be a true reflection of the sovereign will of the people of Cyprus. It is rather a "granted" constitution and the product of negotiation and compromise between the previous colonial ruler and the governments of the two "motherlands" of the two resident ethnic communities.

The Constitution of Cyprus is also a "rigid" constitution because a number of basic articles are considered to be of fundamental importance and cannot be deleted or amended under any circumstances by the unicameral legislature. Amendments to the remaining articles require a two-thirds majority from representatives of both communities in the House of Representatives.

The Constitution does not fully respect the democratic principle of majority rule since it effectively gives the minority Turkish-Cypriot community and the majority Greek-Cypriot community equal rights, despite the disparity in their numbers. The Turkish-Cypriot com- munity is overrepresented in all the organs of central government with respect to its demographic weight. In a number of matters, such as defense and the budget, it has an effective veto which may be exercised by the Vice-President of the Republic, who must be a member of the Turkish-Cypriot community.

Following the invasion of Cyprus by the armed forces of Turkey in 1974 and the occupation of the northern part of the island by the Turks, which continues to the present day, the Constitution of the Republic of Cyprus is only enforced "de facto" in the southern free part of the Republic. The partition of the island led to the forced separation of the two communities into two ethnically cleansed regions, a "Turkish" north and a "Greek" south. The partition of the island has meant that many provisions of the Constitution which require the participation of members of the Turkish Cypriot community cannot be enforced in the free territory of the Republic.

The accession of the Republic of Cyprus to the European Union (EU) on 1 May 2004 and the ongoing accession negotiations between Turkey and the European Union may assist in the discovery of a lasting and peaceful settlement of the political problem on the island and in the eventual re-unification of Cyprus. A settlement will almost certainly necessitate the adoption of a new Constitution to replace the 1960 constitution.

§ 11:3 Statutory law

Under the Constitution, the legislative power of the Republic is exercised by the House of Representatives. All laws must be passed in the House of Representatives by a simple majority vote of all the members present. Laws passed by the legislature come into force on the date they are published in the Official Gazette of the Republic, unless other provision is made in the law itself.

Not all statutes are of equal force to each other. Statutes that are passed by the legislature in order to ratify an international treaty, convention or agreement concluded under a decision of the Council of Ministers (the organ vested by the Constitution with the exercise of executive power) have superior force over any other domestic law. However, the supreme law is the Constitution and all statutes and laws passed by the House of Representatives must be consistent with its provisions.


§ 11:4 Definition of trader

The term "trader" can generally be understood to indicate a person or entity that carries on some type of commercial business or enterprise. The nature of the business typically involves the sale of goods, the provision of services, or both. The term "trader" is not, however, commonly used or defined under Cyprus commercial law. By way of example, the Sale of Goods Laws 1994–1999 use the terms "buyer" and "seller" respectively to refer to a person who purchases or who agrees to purchase goods and a person who sells or who agrees to sell goods.

§ 11:5 Registration of traders

The type of business a trader carries out in the territory of the Republic of Cyprus determines the nature of the legal and regulatory framework under which the business will be conducted. Certain areas of business, such as banking and telecommunications, are extensively regulated. For example, any trader that wishes to conduct banking activities in Cyprus must first obtain a license from the Central Bank of Cyprus and meet certain requirements set out in the Banking Activities Law of 1997 as amended. Similarly, a trader who wishes to conduct activities in the telecommunications market should first consult the Office of the Commissioner of Electronic Communications and Postal Regulator to ascertain whether a license is required from the Regulator before commencing his business.

There are a number of registration requirements for different forms of business organization. The Registrar of Companies and Official Receiver is the government authority entrusted with the registration of all business entities (either foreign or domestic) that carry on business in the territory of Cyprus. For example, partnerships and corporations must register by _ling certain documents with the Registrar, which are accessible to the public, pertaining to, among other things, the entity's name, place of business, ownership and management. This information needs to be updated on a timely basis whenever changes occur. Sole traders or sole proprietors must have their business name approved and registered by the Registrar.

Traders may also be required to register with the local authority or municipality in which their place of business is situated. For example, all traders must be registered with and obtain a professional license from their respective municipality which is renewable annually. This is in effect a form of direct taxation and an important source of revenue for the local authorities.

Traders also must be registered, for tax purposes, with the Inland Revenue Department and the Value-Added Tax (VAT) Department of the Ministry of Finance. Specifically traders must pay on an annual basis corporation tax levied on their annual profits to the Inland Revenue Department. VAT, being a form of retail or sales tax, is charged by all traders with annual turnover in excess of ¬15,600 and included in the prices of the taxable goods and services provided by them. Traders must collect the VAT on the products or services they sell and then remit the money collected to the VAT Department. Furthermore, traders must pay social insurance for themselves and for their employees through payroll deductions to the Department of Social Insurance of the Ministry of Labor and Social Insurance.

§ 11:6 Other requirements of traders

There are a number of statutes and regulations that have been put in place for the purpose of consumer protection. For example, the Sale of Goods Laws of 1994–1999 implies a number of conditions in contracts for sale of goods, including conditions that the goods in question should be of an acceptable quality, should be fit for the purpose for which they are being purchased, should correspond to their sale description and that the buyer shall enjoy the goods free of any encumbrances with respect to title. Other important consumer protection laws include laws that deal with issues such as onerous terms in consumer contracts, timeshare leasing contracts, distance selling contracts and consumer credit contracts.

There are a number of laws and regulations of an industry specific nature designed to protect consumers from loss or unfair treatment (e.g. concerning the travel industry, the insurance industry, et cetera). There are also myriad other laws and regulations which impose certain minimum standards or requirements, in particular relating to foodstuffs and pharmaceutical products, as well as product labeling requirements. These laws and regulations are all in line with European norms and it is advisable to carefully research them before undertaking the sale or distribution of products in Cyprus.


§ 11:7 In general

Foreign trade and access to international markets are of the utmost importance to Cyprus due to the small size of its domestic market and the open nature of its economy. As a result, foreign trade has contributed significantly to the economic growth of the island. In 2014, the value of Cyprus's foreign trade was approximately EUR 6,588 million.

Cyprus's main imports are raw materials, consumer goods, transport equipment, capital goods, fuels and lubricants. More than 70% of these imports originate from the EU. Other significant trading partners include the Russian Federation, the United States, China, Japan, Taiwan, South Korea, Israel, and the neighboring Arab countries.

Cyprus's principal exports are manufactured goods and (processed or raw) agricultural products. Exports of manufactured goods include pharmaceuticals, clothing, cement, tobacco products, paper products, plastics, and furniture. Exports of agricultural products include cheese, wines, fruit and vegetable juices, citrus fruit and potatoes. The EU is the most important market for Cyprus's exports, accounting for 42% of total exports in 2014. Other important import markets are the Arab countries, countries of Eastern Europe, the Russian Federation, Israel, and the United States.

§ 11:8 Regulations and restrictions

The main body of legislation that currently deals with aspects of foreign trade is the Customs Code Law of 2004. Under the Law, the importation and exportation of certain goods is prohibited or restricted.

Restrictions usually refer to the need for securing permits or licenses or inspections from relevant government authorities. The aim of these restrictions and prohibitions is to safeguard social ethics, public order and security, public health, the health of animals and plant life and the island's cultural heritage. The following is a non-exhaustive list of items or goods whose importation is prohibited:

  1. Goods not bearing the mark "CE," where this is required;
  2. Narcotic drugs and other controlled substances;
  3. Obscene matters and objects (e.g. contained in DVDs, CDs, cassettes, films, publications, etc.);
  4. Flick-knives and double-edged knives;
  5. Counterfeit or pirated goods which infringe copyright and intellectual property rights;
  6. Nuclear, chemical, toxic and biological weapons and related substances;
  7. Counterfeit currency;
  8. Handguns and rifles, apart from those used for recreational purposes, explosive military devices and launchers, automatic guns, ammunition and other items described in Appendix 1 of the Firearms Law (Law 113(I) of 2004);
  9. Items used for illegal hunting and trapping of wild birds and prey; and
  10. Goods originating from countries under an embargo imposed by the United Nations Security Council or by the European Union.

The following is a non-exhaustive list of items or goods whose importation is restricted and requires a permit prior to their importation into Cyprus:

  1. Hunting rifles, air-rifles, sporting pistols, and archery accessories;
  2. Cinematograph films;
  3. Communications transceivers (other than walkie-talkies, mobile phones and pagers);
  4. Explosives and similar substances;
  5. Flowers and plants;
  6. Biocides;
  7. Gold bullion, gold and silver coins, uncut diamonds and precious metals;
  8. Handcuffs;
  9. Meat, fish, cheese and honey products; and/or
  10. Wild fauna and flora.

The following is a non-exhaustive list of items whose exportation is prohibited:

  1. All items whose importation is prohibited; and/or
  2. Items of military use mentioned in Defence (Exportation of Goods) Order of 1999.

The following items require an export license and therefore their exportation is restricted:

  1. Antiquities;
  2. Materials that may be used for the production of weapons of mass destruction; and
  3. Wild fauna or flora threatened with extinction.

§ 11:9 Taxation of foreign trade

As of 1 May 2004, the date on which the island joined the EU, Cyprus applies the EU's Common Customs Tariff on agricultural and industrial products originating from non-EU countries. Due to its accession to the EU, Cyprus has eliminated any remaining tariffs or quotas which may have applied to EU imports prior to accession.

The application of favorable preferential tariff measures on goods imported from third countries provided for in bilateral trade agreements between the EU and these countries depends on whether the prerequisites of the rules of origin that are provided for in these agreements or in the corresponding implementing provisions of the European Union's Customs Code are met. The non-preferential origin of goods is related to the application of the Common Customs Tariff and the application of EU trade policy measures.

To continue reading this article, please click here.

Previously published by Thomson Reuters

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Elias Neocleous & Co LLC
Elias Neocleous & Co LLC
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Elias Neocleous & Co LLC
Elias Neocleous & Co LLC
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions