Cyprus: Re-Domiciliation Of Companies To And From Cyprus

Last Updated: 21 November 2016
Article by Antonis Paschalides

What is Re-domiciliation?

Stipulated in the Cypriot Companies Law Cap 113, 124(I) of 2006 it practically enables:

  1. Foreign companies to transfer their registered office from their home jurisdiction to Cyprus
  2. Cypriot companies to transfer their registered office to foreign jurisdictions.

General benefits of Re-domiciliation:

  • The companies Cypriot or foreign continue to maintain their legal identity even after their transfer to a foreign country or Cyprus respectively.
  • It is a less complicated procedure, no need to start the formation of the company elsewhere from scratch.
  • The foreign companies become tax residents of Cyprus for corporate purposes and may benefit from Cypriot favourable taxation without much of a burden.

Benefits of Re-domiciling your company to Cyprus:

Re-domiciling your company to Cyprus is a process that combines a low financial cost and a simple procedure , offers numerous advantages:

  • Obtaining tax residency in Cyprus, companies are able to obtain the benefits of the domestic tax system
  • Cyprus has one of the lowest corporate tax rates (12.5%).
  • Cyprus is part of an extensive double tax treaties circle.
  • The following are exempt from corporate income tax in Cyprus: (i.) Dividend income. (ii.)Interest income (iii.)Profits from a permanent establishment maintained outside Cyprus
  • Deducted from taxable income are all expenses incurred wholly for the production of income i.e. Interest incurred for the acquisition of a fixed asset.
  • Royalties received by a connected company registered in a European Union Member State are exempt from tax.
  • The Cypriot legal system falls under the umbrella of the protection and advantages of common European Union legislation as Directives and Regulations.
  • The Cypriot legal system is based on the Anglo-Saxon legal system Steps/Procedure:

Foreign company to Cyprus

1.The Memorandum of the foreign company must enable it to continue under the legal regime of another approved country. 2.Shall apply to the Registrar in order to be registered as a company continuing in Cyprus pursuant to the provisions of the Cypriot Law;

  • Sworn affidavit to be accompanied by receipt of such notification.

  • That no criminal or administrative proceedings have commenced against overseas company for contravention of the laws of its country of incorporation.

3.Its application should include the following:

Authorising resolution allowing the registration in Cyprus, List of directors/secretaries or administrative body of the foreign company, list of members, affidavit confirming its solvency, name/date/jurisdiction of the overseas company

4.The Registrar shall satisfy himself that the correct procedure was followed in accordance with Cypriot Laws and the consent of such proportion of the company's shareholders/employees/debenture holders/creditors of the company according to Cypriot Law. Temporary Certificate will be then obtained by the Registrar. It confirms the continuation of the Company's legal entity in Cyprus, on the condition that name under which the overseas will continue its activities will be altered in such a way that it avoids confusion or becomes misleading. Within a period of Six (6) months from the date of the issue by the Registrar of the temporary certificate of continuation, the overseas company shall submit evidence to the Registrar from the competent authority of the country or jurisdiction of its incorporation, that it has ceased to be a company registered in the country that it was originally incorporated. The Board of Directors will authorise the continuation of the company under the different legal jurisdiction and the Registrar shall issue a Certificate of Continuation confirming that the company continues in Cyprus. The Registrar old Companies in Cyprus shall keep a register of all names of companies and their details that received his consent to be registered as continuing in another approved country or jurisdiction.

Grounds for Rejection Rejecting an application of a foreign company to be registered in Cyprus if:

  1. Dissolution or liquidation of the overseas company has started or the proceedings of insolvency or an arrangement or composition or proceedings of execution of court orders or other analogous proceedings have been initiated from or against the overseas company;
  2. Liquidator or special administrator of the overseas company or receiver of its property has been appointed;
  3. Decision or order with which the creditors' rights are suspended or limited; or
  4. Proceedings that have commenced against it for the contravention of the laws of the country or the jurisdiction of its incorporation

Invalidity may follow registration if:

The re-domiciliation took effect in order to create a new legal entity, to cause loss or to affect the continuation of the company as a body corporate, to prevent legal/other proceeding that have commenced against it, to prevent any order/conviction/decision against it.

Cyprus company to a foreign country

  1. Provided that this is permitted by the Cypriot Laws or the Law of the foreign jurisdiction
  2. The Registrar of Companies must have granted its consent in advance.
  3. Will have to submit an application to the competent authority of the foreign country wishing to move its seat.
  4. State the intention to continue under the legal regime of that country jurisdiction.
  5. For the consent of the Registrar to be granted in relation to the continuation of the company in another country or jurisdiction the following requirements must exist:

A. - An approved shareholders' special resolution of the company according to the memorandum and articles of the company authorizing the said application - The company shall deliver to the Registrar for submission a declaration of solvency of the company by the directors, or any circumstances negatively affecting its solvency within a period of three years. - In case that the company is a public company, and its shares have been listed on a recognized stock exchange, the company must have submitted to the Registrar the consent of the said stock exchange and of the Cyprus Stock Exchange Commission, - The company has submitted all the fees and has completed all the proceedings relating to the company's business, according to this Law - Relevant fee submitted by the company regarding its application for the registrar's consent - No proceedings for the liquidation of the company have been initiated nor, any insolvency proceedings, arrangements or compositions, or proceedings for execution of court orders or any other analogous proceedings have been initiated by or against the company, in Cyprus or elsewhere. - At the time of filing the application for the Registrar's consent, the company has not contravened any legal duties or obligations. - The company must have submitted the total of the taxes and duties that are due or that will become due until the date of submission of the application.

AND B.In addition to the requirements above, in order for the Registrar to give its consent for the continuation of the company in another approved country or jurisdiction, three months have passed from the publication of a notice in two daily newspapers of wide circulation in the Cyprus.

6.If any creditor of the company objects to the transfer of the company's seat to another jurisdiction/ country, must explain sufficiently as to why, the court may then order the following: its continuation, that it should not continue, prohibit its continuation or approve it on the basis of sufficient guarantees.

End Result: The Certificate of continuation of the Cyprus company to the foreign another country shall be delivered to the Registrar of Companies. This signifies the company's halt as registered company in Cyprus from the date that its re-domiciliation to the other approved country or jurisdiction takes effect. The Registrar then strikes-off the name of the company from the register and issues a certificate of striking off.

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 Mondaq.com.

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

Authors
 
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”

Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
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
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). 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 & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd 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 or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.