Cyprus: M&A Opportunities In Cyprus Post-Brexit

Last Updated: 7 March 2019
Article by Nikoleta Christofidi

Cyprus has reclaimed its status as a country with a developed and well-trusted economy, having overcome the challenges of recent years with a gross domestic product growth of 3.9% in 2018. There has been a noticeable rise in foreign investments in the local market, with an upswing in mergers, acquisitions and joint ventures. This has been the result of various reforms and legislative amendments that have added legal certainty and contributed to the creation of a coherent statutory framework.

Legal framework

Mergers and acquisitions in Cyprus are governed by a number of legislative instruments. The main laws are:

  • the Companies' Law, Cap 113, as amended (the Companies Law); and
  • the Public Takeover Bids for the Acquisition of Securities of Companies and Related Matters Law (41(I)/2007), as amended (the Takeover Law).

The Companies Law regulates the merger and restructuring of private Cyprus companies and the merger and division of public companies. Following the repeal of the EU Cross-Border Mergers of Limited Liability Companies Directive (2005/56/EC) by EU Directive 2017/1132/EC, cross-border mergers of limited liability companies within the European Union are governed by Chapter II of the 2017 directive, which has a direct effect in Cyprus. EU Directive 2017/1132/EC allows for the merger of limited liability companies incorporated in accordance with the legislation of an EU member state that have their registered office, central administration or principal place of business in the European Union, provided that at least two of said companies are governed by the laws of different EU member states, without any adverse tax consequences.

By implementing the EU Takeover Directive (2004/25/EC) into domestic legislation, the Takeover Law regulates public company takeover bids where:

  • the target's registered office is in Cyprus and its securities are traded on a Cyprus-regulated market; and
  • the target's securities are not admitted to trading on a regulated market in the EU member state in which the target has its registered office, provided that certain conditions are met.

The Takeover Law also gives the Cyprus Securities and Exchange Commission authority to issue subsidiary legislation for further regulating such bids.

While less prominent, the following laws are still important and must be considered in M&A transactions:

  • the Cyprus Securities and Stock Exchange Law (14(I)/1993), as amended, which provides for public mergers and acquisitions;
  • the Transparency Requirements (Securities Admitted to Trading on a Regulated Market) Law (190(I)/2007), as amended;
  • the Market Abuse Law (102(I)/2016), which implements the EU Market Abuse Regulation (596/2014) into domestic legislation;
  • the Control of Concentrations between Undertakings Law (83(I)/2014), which regulates concentrations between undertakings and notification to and clearance by the Commission for the Protection of Competition;
  • the Preservation and Safeguarding of Employees' Rights on the Transfer of Business, Facilities or Parts of Business or Facilities Law (104(I)/2000), as amended, which protects employee rights on transfer of a business;
  • the Business of Credit Institutions Law (66(I)/1997), as amended, which governs acquisitions in the banking sector, in conjunction with subsidiary legislation issued by the Central Bank of Cyprus; and
  • the Income Tax Law (118(I)/2002), as amended.

M&A activity

Some of the most notable recent M&A cases include:

  • Hellenic Bank of Cyprus's takeover of the healthy part of the Cyprus Cooperative Bank;
  • Monaco Telecom's acquisition of 100% of MTN Cyprus for €260 million;
  • British Galileo Global Education's acquisition of three Laureate Education Inc owned schools (including the European University of Cyprus) in a deal worth €225 million;
  • Iron Mountain Incorporated's acquisition of Fileminders Ltd, a global leader in enterprise information management services;
  • Leading Maltese quad play telecoms company GO PLC's acquisition of 25% of Cablenet Communications Systems Limited for €12 million; and
  • the acquisition of Piraeus Bank by a group of Lebanese investors led by Holding M. Sehnaoui SAL, which then led to the creation of AstroBank.

Many international M&A agreements involving Cyprus entities are governed by English law and in this context, a memorandum of understanding has been agreed between the European Securities and Markets Authority and European securities regulators with the UK Financial Conduct Authority. The aim is to ensure investor protection, orderly markets, financial stability in the European Union and the continuation of certain activities carried out by UK-based entities on behalf of counterparties based in the European Economic Area, such as fund manager outsourcing and delegation, even in the event of a no-deal Brexit.

Potential impact of Brexit

Cyprus's legal framework has always been particularly accommodating to English law-governed agreements since Cyprus is a common law jurisdiction. In addition, pursuant to Cap 10 of the Foreign Judgments (Reciprocal Enforcement) Law 1935, as amended, judgments obtained in the United Kingdom, British dominions, protectorates and mandated territories, as well as in foreign countries that accord reciprocal treatment to judgments given in Cyprus, are capable of being registered and enforced in Cyprus. Therefore, Cyprus is expected to continue to maintain close ties with the United Kingdom even in the event of a no-deal Brexit.

Further, the following factors suggest more M&A opportunities will arise in Cyprus in the near future:

  • Cyprus's comprehensive and coherent legal framework;
  • the fact that Cyprus is an EU member state with a strong fiscal performance;
  • new large-scale projects, including property developments and golf resorts;
  • the growing renewable energy sector; and
  • the establishment of new casinos.

In addition, the uniform 12.5% corporate tax rate, numerous double tax treaties and the fact that reorganisations that take place in Cyprus may be exempted from taxation, underline Cyprus's favourable legal framework in terms of taxation. It is therefore not implausible to suggest that international investors might well consider these factors when assessing Cyprus as an attractive investment hub for future transactions in the M&A market in the post-Brexit era.

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.

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
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please 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