From Scrutiny To Certainty — Why International Businesses Can Trust Cyprus Again

The headline facts (what the data shows)

1. OECD peer-review: Cyprus participates in the Inclusive Framework and the OECD's 2023/2024 peer-review reports show broad implementation of the exchange-of-information transparency standards.
2. FATF / MONEYVAL: Follow-up reports (2022–2024) record measurable progress on AML/CFT since its 2019 evaluation, with strengthened frameworks.
3. Beneficial-owner transparency: Cyprus has a central UBO (beneficial ownership) register and updated AML law amendments in 2024 to enforce filing and verification.
4. EU blacklist context: The EU's non-cooperative jurisdictions list applies to third countries. As an EU member state implementing EU AML and tax-governance rules, Cyprus is not on this list.

What changed — concrete reforms and numbers

• Legal reforms: Cyprus transposed the EU's 5th AML Directive in 2021 and amended its AML law again in 2023–2024, with stronger enforcement and penalties.
• UBO register: The Registrar of Companies operates the ARIADNI e-portal, finalised in 2024, providing banks and regulators centralised access to ownership data.
• OECD peer reviews: The OECD's 2023/2024 reports show Cyprus active in tax transparency and exchange frameworks.
• AML follow-up reporting: FATF/MONEYVAL follow-ups show progress in supervision, enforcement, and banking standards.

Why investors and business owners can feel safe using Cyprus companies

Cyprus companies now operate in an environment aligned with EU and OECD norms, meaning investors can transact with confidence. The banking sector — once cautious due to heightened international scrutiny — has stabilised as AML and UBO reforms were implemented and independently reviewed, reducing the risk of unexpected account closures or compliance blockages. Cross-border payments flow smoothly under EU rules, and businesses benefit from harmonised standards that prevent arbitrary treatment by overseas tax or regulatory authorities. In practice, this means that using a Cyprus company for regional headquarters, trade, investment holding, or IP management provides operational ease without the reputational or compliance concerns often associated with offshore jurisdictions.

Why international investors continue to choose Cyprus

Beyond compliance, Cyprus offers a unique blend of advantages that attract investors worldwide. It maintains one of the most competitive corporate tax rates in the EU at 12.5%, combined with an extensive double-tax treaty network. English common-law foundations ensure a familiar and reliable legal system for contracts, dispute resolution, and corporate governance. The island's strategic location — bridging Europe, the Middle East, and Africa — makes it ideal for regional hubs. Add to this a highly educated workforce, robust professional services sector, and modern corporate infrastructure, and it becomes clear why thousands of international investors, from shipping and fintech to energy and real estate, continue to base their operations in Cyprus.

What this means for your business (practical implications)

• Lower risk — Cyprus is no longer seen as opaque; it follows EU/OECD norms.
• Easier banking — Reforms help speed up KYC and payment processes.
• Tax certainty — Participation in OECD exchange frameworks reduces cross-border tax risk.

Usefull information

• Cyprus as a financial centre
• Cyprus double tax treaty network
• Cyprus company formation requirements
• Watch Educational Videos on Youtube

Frequently Asked Questions (FAQs)

1. When did Cyprus exit international blacklists?
Cyprus, as an EU member state, is not on the EU list of non-cooperative jurisdictions and has addressed OECD and MONEYVAL recommendations between 2019–2024.

2. Is Cyprus fully compliant with OECD standards?
Yes. Cyprus participates in the OECD Inclusive Framework and its peer-review reports confirm implementation of tax transparency and exchange-of-information rules.

3. What is MONEYVAL's position on Cyprus?
MONEYVAL follow-up reports (2022–2024) note measurable progress in AML/CTF supervision and enforcement.

4. Should I be worried transacting with Cyprus entities?
No. With a functioning UBO register, updated AML laws, and EU supervision, Cyprus companies are safe and trusted for cross-border dealings.

5. Are there concerns setting up a Cyprus company for EU trade?
No. As an EU member, Cyprus companies enjoy full EU market access under harmonised rules.

6. Can Cyprus companies operate outside the EU?
Yes. Cyprus's double-tax treaty network and compliance with OECD standards facilitate global trade.

7. How strong is Cyprus's banking sector now?
Following reforms and EU supervision, the banking sector is stable and aligned with international AML standards.

8. What is the corporate tax rate in Cyprus?
Cyprus maintains one of the EU's lowest corporate tax rates at 12.5%.

9. Does Cyprus have a beneficial ownership register?
Yes. A central UBO register is fully operational via the ARIADNI portal.

10. Do international authorities still scrutinise Cyprus companies?
Cyprus is no longer viewed as an opaque jurisdiction; EU/OECD compliance reduces negative scrutiny.

11. Are Cyprus companies accepted by global banks?
Yes. Banks recognise Cyprus's reforms, and accounts are opened subject to standard KYC.

12. How easy is it to set up a Cyprus company?
The process is streamlined, with company registration and UBO filing done digitally.

13. Does Cyprus exchange tax information internationally?
Yes. Cyprus participates in OECD's automatic exchange of information and BEPS frameworks.

14. Are there risks of reputational damage when using Cyprus structures?
No. Cyprus has shed its "tax haven" image through compliance and transparency reforms.

15. What about FATF recommendations?
Cyprus aligns its AML framework with FATF standards, as confirmed in follow-up reports.

16. Is the Cyprus legal system reliable?
Yes. Based on English common law, Cyprus offers familiar and robust legal protections.

17. What sectors use Cyprus companies most?
Shipping, fintech, investment funds, real estate, and regional holding companies.

18. Does Cyprus have double-tax treaties?
Yes. Cyprus has 60+ treaties reducing withholding taxes and facilitating cross-border planning.

19. Can I hold intellectual property in Cyprus?
Yes. Cyprus's IP regime is EU-compliant and tax-efficient, widely used by international groups.

20. What practical steps should I take before transacting?
Request UBO extracts, AML compliance confirmations, and consult a licensed Cyprus accountant to ensure smooth operations.

About CYAUSE Audit Services Ltd

CYAUSE Audit Services Ltd is a leading Cyprus-based Audit & Assurance firm, ranked among the top 30 local firms and regulated by the Institute of Chartered Accountants in England and Wales (ICAEW). We assist corporations, investment firms, funds, and high-net-worth individuals (HNWIs) with visa planning, corporate structuring, and relocation to Cyprus, while ensuring compliance with international standards.

With offices in Cyprus and the UAE, our firm has been recognized by ICPAC and ACCA for the quality of our audit services and office procedures.

As a truly international practice, we collaborate with trusted associates worldwide and operate globally through Accace Circle, a co-created business community of BPO providers and advisors. Today, our network spans nearly 40 jurisdictions, employs 2,000+ professionals, and supports over 10,000 clients, including mid-sized businesses and Fortune 500 companies.

CYAUSE Audit Services Ltd is also a proud member of BKR International, a Top 10 global accounting association with over 150 independent member firms in more than 500 offices across 80+ countries, providing our clients with access to worldwide expertise and local knowledge wherever they do business. Additionally, we are part of the 3E Accounting Network, an international alliance of firms with a strong presence across Asia, Europe, and beyond.

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.