Cyprus' strategic geographic location, excellent commercial infrastructure, political stability, favourable tax incentives and European-level standard of living are among the factors which have contributed towards the development of the island as an important financial centre.

The encouragement of foreign participation in the island's economy is a policy which is strongly endorsed by all official bodies and authorities as well as by the Cypriot people themselves. This open and liberal approach has successfully generated a growing awareness among foreign corporations and individuals of the unique advantages of using Cyprus as a business base.

The fact that Cyprus today is a booming regional financial centre is also due in no small part to the island's system of administration and its European tradition. To a large extent these were inherited from the British who controlled Cyprus before it became an independent sovereign republic in 1960.

The Turkish invasion of 1974, which left some 37% of the northern part of the island under Turkish occupation, did little to interrupt the unparalleled period of growth, prosperity and commercial expansion which followed independence. However, due to the authorities' expansionary economic policy and the initiative and enterprising spirit of the private sector, social and political security continue to form the cornerstone of Cypriot society. Indeed, although the Cyprus problem has not yet been solved, the rule of law and political stability in the Republic of Cyprus are guaranteed by the efficient functioning of democratic institutions and by dynamic economic development.

Today the authorities are demonstrating more clearly than ever before that they are seriously committed to refining and expanding the legislation and regulations in terms of which foreign involvement in the island's economy is secured. Therefore, an extremely favourable environment for all forms of inward business activity and international foreign investment has been created to ensure that they enjoy an infrastructure which has the maximum potential for success and growth.

The purpose of this publication is to assist clients and associates in clarifying and appreciating the range of opportunities which are available in or through Cyprus. Although every effort has been made to provide the reader with a clear and comprehensive picture of the island's beneficial regime, it should be appreciated that is not possible to cover all aspects comprehensively in a publication of this size.

Individuals or companies who are seriously considering using Cyprus for any of their international business activities are advised to obtain expert professional advice before taking positive action.