Cyprus Companies

REGISTRATION PROCEDURE

 A company can be registered with the Registrar of the Companies as follows:

a) Approval of the name of the company by the Registrar of the Companies,

b) Preparation of memorandum and articles of association of the Company in Greek and English,

c) Filing with the Registrar of Companies the Memorandum and Articles of Association of the Company in Greek duly signed by the subscribers together with prescribed forms giving details of the registered address of the company and the appointment of the first directors and secretary.

ANNUAL REPORTING CONDITIONS

 1. Obligation to maintain accounting records and prepare audited financial statements:

The directors are obliged to ensure that the company maintains accounting records which enable the preparation of financial statements that present a true and fair view of the company’s financial position and performance in accordance with International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS). The law also requires certain disclosures and prescribes information that must be provided in the director’s report. The audited financial statements are required to be filed with the Registrar of Companies within 12 months of the financial year end.

The accounting records must be held either at the registered office or at another place in Cyprus and must always be available for inspection by the directors. Even if the book keeping function is maintained outside Cyprus, arrangements should be made for the accounting records to be sent to Cyprus at regular intervals, no exceeding 6 months.

2. Submission of annual returns at the Registrar of the Companies.

3. Payment of Registrar annual fee.

INFORMATION NEEDED FOR THE REGISTRATION

1. Name of the proposed company

The Registrar is likely not to accept a name that is identical or similar to an existing company name. The following words or their derivatives are restricted: Asset Management, Asset Manager, Assurance, Bank, Banking, Broker, Brokerage, Capital, Credit, Currency, Custodian, Custody, Dealer, Dealing, Deposit, Exchange, Fiduciary, Finance, Financial, Fund, Future, Loan, Lender, Option, Pension, Portfolio, Reserves, Savings, Security, Stock, Trust or Trustees. The suffix Limited or LTD must be included.  It is advisable to submit for approval two or three alternatives to the first choice of name.

2. Corporate features of your future company

The following information is required for the registration of a Limited Company in Cyprus:

>Main activities of the company.
>Authorized share capital.
>Directors: Minimum of one director is required. It can be natural or legal person. There is no necessity to have local director although in most cases it is advisable. For the company to qualify as Cyprus tax resident the management and control must be in Cyprus. Therefore, if the majority of directors are permanent residents of Cyprus, then this is the strong evidence to assume that the management and control are taking place in Cyprus.
>Secretary: The secretary of the company is responsible for ensuring that the company complies with Company Law requirements. For this purpose it is advisable to appoint local secretary.
>Shareholders: There must be at least one shareholder who can be either an individual or a company. Should anonymity be required, trustee companies in Cyprus can hold the share in trust for the beneficial owner.6. Registered office: The address of the registered office should be given.  This is the place where a writ, summonses, notices, orders and other official documents can be served upon the company.

Transcapital Business Consulting Ltd can register the new company of your choice within 7-10 working days while a shelf Company can be delivered the same day.

CYPRUS LEGAL ENTITIES

International enterprises are businesses registered in Cyprus and whose business activities are outside Cyprus. These International enterprises enjoy special taxation privileges. Also it is important to note the following with regard these International companies:

1. All their shareholders must be aliens; and

2. All their profits or income must be derive from business activities outside Cyprus.

(A) Private Limited Liability Companies

>Distinct legal entity with a separate personality from its owners
>The liability of owners is limited by the amount of capital they possess within the entity
>Minimum 1 director, 1 shareholder and 1 secretary are required. According to the law there is a possibility to be the same person, legal or natural

(B) Branches

>A branch does not constitute a legal entity different from that of its founding overseas company and liability remains with the foreign entity
>For accounting purposes is being treated as a separate entity and must account for the profits on a similar basis as limited liability companies
>There are two types of branches: local branch of a foreign company and branch of a local company
>Overseas companies may establish a branch in Cyprus by registering it with the Registrar. They must also file the company’s memorandum of association, directors and details of the local representative that is authorised to accept service in Cyprus.

(C) General/Limited Partnership

>In general Partnerships liability remains with the owners/partners and it is unlimited
>Limited Partnerships usually limit the liability of certain partners
>The partners can be legal entities
>Relationship of partners and management of partnership is regulated by the partnership agreement or if no agreement, by the Law

(D) European Company (SE)

>Council regulation No. 2157/2001
>The advent of the SE means that companies established in more than one Member state can now merge and operate throughout the EU on the basis of a single set of rules and a unified management and reporting system
>The formation of an SE is governed by the law applicable in the member state where the SE establishes its registered office and shall enjoy legal personality upon its filing within the domestic Registrar of Companies.
>An SE is a separate legal entity and the liability of the shareholders of an SE is limited to the respective subscribed share capital of each
>An SE may be formed by merger or consolidation, by forming a holding company, by forming a subsidiary and by reorganization
>Annual accounts and corporate taxation: an SE shall be governed by the rules pertaining to the preparation and submission of accounts and to tax treatment as are applicable to public limited liability companies in the member state in which the registered office of the SE is located.
 

 (E) Cyprus Public Companies

>A public company may offer its shares to the public;

>A public company must have at least two directors;

>A public company may restrict the right to transfer its shares if its articles so permit (e.g. directors may decline to accept a transfer of unpaid shares);
>There cannot be any restriction on the right to transfer the shares of public companies whose shares are listed on a stock exchange;
>There is no maximum number of shareholders in a public company and the minimum number of shareholders in a public company is seven;
>A public company, can buy-back its own shares subject to the limitations as specified by the Companies’ Law;
>A public company must file a statement in lieu of a prospectus before the first allotment of its shares in case a prospectus was not issued;

>A public company is prohibited to make loans to its directors;
>A public company may not issue shares at a discount;
>A public company cannot distribute dividends to its shareholders if its net assets, as shown in the last annual financial statements or its net assets could result that after the distribution of dividends, are less than the sum of the issued capital and its reserves;
>A public company may distribute interim dividends only if interim financial statements are prepared which show that there are available funds for such distribution.

Registration procedure

A public company can be registered in Cyprus either from scratch or by converting an already registered private company into a public company.

Share Capital

The minimum issued capital of the Cyprus public company must be €25.630,00 (twenty five thousand six hundred and thirty Euros). In effect, the minimum offered and paid up capital for subscription must not be less than €25.630,00.

A public company shall not be able to commence any business or take out any loans or undertake any relevant obligations unless the Registrar of Companies delivers to it, in advance, a certificate certifying that the nominal value of the company’s subscribed capital is equal to at least the minimum capital mentioned above i.e. €25.630,00.

It is compulsory to have available the above mentioned capital at the moment when the Registrar of Companies is requested to issue the certificate certifying that the nominal value of the company’s subscribed capital is equal to at least the above mentioned minimum capital.

Shareholders

A Cyprus public company must have a minimum of seven shareholders.

Director

A Cyprus public company must have a minimum of two directors.