Cyprus Company Formation
Introduction to Registering a company in Cyprus
Cyprus company formation remains a dream destination for many foreign investors by offering an efficient and sophisticated business environment, coupled with a corporate tax rate of just 12.5%. Located south of Turkey in the north-eastern part of the Mediterranean Sea, Cyprus is the largest island in the eastern Mediterranean. Despite joining the EU as de facto divided island, the whole of Cyprus is considered EU territory.
Company Incorporation Cyprus is an attractive option, as the island has double-taxation treaties with over 60 other countries, including most of the high-tax countries in Western Europe, and many states in Central and Eastern Europe. As a low-tax centre, this makes Cyprus a particularly effective location for companies aimed at emerging markets. On top of this, the economy is strong and stable, and business costs are generally low. Since 2008 Cyprus adopted the Euro as its national currency, replacing the Cypriot pound.
Due to its favorable tax regime, Cyprus is the gateway to the European common market chosen by many non-EU companies and a portal for investment from the West into Russia, Middle-east, Asia and US. It is also a shipping hub, the Cypriot-registered vessel fleet is the fourth largest in the world, and provides large revenues. Cyprus is an exporter of produce, clothing and pharmaceuticals.
What are the main types of Cyprus Company Formation?
There are 3 types of company types commonly used;
- Private Limited company
What are the main features of a Private Limited company?
- no minimum share capital requirement
- number of shareholders must be between one and fifty
- company must have at least one director and one secretary
- Registered office required
What are the main features of a Branch?
- foreign parent responsible for all liabilities of Cypriot branch
- branch required to register with Registrar of Companies
What are the main features of a Limited liability Partnership?
- general partnership: between two and twenty members
- limited partnership: at least one partner with unlimited liability
- required to register with Registrar of Companies
Benefits of Cyprus Company Formation
Cyprus company formation offers several benefits including:
- Low Corporate Tax: Cyprus has a low corporation tax at 12.5% rate.
- One Shareholder: the minimum requirement is only one shareholder to incorporate along with one director where either or both can be any nationality and reside anywhere in the world.
- Ideal for Holding Company: Cyprus is well known where taxes are beneficial for holding companies allowing for greater freedom
- EU Membership: Having been a member of the EU since 2004, give Cyprus credibility as a safe place to incorporate.
How can I get more information on Cyprus Company Formation?
Cyprus offers benefits to its companies including; as a former British colony English Common Law System is used and English is its second official language and easy to open corporate bank accounts. Our experts in Euro Company Formations makes it easy for you to open a company in Cyprus and ensure your business gets off to the quickest and most cost-effective start.
Formation of Companies in the Turkish
Republic of Nothern Cyprus
The Turkish Republic of Northern Cyprus (TRNC) has been offering new opportunities for investors within its constantly developing economic envionment.The major goal of the local and foreign investors is to estabish a corporate body in the TRNC.The industry in which the intended company will operate determines under which law the company will be established.The fundamental law for the formation of companies in the TRNC is Companies Law Cap 113.Companies Law determines the formation and operations of the companies as well as their organs and their authorities and responsibilities.
Companies which are established in the TRNC are subject to different tax treatment based on their nature of activities.The rules for the establishment and operation of companies which are subject to different tax treatment are stated in the laws which are in force in addition to Companies Law.
One of the major decisions to be taken by the investors is to get reliable professional sevices.Investos should not look into establishment of a company as a sole legal issue.In addition to establishing a company by registration, investors has to know the tax implications that companies may face.Getting tax advice at an early stage ensures the success of a profitable investment.
Closer Partners has great knowledge of the Companies Law Cap 113 and has developed enermous experience in the establisment of companies.We have been providing consultancy to many local and international companies on the matters involving Companies
Law and Tax Laws for many years.Many internationally well known companies have been our clients receiving reliable and professional advice on accounting , tax and legal issues.
Our firm’s staff are specialists of Companies Law as well as tax and accounting issues tackling the big challenges they face and drawing our xperiences across the goverment , multinational companies, local companies and privately owned businesses and enterprises.
Real and corporate bodies can establish businesses in their name as a legal corporate body in the Turkish Republic of Northern Cyprus (TRNC).Legal status of enterprises are determined by the laws in the TRNC.
There are different laws in the TRNC which regulate the legal structure and activities of the enterprises.The fundamental law is the companies Law Cap 113.
The following are the laws which regulate the legal structure and activities of the enterprises.
– TRNC Companies Law Cap 113
– Partnership and Trade Names Law
– Foreign Investment Law
– TRNC Banking Law
– International Banking Units Law
– Freezone Law
– International Business Companies Law
– Insurance Law
In addition to the fundamental law,which is Companies Law Cap 113, there are laws which regulate the establishment and functioning of enterprises operating in different industries.Although the establishment of banking and ınsurance companies are performed under Companies Act, the licences and functions of these type of companies are regulated by Banking Law and Insurance Services Law.
In addition to different laws for different industries , there are laws which provide preferential tax treatment to companies and establish the rules for their formation and operations.Companies which operate in the Free Zone and the Companies whose activities are wholly outside the TRNC, are incorporated under Free Zone Law and International Business Companies Law.The licences and functions of these companies are governed by these laws.
Enterprises which can be established in the TRNC are the following:
- Sole Traders
- Local Limited Liability Companies
- Branches of Foreign Limited Companies
- Free Zone Companies
- International Business Companies
Amongst the Local Limited Liability Companies the following are incorporated under special laws.
b. International Banking Units
c. Insurance Services Companies
The Basic Conditions the Formation of Companies
Even though the companies activities are regulated by different laws, they are all bound by the fundamental sections of the TRNC Companies Law.All the companies established in the TRNC (except the Branches of Foreign Limited Companies) must fulfill the following conditions:
- Companies must have at least 2 (two) shareholders.
- Companies must have at least 1 (one) director.
- Companies must have 1 (one) company secretary.Secretary in the Companies Law is the person who submits official documents of the company.
- Companies must have a registered adress in the TRNC.
These conditions are applicable to all types of companies irrespective of the law which regulate their activities.