Formation of Companies

As from 1st October 2004, the Council of Ministers has approved the complete freedom of the policy governing direct investments from non-residents in Cyprus. Consequently, non-residents who wish to establish a Company in Cyprus or acquire shares in existing Cyprus companies

, or otherwise to invest in or from Cyprus, no longer require approval by the Central Bank of Cyprus. Such applications should now be addressed directly to the Department of Registrar of Companies and Official Receiver.

A company is recognized in law as a legal entity, separate from the persons who form the company and/or the directors and shareholders. It has a separate legal existence and is separate and distinct from its owners. Private Limited Companies are considered as one of the most easily managed and cost effective business structures.

Under the Cyprus Law the legal forms of Companies are as follows:

1. Company Limited by shares which is subdivided into:

(a) Public companies and

(b) Private companies which are also subdivided into:

i.Exempt Private Company

ii Limited Private Company

2. Company Limited by guarantee

The Partnerships and Business Name Law, Chapter 116, also provides for two general types of Partnerships:

a) General Partnership

b) Limited Partnership

Further, section 347 of the companies Law Chapter 113 provides for the registration in Cyprus of foreign companies under the form of a branch.

We can help new clients to provide all the necessary procedures for the formation of companies in Cyprus and other major jurisdictions through lawyer offices in Nicosia.

The incorporation procedures are designed in such way as to make the formation process as quick and efficient as possible.

Related to the process of formation and administration of an international business company in Cyprus, the lawyers can offer:

  • Company Incorporation                                                                         
  • provision of a Registered Address                                                             
  • provision of a Company Secretary                                                          
  • provision of a Resident Director (Optional, but advisable for tax reasons)
  • provision of Nominee Shareholders (Optional)
  • opening of Bank Account in Cyprus                     :
  • preparation of directors’ and shareholders’ meetings
  • arrangements for Annual General Meetings and
  • maintenance of the books, records, and registers.

Information required for a company formation

Company Name: you can provide three (3) names of your preference to check availability.

Shelf companies are available in some jurisdictions if a company is neededimmediately. Shelf companies are regular companies and as such the same as companies to be incorporated, except that shelf companies have already been incorporated previously and are ready to engage in business immediately.

Company Activity:

Resume of the company activity with sufficient information on the company, including information regarding main business activity, expected turnover, expected movements on the bank account etc.

Personal Information:

  • Some basic information about your current company and its activities;
  • Full name and addresses of the beneficial owners/shareholders;
  • Full name and addresses of directors if you will provide your own;
  • Copies of passports of all beneficial owners/shareholders, directors, and bank account signatories validated;

Utility Bill:

Original of utility bill (electricity, water, telephone, cable TV or gas) confirming client's current address (less than 3 months old).

Personal Bank Reference Letter:

A financial reference letter from a bank. The letter should be on the financial institution's letterhead, and should include the signature of an official, and the contact information (address, telephone, fax, email etc.).

If a bank account is requested:

  • Name of the bank with which you wish to open an account (a list with our banking partners can be provided upon request);
  • Currency and type of account;
  • Names of the signatories to the account, and the way in which they will sign (jointly, solely, etc.).

These documents are solely for M. Kolokotronis + Associatesuse and will be kept secure and confidential. This request is for compliance purposes only and our client’s reputation is not being questioned. Furthermore and according to the international regulations on the prevention of drug trafficking and money laundering, we are strictly implements Due Diligence guidelines and comply with the industry standard of “Know Your Client”.

Timeframe

A standard ready company package takes around one week to prepare and deliver, also depending on the jurisdiction. Bank accounts will take from three days up to three weeks to become fully operational. Custom orders take 3-8 weeks to complete depending on jurisdiction.

REGISTRAR OF COMPANIES RIGHTS AND FEES

Payable on the incorporation of a company

Authorised share capital

€102,52 plus 0.6%

Issued share capital

No stamp duty is due when the shares are issued at their nominal value. There is a flat duty of €17,09 if the shares are issued at a premium.

Payables on subsequent issues (increases)

Authorised share capital

0,6% on additional amount of share capital

Issued share capital

A flat duty of €17,09 on each issue is payable, regardless if the shares are issued at their nominal value or at a premium

Change in the company’s name

€34,17

Application for registration of a business name

€68,34

Filling of the Annual Return

€17,09

Filling of an overdue Annual Return

€34,17

Application for registration of either a general or a limited partnership

€102,52

Notification of a registered mortgage on immovable property in Cyprus irrespective of the value concerned

€17,09

     

STAMP DUTIES

The table below shows details of the rate of duty payable on a certain documents:

Type of Document

Duty to be paid

Receipts for amounts from €3.42 to €34.17

€0,03

Receipts for amounts from €34.17

€0,07

Contracts for amounts up to €170.860,14

0.15%

Contracts for amounts over €170.860,14

0,2% plus €256,29 up to a maximum levy of €17.086,01

Contracts without fixed amount

€34,17

Letters of guarantee

€3,42

Letters of credit

€1,71

Bills of exchange (payables within three days on demand or at sight)

€0,85

Customs declaration documents

€17,09 to €34,17

Bills of lending

€3,42

Special power of attorney

€1,71

General power of attorney

€5,13

Certificated copies of contracts and documents

€1,71

Will

€17,09

Estate administration document

€8,54

Exceptions

  • Transactions that fall within the scope of reorganizations are exempt from stamp duty.
  • Contracts relating to assets situated outside Cyprus or business dealings that take place outside Cyprus are also exempt from stamp duty.