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Cyprus’ accession to the European Union (EU) in 2004 offers a valuable launch pad for foreign investors. As a full EU Member State, Cyprus enjoys the benefits of EU membership such as free movement of goods, services, capital and people. The EU’s regulatory framework provides certainty and credibility for investments to thrive in a safeguarded manner. As a result, Cyprus is an effective gateway to the EU market.

Despite the economic efforts of COVID-19, Cyprus remains resilient. Cyrus’s approach to the COVID is praised by the EU and referred as a model for health and economic recovery. What’s more, key sectors of the economy, including real estate and business services are resuming more than originally expected.

Starting your company

Cyprus’ legal framework is based upon the UK common law and English is the business language across many sectors. Incorporating a limited liability company is considerably fast and easy with no requirement for a Cypriot resident as shareholder or director and can be either individuals or companies. Although a registered office of company shall be a Cypriot address and offshore companies are prohibited. There is no minimum paid-in capital requirement, though the standard authorised share capital is 1,000 Euros.

There are no sector restrictions for foreign direct investment, however, companies shall be a fully operating. Under the EU regulations, companies with no business operations are forbidden and accounting and annual audits are required.

Advantages of investing Cyprus

Cyprus boasts a liberalized Foreign Direct Investment Policy for both EU and third country investors. The island offers a range of advantages for foreign investor to access the EU market and surrounding countries. We round-up three highlights in investing in Cyprus.


Companies established in Cyprus benefit from low tax rates. With corporate tax at 12.5% and almost 60 Double Taxation Treaties with countries such as Central and Eastern European countries, China and India, Cyprus is often utilised as a regional headquarters for many corporations.

Stability and Geography

The stable economy and government coupled with a strategic geographical location attracts a wealth of international investors to launch businesses from Cyprus into the EU, Eastern Europe, Middle East and Africa.  Business operation costs are one of the lowest in the EU with a high qualified English-speaking workforce and low- rental costs allows

Business operations

Operating in Cyprus is relatively low in comparison with other EU countries. Office rental and labour costs are among the lowest in the EU. Although, there is highly qualified workforce to support your business operations.

COVID-19 governmental support

To combat the economic effects of COVID-19, financial measures were announced by the Cypriot President on May 27, 2020 to support business. The main financial support available for companies include:

  • Cyprus Entrepreneurship Fund of 800 million euros for small and medium enterprises
  • Increased European Investment Bank lending plan by 500m euros for small and medium-sized enterprises
  • Interest rate subsidy for new business loans, applicants include self-employed workers, who face a lack of liquidity as a result of the pandemic (in the first year, interest rates be subsidised up to 3.5 percentage points, in third to fourth year the interest rate will be subsidized by 2 percentage points for small and medium entities and self-employed and 1.5 percentage points for large companies.)
  • Subsidy for micro, small enterprises and independent employees.Subsidises are aims to cover part of the rent and operating expenses. The total amount of the subsidy or sponsorship exceeds 100 million euros.

What you can look forwards to:

For Cyprus, foreign investment remains priority in its economic growth and strategy. Cyprus may be viewed as small country, however the ongoing economic transition offers many opportunities for growth and investment in many sectors, such as energy, banks, shipping, tourism, stock exchange, large-scale development projects, as well as education and health.

Author: Maria Georgiou

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