2023 Doing Business in Cyprus (UK Edition)
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TheProfilerGroup<br />
DOING BUSINESS<br />
CYPRUS<br />
UNITED KINGDOM EDITION
DOING BUSINESS C YPRUS<br />
2<br />
UNITED KINGDOM EDITION<br />
TheProfilerGroup<br />
The Profiler Group is a specialist publisher of country <strong>in</strong>formation<br />
that assists corporations manag<strong>in</strong>g operations across national<br />
borders with trade, <strong>in</strong>vestment and relocation decisions. The Profiler<br />
Group is recognised by senior bus<strong>in</strong>ess executives, government<br />
representatives, <strong>in</strong>stitutions and global organisations as a lead<strong>in</strong>g<br />
provider of <strong>in</strong>formative and <strong>in</strong>sightful country <strong>in</strong>telligence.<br />
EUROPE<br />
16, Elia Papakyriakou, Suite 101,<br />
Engomi, 2415 Nicosia, <strong>Cyprus</strong><br />
cyprus@theprofilergroup.com<br />
www.theprofilergroup.com<br />
www.cyprusprofile.com<br />
NORTH AMERICA<br />
21-2123 Walkers L<strong>in</strong>e,<br />
Burl<strong>in</strong>gton Ontario, L7M 4Z9, Canada<br />
RESEARCH & CONTRIBUTIONS<br />
The Profiler Group staff<br />
PUBLICATION DATE<br />
December <strong>2023</strong><br />
The <strong>in</strong>formation <strong>in</strong>cluded <strong>in</strong> this publication is<br />
for <strong>in</strong>formation purposes only and is subject<br />
to change. With regard to the licens<strong>in</strong>g of a<br />
bus<strong>in</strong>ess, <strong>in</strong>come generation or any other legal<br />
or account<strong>in</strong>g matters, the Publisher strongly<br />
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All rights reserved. Reproduction <strong>in</strong> whole or part<br />
is strictly prohibited without written permission.<br />
Op<strong>in</strong>ions expressed <strong>in</strong> this publication are not<br />
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reasonable care is taken to ensure truth and<br />
accuracy, but the editor and publishers cannot<br />
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COOPERATION PARTNERS
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The New Equation is a community of solvers com<strong>in</strong>g<br />
together <strong>in</strong> unexpected ways. It’s human-led and techpowered.<br />
It’s how we build trust and deliver susta<strong>in</strong>ed<br />
outcomes for today and tomorrow.<br />
Learn more at www.pwc.com.cy/en/the-new-equation.html
A NEW PERSPECTIVE<br />
The countdown to a new<br />
dest<strong>in</strong>ation has begun, with<br />
workers at Trilogy putt<strong>in</strong>g their<br />
f<strong>in</strong>al touches on the plaza<br />
exteriors, the landscap<strong>in</strong>g,<br />
and the tower facades.<br />
Offices at the sky-rise<br />
development sold out last<br />
year and there are only twenty<br />
apartments available for<br />
sale <strong>in</strong> the upfront towers.<br />
Another success story<br />
by Cybarco, with a new<br />
community <strong>in</strong> the mak<strong>in</strong>g.<br />
is noth<strong>in</strong>g quite like Trilogy. It’s so much more<br />
than a place to live, work and play. It’s an experience.<br />
“There<br />
For everyone. From the apartment owner and the<br />
office executive to the visitor <strong>in</strong> one of our restaurants or<br />
the passer-by.” This is Trilogy. An urban oasis with the buzz<br />
of a European city, right at the heart of Limassol’s seafront.<br />
Executive Director and Cybarco Development’s CEO, Michalis<br />
Hadjipanayiotou, is no stranger to the transformation a project<br />
like this br<strong>in</strong>gs to a city and its community, hav<strong>in</strong>g also been<br />
<strong>in</strong>volved <strong>in</strong> the fruition of Limassol Mar<strong>in</strong>a and The Oval. “It’s<br />
always so excit<strong>in</strong>g to watch our vision come to reality. The<br />
Project Management team has been work<strong>in</strong>g around the<br />
clock to br<strong>in</strong>g this vibrant dest<strong>in</strong>ation to life and we’re all really<br />
look<strong>in</strong>g forward to it! It’s the reason we recently rebranded. It’s<br />
a new perspective for everyone.”<br />
The third and f<strong>in</strong>al build<strong>in</strong>g – part of the second phase<br />
which <strong>in</strong>cludes a private oasis for the use of all residents<br />
– is already 75% sold and its construction on the rear side<br />
of the plot is well underway. The luxurious and spacious<br />
seaview apartments at “North Residences” offer an unrivalled<br />
opportunity to be a part of Trilogy’s unique experience, just<br />
150m from the beach and with prices from €680,000. “This<br />
last piece of the Trilogy puzzle meets current demand for first<br />
or second homeowners and <strong>in</strong>vestors attracted to our rental<br />
yields. It comb<strong>in</strong>es stunn<strong>in</strong>g design with breathtak<strong>in</strong>g views<br />
of the sea, the city, the development’s oasis, and its iconic<br />
upfront towers. It’s impossible to f<strong>in</strong>d other apartments <strong>in</strong><br />
Limassol, at this distance from the sea, and at these prices,<br />
with 6,700m 2 of private landscaped gardens, a children’s play<br />
area, swimm<strong>in</strong>g pools and pool bar literally on their doorstep.
Residents will leave their apartment, take the lift to ground<br />
level, walk through the North Residences’ reception lobby,<br />
past their private crèche, gym, café, and wet spa, and out <strong>in</strong>to<br />
the oasis. It’s a truly fantastic way to enjoy Trilogy, its five-star<br />
hotel facilities and services, and the 6,850m 2 public plaza.”<br />
An on-site team of dedicated professionals has already been<br />
set up to undertake Trilogy’s rentals, property, and lifestyle<br />
management, all under one central reception.<br />
Along with details on the facilities, announcements on the<br />
‘names’ beh<strong>in</strong>d the plaza restaurants, shops and hair salon<br />
are <strong>in</strong> the plann<strong>in</strong>g. With food tast<strong>in</strong>gs for menus <strong>in</strong> their f<strong>in</strong>al<br />
stages and brand<strong>in</strong>g teams work<strong>in</strong>g beh<strong>in</strong>d the scenes to br<strong>in</strong>g<br />
the very best Mediterranean flair to Trilogy, there is no doubt<br />
that a place for togetherness is <strong>in</strong> the mak<strong>in</strong>g; an energised<br />
community liv<strong>in</strong>g life with a new and <strong>in</strong>spir<strong>in</strong>g view of the future.<br />
For more <strong>in</strong>formation on<br />
the available properties at<br />
Trilogy visit the website<br />
trilogylimassol.com<br />
or contact +357 25 362800.<br />
A DESTINATION BY
DOING BUSINESS C YPRUS<br />
6<br />
UNITED KINGDOM EDITION<br />
Contents<br />
08<br />
12<br />
20<br />
24<br />
38<br />
40<br />
46<br />
52<br />
56<br />
60<br />
62<br />
68<br />
74<br />
76<br />
81<br />
CYPRUS AT A GLANCE<br />
Key Facts & Figures<br />
COUNTRY OVERVIEW<br />
Small Island, Big Ambitions<br />
INSIGHT<br />
M<strong>in</strong>ister of Energy, Commerce, and Industry George Papanastasiou<br />
FOREIGN DIRECT INVESTMENT<br />
Secure EU Investment Dest<strong>in</strong>ation<br />
INSIGHT<br />
M<strong>in</strong>ister of Foreign Affairs Constant<strong>in</strong>os Kombos<br />
INTERVIEW<br />
British High Commissioner to the Republic of <strong>Cyprus</strong><br />
Irfan Siddiq OBE<br />
INTERVIEW<br />
High Commissioner of the Republic of <strong>Cyprus</strong> to the <strong>UK</strong><br />
Andreas S. Kakouris<br />
SPOTLIGHT<br />
<strong>Cyprus</strong> Real Estate<br />
PROPERTY SHOWCASE<br />
Lead<strong>in</strong>g Developments <strong>in</strong> <strong>Cyprus</strong><br />
INSIGHT<br />
CEO of Invest <strong>Cyprus</strong><br />
INCENTIVES<br />
Attract<strong>in</strong>g Non-EU <strong>Bus<strong>in</strong>ess</strong><br />
INTERVIEW<br />
<strong>Cyprus</strong>-<strong>UK</strong> <strong>Bus<strong>in</strong>ess</strong> Association President Marios Andreou<br />
WHO’S WHO IN CYPRUS<br />
The def<strong>in</strong>itive guide to <strong>Cyprus</strong>’ lead<strong>in</strong>g companies, executives,<br />
and professional advisors<br />
BUSINESS OPERATING ENVIRONMENT<br />
<strong>Bus<strong>in</strong>ess</strong> operat<strong>in</strong>g environment guide <strong>in</strong>clud<strong>in</strong>g taxation, bus<strong>in</strong>ess costs,<br />
commercial and residential property, and salary survey<br />
TAXATION<br />
Tax and Regulatory Regime of <strong>Cyprus</strong>
There are new<br />
competitors with<br />
a fresh vision.<br />
Is your company agile enough<br />
to outpace them?<br />
Us<strong>in</strong>g <strong>in</strong>novative tools, th<strong>in</strong>k<strong>in</strong>g and<br />
frameworks, KPMG can help adapt your<br />
bus<strong>in</strong>ess <strong>in</strong> the face of constant disruption.<br />
Learn more at kpmg.com.cy<br />
©<strong>2023</strong> KPMG Limited, a <strong>Cyprus</strong> limited liability company and a member firm of the KPMG global organization of <strong>in</strong>dependent member firms affiliated with KPMG<br />
International Limited, a private English company limited by guarantee. All rights reserved.<br />
The KPMG name and logo are trademarks used under license by the <strong>in</strong>dependent member firms of the KPMG global organization.
DOING BUSINESS C YPRUS<br />
8<br />
UNITED KINGDOM EDITION<br />
CYPRUS<br />
AT A<br />
GLANCE<br />
Ly<strong>in</strong>g at the crossroads of Europe, Asia and Africa, <strong>Cyprus</strong> has long served as a<br />
major eastern trad<strong>in</strong>g post. It is a small country, but the third largest island <strong>in</strong><br />
the Mediterranean Sea and shares a maritime border with Egypt 300km to the<br />
south, Lebanon 108km to the east and Turkey 71km to the north, while ma<strong>in</strong>land<br />
Greece lies 800km to the north-west. With 10,000 years of history, the island’s<br />
strategic location has long made it a jewel <strong>in</strong> the crown of the powers of the day.<br />
PAPHOS<br />
(Pafos)<br />
100,175<br />
Paphos<br />
International<br />
Airport<br />
LIMASSOL<br />
(Lemesos)<br />
262,236<br />
NICOSIA<br />
(Lefkosia)<br />
350,824<br />
Larnaca<br />
International<br />
Airport<br />
LARNACA<br />
(Larnaka)<br />
155,753<br />
35ºN<br />
33ºE<br />
FAMAGUSTA<br />
(Ammochostos)<br />
54,282
DOING BUSINESS C YPRUS<br />
9<br />
UNITED KINGDOM EDITION<br />
CYPRUS<br />
DATA<br />
MEMBERSHIPS<br />
EU & Eurozone<br />
World Trade<br />
Organization<br />
United Nations<br />
Council of Europe<br />
Commonwealth<br />
World Bank & IMF<br />
RELIGION<br />
89.1%<br />
Greek Orthodox<br />
TOTAL POPULATION (2021)<br />
923,272<br />
Republic of <strong>Cyprus</strong><br />
80%<br />
Cypriot<br />
20%<br />
Non-Cypriot<br />
OFFICIAL LANGUAGES<br />
Greek &<br />
Turkish<br />
(bus<strong>in</strong>ess generally<br />
conducted <strong>in</strong> English)<br />
TIME<br />
+2 Hours<br />
ahead of GMT<br />
AREA & SIZE<br />
9,251 km 2<br />
(3,355 km 2 <strong>in</strong> the<br />
occupied area)<br />
POPULATION DENSITY<br />
136<br />
(persons per km 2 )<br />
MEDIAN AGE<br />
38.5<br />
CURRENCY<br />
Euro (€)<br />
SUNSHINE<br />
340 days<br />
of sunsh<strong>in</strong>e/year<br />
2.9% Roman Catholic<br />
2.0% Protestant/Anglican<br />
1.8% Muslim<br />
1.7% Unknown/Atheist<br />
1.0% Buddhist<br />
1.5% Other<br />
AVERAGE TEMPERATURE<br />
+13ºC<br />
W<strong>in</strong>ter<br />
+34ºC<br />
Summer<br />
MAIN MEDIA<br />
<strong>Cyprus</strong> Mail<br />
Phileleftheros<br />
Politis<br />
CyBC
DOING BUSINESS C YPRUS<br />
10<br />
UNITED KINGDOM EDITION<br />
CYPRUS<br />
BUSINESS<br />
FIGURES<br />
TOTAL GDP<br />
€27.8<br />
billion<br />
(2022)<br />
GDP PER CAPITA<br />
€30,434<br />
(2022)<br />
12%<br />
Taxes & Subsidies<br />
4.8%<br />
Construction<br />
7.3%<br />
M<strong>in</strong><strong>in</strong>g, manufactur<strong>in</strong>g,<br />
electricity & water<br />
GDP<br />
BY SECTOR<br />
74.3%<br />
Services<br />
1.6%<br />
Agriculture,<br />
forestry & fish<strong>in</strong>g<br />
UNEMPLOYMENT<br />
6.8%<br />
(2022)<br />
GDP GROWTH<br />
5.6%<br />
(2022)<br />
INFLATION<br />
8.1%<br />
(2022)<br />
INTERNATIONAL RANKINGS<br />
Standard & Poor’s<br />
BBB<br />
CORPORATE<br />
TAX RATE<br />
12.5%<br />
TIME TO START<br />
UP A BUSINESS<br />
1.3 days<br />
ACCOUNTING<br />
STANDARD<br />
IFRS<br />
Fitch<br />
BBB Moody’s<br />
Baa2<br />
(November <strong>2023</strong>)<br />
MAIN TRADING PARTNERS<br />
<strong>UK</strong><br />
Germany<br />
Italy<br />
France<br />
Israel<br />
Greece<br />
Ch<strong>in</strong>a<br />
CRIME<br />
1.29<br />
per 100k<br />
population
DOING BUSINESS C YPRUS<br />
12<br />
UNITED KINGDOM EDITION<br />
COUNTRY OVERVIEW<br />
Small Island, Big Ambitions<br />
<strong>Cyprus</strong> cont<strong>in</strong>ues to attract professional expats and<br />
foreign <strong>in</strong>vestors to its shores thanks to its relaxed<br />
lifestyle coupled with bourgeon<strong>in</strong>g prospects <strong>in</strong><br />
multiple sectors. The island nation has a long and rich<br />
history and is undergo<strong>in</strong>g yet another transformation<br />
as it places strong focus on <strong>in</strong>novation, technology,<br />
and renewables to future proof its economy.<br />
Located <strong>in</strong> the Eastern Mediterranean at the crossroads of Europe, the Middle East<br />
and Africa, <strong>Cyprus</strong>’ strategic position has always played a key role <strong>in</strong> shap<strong>in</strong>g its<br />
10,000-year history and <strong>in</strong> develop<strong>in</strong>g the island <strong>in</strong>to a convenient centre for trade<br />
and <strong>in</strong>ternational bus<strong>in</strong>ess. Despite be<strong>in</strong>g a country of less than a million people,<br />
the Republic of <strong>Cyprus</strong> has steadily built itself <strong>in</strong>to a thriv<strong>in</strong>g bus<strong>in</strong>ess centre over<br />
the decades. An EU and eurozone member and with one of the highest educated<br />
populations <strong>in</strong> Europe, <strong>Cyprus</strong> has built a strong service-based economy. Its lowcost<br />
bus<strong>in</strong>ess environment with a wealth of support services, a sophisticated ICT<br />
<strong>in</strong>frastructure and <strong>in</strong>vestor-friendly tax regime – backed up by an extensive network<br />
of double taxation agreements with 68 countries – has developed <strong>Cyprus</strong> <strong>in</strong>to an
DOING BUSINESS C YPRUS<br />
13<br />
UNITED KINGDOM EDITION<br />
important European and regional f<strong>in</strong>ancial and bus<strong>in</strong>ess services hub. The country<br />
is also one of Europe’s favourite holiday dest<strong>in</strong>ations, enjoy<strong>in</strong>g 340 days of glorious<br />
sunsh<strong>in</strong>e a year and boasts a beautiful coastl<strong>in</strong>e teem<strong>in</strong>g with stretches of golden<br />
sand, secluded bays and rocky coves, all surrounded by some of the cleanest beaches<br />
and waters <strong>in</strong> the Mediterranean Sea. The landscape is dotted with the fasc<strong>in</strong>at<strong>in</strong>g<br />
rema<strong>in</strong>s of history, from Neolithic settlements and ancient city-k<strong>in</strong>gdoms to<br />
exquisite Byzant<strong>in</strong>e art and magnificent Venetian architecture. With its vibrant and<br />
cosmopolitan lifestyle where East meets West, <strong>Cyprus</strong> offers the perfect balance<br />
between bus<strong>in</strong>ess and leisure.<br />
PEOPLE & CULTURE<br />
While the Republic of <strong>Cyprus</strong> is a<br />
Greek-speak<strong>in</strong>g nation, English<br />
is almost universally spoken and is the<br />
language of <strong>in</strong>ternational bus<strong>in</strong>ess.<br />
German, French and Russian speakers<br />
are also easily found, thanks to the high<br />
number of Cypriots with <strong>in</strong>ternational<br />
degrees, the country’s commercial ties<br />
with the global bus<strong>in</strong>ess community,<br />
and the island’s popularity as a tourist<br />
dest<strong>in</strong>ation. <strong>Cyprus</strong> is well known for its<br />
hospitality, a fact reflected <strong>in</strong> the Greek word, xenos, used for both stranger and guest.<br />
Life is meant to be enjoyed <strong>in</strong> <strong>Cyprus</strong>, which is renowned for its excellent quality of<br />
life. Cafe culture predom<strong>in</strong>ates, with both bus<strong>in</strong>ess and social meet<strong>in</strong>gs tak<strong>in</strong>g place<br />
over a leisurely frappe (iced coffee) <strong>in</strong> the numerous cafes <strong>in</strong> every town and city. As<br />
with most Mediterranean cultures, food also plays a vital role <strong>in</strong> family and social<br />
life. The famous <strong>Cyprus</strong> meze – a large selection of small, delectable dishes – is best<br />
enjoyed siga siga (slowly) and al fresco.<br />
RESILIENT EU ECONOMY<br />
<strong>Cyprus</strong> has a resilient economy that has time and time aga<strong>in</strong> proven its capacity<br />
to adjust to cont<strong>in</strong>uously chang<strong>in</strong>g conditions and bounce back from external<br />
shocks. Before its <strong>in</strong>dependence from<br />
the <strong>UK</strong> <strong>in</strong> 1960, the <strong>Cyprus</strong> economy was<br />
primarily based on agriculture and the<br />
export of m<strong>in</strong>erals. However, <strong>in</strong> the last<br />
few decades the country has established<br />
itself as a serious <strong>in</strong>ternational bus<strong>in</strong>ess<br />
and service centre for shipp<strong>in</strong>g, f<strong>in</strong>ancial<br />
services and commerce, and is classified<br />
by the World Bank as a high-<strong>in</strong>come<br />
country. The island’s accession to the EU<br />
<strong>in</strong> 2004 with the subsequent adoption of<br />
the euro <strong>in</strong> 2008, was the catalyst for its<br />
transformation <strong>in</strong>to a competitive f<strong>in</strong>ancial<br />
and bus<strong>in</strong>ess services hub.<br />
IOffer<strong>in</strong>g a tax-efficient<br />
EU company domicile, the<br />
country is emerg<strong>in</strong>g as<br />
an <strong>in</strong>creas<strong>in</strong>gly attractive<br />
location for fund managers<br />
and promoters, and a<br />
compell<strong>in</strong>g dest<strong>in</strong>ation for<br />
regional headquarters and a<br />
base for tech companies.
DOING BUSINESS C YPRUS<br />
14<br />
UNITED KINGDOM EDITION<br />
Follow<strong>in</strong>g the country’s f<strong>in</strong>ancial crisis<br />
<strong>in</strong> 2013, <strong>Cyprus</strong> undertook a major<br />
reform agenda and while still fac<strong>in</strong>g<br />
some economic challenges, the small<br />
EU nation has demonstrated resilience<br />
and an ability to bounce back to growth.<br />
The year 2015 signalled a sooner-thanexpected<br />
exit from recession and a rapid<br />
economic turnaround followed, with 2017<br />
record<strong>in</strong>g almost 4% growth – earn<strong>in</strong>g<br />
<strong>Cyprus</strong> praise as an economic success<br />
story. <strong>Cyprus</strong>’ resilience <strong>in</strong> the face of the<br />
pandemic was once aga<strong>in</strong> evident with<br />
GDP growth reach<strong>in</strong>g a strong 5.6% <strong>in</strong><br />
2022, although the European Commission<br />
forecasts a downturn to 2.2% growth <strong>in</strong><br />
<strong>2023</strong>. Consistent credit rat<strong>in</strong>g upgrades<br />
have further boosted confidence and<br />
foreign direct <strong>in</strong>vestment has been<br />
flow<strong>in</strong>g <strong>in</strong>to all key sectors. <strong>Cyprus</strong> has<br />
reta<strong>in</strong>ed and strengthened its status<br />
as an attractive <strong>in</strong>vestment gateway to<br />
the EU and other high-growth markets,<br />
as well as a secure base to tap <strong>in</strong>to<br />
opportunities <strong>in</strong> the Middle East. Offer<strong>in</strong>g<br />
a tax-efficient EU company domicile, the<br />
country is emerg<strong>in</strong>g as an <strong>in</strong>creas<strong>in</strong>gly<br />
attractive location for fund managers and<br />
promoters, and a compell<strong>in</strong>g dest<strong>in</strong>ation<br />
for regional headquarters and a base for<br />
tech companies.<br />
GROWING TECH CLUSTER<br />
The technology space <strong>in</strong> <strong>Cyprus</strong> is<br />
see<strong>in</strong>g a fresh boost with more state<br />
support to the sector, the launch of new<br />
national strategies to <strong>in</strong>tegrate <strong>in</strong>novative<br />
tech, and fresh <strong>in</strong>centives to attract<br />
more digital nomads, IT start-ups and<br />
regional headquarters. With its new focus<br />
on long-term development outcomes,<br />
<strong>Cyprus</strong> is determ<strong>in</strong>ed to diversify and<br />
harness growth with a technology-driven<br />
economy. The biggest spender by far<br />
on IT <strong>in</strong> <strong>Cyprus</strong> is the f<strong>in</strong>ancial sector,<br />
followed by the telecoms providers and<br />
the public service. Albeit one of the<br />
smallest EU member states, research and<br />
EU Member s<strong>in</strong>ce 2004,<br />
Eurozone member s<strong>in</strong>ce 2008<br />
<strong>Cyprus</strong> is the EU’s largest<br />
shipmanagement centre and<br />
amongst the top three <strong>in</strong> the world<br />
<strong>Cyprus</strong> is an established<br />
<strong>in</strong>ternational bus<strong>in</strong>ess and service<br />
centre for shipp<strong>in</strong>g, f<strong>in</strong>ancial<br />
services and commerce, and<br />
is classified by the World Bank<br />
as a high-<strong>in</strong>come country<br />
With its new focus on longterm<br />
development outcomes,<br />
<strong>Cyprus</strong> is determ<strong>in</strong>ed to diversify<br />
and harness growth with a<br />
technology-driven economy.
DOING BUSINESS C YPRUS<br />
15<br />
UNITED KINGDOM EDITION<br />
development is an area where <strong>Cyprus</strong> punches well above its weight. Unprecedented<br />
<strong>in</strong>vestment <strong>in</strong>to the sector and ground-break<strong>in</strong>g projects are establish<strong>in</strong>g this small<br />
island, not only as an <strong>in</strong>novation and research hub, but as a regional centre of excellence<br />
provid<strong>in</strong>g strong l<strong>in</strong>ks with the global scientific and technical <strong>in</strong>novation community.<br />
INVESTMENT FUND BOOM<br />
C<br />
yprus has big ambitions <strong>in</strong> the <strong>in</strong>vestment funds sector to target a bigger piece<br />
of the global asset management pie. The steady growth <strong>in</strong> both Assets under<br />
Management and <strong>in</strong> the number of fund structures licensed and active <strong>in</strong> <strong>Cyprus</strong> have<br />
underl<strong>in</strong>ed the strength and appeal of the novice domicile. Assets under Management<br />
(AuM) have seen a formidable <strong>in</strong>crease from €2.7 billion <strong>in</strong> 2016 to €10.7 billion <strong>in</strong><br />
the second quarter of <strong>2023</strong>, show<strong>in</strong>g that it is not the sector’s size but its fast growth<br />
that has impressed, and is be<strong>in</strong>g recognised by the global asset management and<br />
<strong>in</strong>vestor community. Investment funds have already <strong>in</strong>vested more than €2.5 billion<br />
<strong>in</strong> several sectors of the Cypriot economy, such as shipp<strong>in</strong>g, hospitality, education,<br />
healthcare, and renewable energy. <strong>Cyprus</strong> offers both EU-regulated Undertak<strong>in</strong>gs of<br />
Collective Investment <strong>in</strong> Transferable Securities (UCITS) and Alternative Investment<br />
Funds (AIFs). In July 2018, the country upgraded its AIF framework and <strong>in</strong>troduced<br />
Registered AIFs (RAIFs), which do not require authorisation by the supervis<strong>in</strong>g <strong>Cyprus</strong><br />
Securities and Exchange Commission (CySEC) to commence operations provided they<br />
are externally managed by an Alternative Investment Fund Manager (AIFM) based<br />
<strong>in</strong> <strong>Cyprus</strong> or another EU country. The upgraded legislation has been hailed ‘groundbreak<strong>in</strong>g’<br />
and offers a significantly more time- and cost-efficient means of establish<strong>in</strong>g<br />
AIFs <strong>in</strong> <strong>Cyprus</strong>. Today, the majority of alternative <strong>in</strong>vestment funds <strong>in</strong> <strong>Cyprus</strong> are of a<br />
small and medium size and focus on debt and equity securities, real estate and private<br />
equity. However, <strong>Cyprus</strong> has also attracted larger funds <strong>in</strong>clud<strong>in</strong>g one with assets of<br />
€500 million under management. The number of alternative <strong>in</strong>vestment funds has<br />
more than doubled <strong>in</strong> the last five years and foreign UCITS are now widely marketed <strong>in</strong><br />
<strong>Cyprus</strong>, <strong>in</strong>clud<strong>in</strong>g ones promoted by major <strong>in</strong>ternational f<strong>in</strong>ancial <strong>in</strong>stitutions.
DOING BUSINESS C YPRUS<br />
16<br />
UNITED KINGDOM EDITION<br />
major success story for <strong>Cyprus</strong><br />
A has been the maritime sector,<br />
which accounts for around €1 billion <strong>in</strong><br />
annual revenue and approximately 7%<br />
of the island’s GDP – and of this figure,<br />
shipmanagement alone accounts for 5%.<br />
Apart from offer<strong>in</strong>g shipmanagement<br />
and bus<strong>in</strong>ess services to the <strong>in</strong>dustry, the<br />
<strong>Cyprus</strong> Registry is classified as the third<br />
largest merchant fleet <strong>in</strong> the European<br />
Union and the 11th largest <strong>in</strong> the world.<br />
In addition, <strong>Cyprus</strong> is the EU’s largest<br />
GLOBAL SHIPPING HUB<br />
I<strong>Cyprus</strong> has reta<strong>in</strong>ed and<br />
strengthened its status as<br />
an attractive <strong>in</strong>vestment<br />
gateway to the EU and<br />
other high-growth markets,<br />
as well as a secure base<br />
to tap <strong>in</strong>to opportunities<br />
<strong>in</strong> the Middle East<br />
shipmanagement centre and amongst<br />
the top three <strong>in</strong> the world. The sector has seen growth <strong>in</strong> the past few years and <strong>Cyprus</strong><br />
is currently look<strong>in</strong>g at restructur<strong>in</strong>g the commercial shipp<strong>in</strong>g sector to strengthen its<br />
competitive edge. S<strong>in</strong>ce <strong>in</strong>troduc<strong>in</strong>g an advantageous EU-approved tonnage tax system<br />
<strong>in</strong> 2010, the island has cont<strong>in</strong>ued to attract <strong>in</strong>creas<strong>in</strong>g numbers of shipp<strong>in</strong>g companies<br />
from across the world. The country’s maritime capital, Limassol, is home to some of the<br />
most <strong>in</strong>fluential names <strong>in</strong> shipp<strong>in</strong>g today manag<strong>in</strong>g around 20% of the world’s thirdparty<br />
managed fleet.<br />
EAST MED ENERGY PLAYER<br />
Apart from the sun and the sea, <strong>Cyprus</strong> has few natural resources and has been<br />
dependent on oil imports to satisfy its energy demands. However, the substantial<br />
discovery of natural gas and potential oil deposits <strong>in</strong> <strong>Cyprus</strong>’ Exclusive Economic Zone<br />
(EEZ) <strong>in</strong> the Mediterranean Sea is expected to change all this. Exploratory drill<strong>in</strong>gs<br />
by global energy giants have confirmed natural gas reserves that could meet <strong>Cyprus</strong>’<br />
domestic gas demand for over 100 years, and a surplus for export. The hydrocarbons<br />
race <strong>in</strong> <strong>Cyprus</strong>’ waters has attracted <strong>in</strong>ternational energy heavyweights, such as Total,<br />
ENI, Chevron, Kogas, Royal Dutch Shell, and ExxonMobil to explore the island’s waters<br />
for new discoveries and multiple auxiliary services companies have set up to support<br />
these efforts. With 340 days of sunsh<strong>in</strong>e to harness, solar energy has also become a<br />
bit of a boom segment for <strong>Cyprus</strong> recently. The government is plac<strong>in</strong>g strong focus<br />
on renewable energy and work<strong>in</strong>g towards achiev<strong>in</strong>g a zero-carbon economy. The<br />
country’s top-tier universities and research <strong>in</strong>stitutes are also play<strong>in</strong>g a pivotal role <strong>in</strong><br />
these efforts to create a more susta<strong>in</strong>able energy mix through <strong>in</strong>novation <strong>in</strong> smart tech<br />
and research <strong>in</strong> ways to battle climate change.<br />
DIVERSIFYING TOURISM<br />
Tourism has been a key driv<strong>in</strong>g force of the Cypriot economy for decades, and pre-<br />
Covid the country saw consecutive years of record-break<strong>in</strong>g numbers of tourist<br />
arrivals and revenue. Although the pandemic temporarily stifled the thriv<strong>in</strong>g sector,<br />
tourist arrival figures are rebound<strong>in</strong>g and new projects currently underway are set<br />
to strengthen and diversify <strong>Cyprus</strong>’ tourism product and encourage more yearround<br />
visitors, a strategy <strong>Cyprus</strong> is fully committed to. These projects range from the
DOING BUSINESS C YPRUS<br />
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UNITED KINGDOM EDITION<br />
Kourion<br />
construction of new golf courses, luxury mar<strong>in</strong>a developments and the upgrad<strong>in</strong>g of<br />
the island’s wellness and medical tourism product. A new and excit<strong>in</strong>g prospect is the<br />
Republic’s first-ever luxury cas<strong>in</strong>o resort. The €600 million <strong>in</strong>tegrated resort, run by a<br />
consortium with renowned Hong Kong player Melco, exceeds five-star status and has<br />
opened a whole new market for niche tourism on the island.<br />
APPEALING REAL ESTATE<br />
The <strong>Cyprus</strong> real estate sector was show<strong>in</strong>g strong market performance straight<br />
through to 2019, but 2020 marked a turn<strong>in</strong>g po<strong>in</strong>t as the pandemic hit worldwide.<br />
However, 2022 and <strong>2023</strong> have showed dynamic momentum <strong>in</strong> sales, underl<strong>in</strong><strong>in</strong>g the<br />
strong confidence of both local and foreign buyers <strong>in</strong> the market. <strong>Cyprus</strong>’ appeal has<br />
rema<strong>in</strong>ed strong amongst <strong>in</strong>ternational <strong>in</strong>vestors, expats and retirees thanks to its<br />
Mediterranean climate, high quality of life and safety, as well as its status as an EU<br />
member state conveniently located between three cont<strong>in</strong>ents. <strong>Cyprus</strong> has one of the<br />
highest home ownership rates <strong>in</strong> Europe and also has a longstand<strong>in</strong>g market for<br />
second homes and holiday villas, mak<strong>in</strong>g the economy heavily reliant on the sector.<br />
With new up-market developments, <strong>in</strong>creased foreign <strong>in</strong>vestment <strong>in</strong> top hotels and<br />
major <strong>in</strong>frastructure projects spr<strong>in</strong>g<strong>in</strong>g up, <strong>Cyprus</strong>’ attractiveness as a property<br />
<strong>in</strong>vestment location is set to grow <strong>in</strong> the com<strong>in</strong>g years.<br />
Ayia Napa Mar<strong>in</strong>a
DOING BUSINESS C YPRUS<br />
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UNITED KINGDOM EDITION<br />
STRONG FDI FLOWS<br />
<strong>Cyprus</strong>’ FDI appeal has been on an upward trajectory thanks to a robust economy.<br />
Real GDP growth averaged 4.6% <strong>in</strong> 2018-2022 despite the Covid-19 pandemic.<br />
For the last several years, <strong>Cyprus</strong> has been a hive of activity with several notable<br />
projects already implemented or <strong>in</strong> the pipel<strong>in</strong>e, strengthen<strong>in</strong>g the country’s image<br />
and appeal. Foreign <strong>in</strong>vestment flows have been significant. In the ten-year period<br />
2013-2022, net <strong>in</strong>flows reached €13.5 billion. This <strong>in</strong>vestment was driven by equity,<br />
with real estate, communications and headquarter<strong>in</strong>g play<strong>in</strong>g a significant role.<br />
Ongo<strong>in</strong>g improvements <strong>in</strong> the macroeconomic and f<strong>in</strong>ancial environment have<br />
also revived <strong>in</strong>ternational <strong>in</strong>terest <strong>in</strong> around 30 major development projects on the<br />
island. Investment opportunities <strong>in</strong> <strong>Cyprus</strong>’ large-scale projects span various sectors,<br />
<strong>in</strong>clud<strong>in</strong>g high-value tourism and hous<strong>in</strong>g developments, projects with a special<br />
focus on golf courses and luxury mar<strong>in</strong>as, as well as education, energy, and more<br />
recently the <strong>in</strong>ternational film sector. The growth performance of <strong>Cyprus</strong> over the<br />
last five years has been exceptional and even exceeded <strong>in</strong>ternational expectations,<br />
while successive credit rat<strong>in</strong>g upgrades and new <strong>in</strong>centives have attracted billions<br />
<strong>in</strong> foreign <strong>in</strong>vestment, with significant <strong>in</strong>flows from the US, Asia, and the Middle<br />
East. <strong>Cyprus</strong>’ liberalised Foreign Direct Investment Policy, both for EU citizens and<br />
<strong>in</strong>vestors from third countries, along with its favourable tax regime makes it one of<br />
the most attractive centres for FDI <strong>in</strong> Europe.<br />
Parklane Limassol<br />
BUSINESS AND PLEASURE<br />
Offer<strong>in</strong>g a professional yet relaxed atmosphere that makes do<strong>in</strong>g bus<strong>in</strong>ess<br />
pleasurable as well as profitable, <strong>Cyprus</strong>’ Mediterranean lifestyle coexists happily<br />
with a cutt<strong>in</strong>g-edge <strong>in</strong>ternational bus<strong>in</strong>ess hub, allow<strong>in</strong>g <strong>in</strong>vestors to enjoy the best of<br />
both worlds: a safe and comfortable environment for family life and a sophisticated<br />
<strong>in</strong>frastructure from which to grow and develop bus<strong>in</strong>ess. <strong>Cyprus</strong> comb<strong>in</strong>es numerous<br />
advantages as a bus<strong>in</strong>ess base with its EU-approved tax regime, competitive 12.5%<br />
corporate tax rate and tax breaks for high earners, its pro-bus<strong>in</strong>ess government<br />
and highly skilled workforce – as well as promis<strong>in</strong>g growth and development across<br />
numerous economic sectors. With <strong>Cyprus</strong>’ prospects on the rise, the country has all the<br />
right elements firmly <strong>in</strong> place to strengthen its reputation as an <strong>in</strong>ternational centre of<br />
bus<strong>in</strong>ess excellence <strong>in</strong> one of Europe’s most <strong>in</strong>terest<strong>in</strong>g <strong>in</strong>vestment locations. n
Focus &<br />
Experience<br />
For more than 40 years, lead<strong>in</strong>g f<strong>in</strong>ancial<br />
<strong>in</strong>stitutions, professional advisors, asset<br />
managers, family offices and <strong>in</strong>ternational<br />
bus<strong>in</strong>esses have turned to us for the provision<br />
of <strong>in</strong>dependent corporate, trust and fund<br />
adm<strong>in</strong>istration services. Clients rely on our<br />
worldwide presence, local knowledge and our<br />
commitment to responsiveness, reliability,<br />
attention to detail and personal service.<br />
Contact us to discover how our global<br />
reach, experienced professional personnel,<br />
tailored services and on-the-ground<br />
presence can make a difference to you<br />
and your clients.<br />
Contact:<br />
Andreas Mercouri<br />
Manag<strong>in</strong>g Director, <strong>Cyprus</strong><br />
amercouri@tridenttrust.com<br />
+357 258 20 650<br />
TRIDENTTRUST.COM
DOING BUSINESS C YPRUS<br />
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UNITED KINGDOM EDITION<br />
INSIGHT<br />
M<strong>in</strong>ister of Energy, Commerce and Industry<br />
George<br />
Papanastasiou
DOING BUSINESS C YPRUS<br />
21<br />
UNITED KINGDOM EDITION<br />
<strong>Cyprus</strong> and the <strong>UK</strong> have a strong partnership <strong>in</strong><br />
multiple areas, which sectors are provid<strong>in</strong>g the most<br />
<strong>in</strong>vestment potential at the moment? How can <strong>Cyprus</strong><br />
facilitate more bus<strong>in</strong>ess from the <strong>UK</strong> and make<br />
itself even more attractive to British <strong>in</strong>vestors?<br />
<strong>Cyprus</strong>’ economy has shown great resilience and adaptability to the challenges of the<br />
times, and this has always served as a strong advantage with regard to attract<strong>in</strong>g<br />
foreign <strong>in</strong>vestment. In fact, the island has been benefitt<strong>in</strong>g massively through its<br />
offer<strong>in</strong>g of an exceptionally complete package to <strong>in</strong>vestors, which <strong>in</strong>cludes EU and<br />
eurozone membership, an excellent regulatory structure, an attractive and transparent<br />
tax regime, strong bus<strong>in</strong>ess support services, ease and low cost of do<strong>in</strong>g bus<strong>in</strong>ess and<br />
high standard of liv<strong>in</strong>g, with ideal climate conditions.<br />
In the past 30 years, <strong>Cyprus</strong> has experienced substantial growth, whilst also<br />
ma<strong>in</strong>ta<strong>in</strong><strong>in</strong>g its competitive edge, by expand<strong>in</strong>g key economic sectors such as tourism,<br />
shipp<strong>in</strong>g and f<strong>in</strong>ancial services, which still hold great potential for the British bus<strong>in</strong>ess<br />
community, especially <strong>in</strong> the areas of hospitality, transportation, travel and <strong>in</strong>surance.<br />
The result has been a grow<strong>in</strong>g number of <strong>UK</strong> companies and <strong>in</strong>vestors expand<strong>in</strong>g their<br />
operations <strong>in</strong> <strong>Cyprus</strong>, through participation <strong>in</strong> large-scale or <strong>in</strong>frastructure projects,<br />
corporate entities and various f<strong>in</strong>ancial vehicles and schemes, <strong>in</strong>clud<strong>in</strong>g <strong>in</strong>vestment<br />
funds.<br />
British entrepreneurs have also been us<strong>in</strong>g <strong>Cyprus</strong> as a base to expand<br />
<strong>in</strong>ternationally, thanks to the extrovert bus<strong>in</strong>ess environment, the Common Law<br />
system, the modern <strong>in</strong>frastructure, the high competencies and talent and the longterm<br />
economic growth orientation they can f<strong>in</strong>d on the island.<br />
Additionally, <strong>Cyprus</strong>’ unique lifestyle and the ongo<strong>in</strong>g efforts to overhaul and upgrade<br />
its <strong>in</strong>frastructure and regulatory framework, as well as to viably expand its economy,<br />
have allowed for new, emerg<strong>in</strong>g sectors, such as energy, ICT, higher education and<br />
wellness, to develop <strong>in</strong> a very short period<br />
of time.<br />
<strong>Cyprus</strong> is ranked among the EU’s<br />
strong <strong>in</strong>novators, perform<strong>in</strong>g above EU<br />
average for the second consecutive year,<br />
based on the latest European Innovation<br />
Scoreboard <strong>2023</strong>. As a grow<strong>in</strong>g technology<br />
hub <strong>in</strong> the Eastern Mediterranean region,<br />
the country is already home to flagship<br />
<strong>in</strong>ternational tech companies, which<br />
have chosen to make full use of the many<br />
competitive advantages, <strong>in</strong>clud<strong>in</strong>g the<br />
attractive IP regime.<br />
IA grow<strong>in</strong>g number of <strong>UK</strong><br />
and schemes, <strong>in</strong>clud<strong>in</strong>g<br />
<strong>in</strong>vestment funds.<br />
companies and <strong>in</strong>vestors are<br />
expand<strong>in</strong>g their operations <strong>in</strong><br />
<strong>Cyprus</strong>, through participation<br />
<strong>in</strong> large-scale or <strong>in</strong>frastructure<br />
projects, corporate entities<br />
and various f<strong>in</strong>ancial vehicles
DOING BUSINESS C YPRUS<br />
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UNITED KINGDOM EDITION<br />
The <strong>Cyprus</strong> Government has launched<br />
a national strategy to transform the island<br />
<strong>in</strong>to a regional hub for these fast-grow<strong>in</strong>g<br />
sectors, by attract<strong>in</strong>g <strong>in</strong>vestors and<br />
human capital wish<strong>in</strong>g to target markets<br />
<strong>in</strong> Europe, MENA and the Far East. In<br />
this context, the <strong>Bus<strong>in</strong>ess</strong> Facilitation<br />
Unit that operates at the M<strong>in</strong>istry of<br />
Energy, Commerce and Industry, serves<br />
as a dedicated po<strong>in</strong>t of s<strong>in</strong>gle contact for<br />
foreign companies active or sett<strong>in</strong>g up on<br />
the island.<br />
IThe <strong>UK</strong> is one of the most<br />
important economic partners for<br />
<strong>Cyprus</strong> and the biggest export<br />
market for Cypriot products.<br />
Overall, social, economic and<br />
political ties between the<br />
two countries run deep.<br />
These are developments that present a great opportunity for both British and<br />
Cypriot <strong>in</strong>terests due to the <strong>UK</strong>’s extended expertise <strong>in</strong> these fields. The British bus<strong>in</strong>ess<br />
community can choose to reach new markets either through collaboration with Cypriot<br />
entities or by establish<strong>in</strong>g a base <strong>in</strong> <strong>Cyprus</strong>, whereas the two countries can utilise<br />
synergies and cooperate <strong>in</strong> the production of unique or high-end products for niche<br />
markets, such as pharmaceuticals, build<strong>in</strong>g materials and artisan foodstuff.<br />
In any case, the <strong>UK</strong> is one of the most important economic partners for <strong>Cyprus</strong> and<br />
the biggest export market for Cypriot products. Overall, social, economic and political<br />
ties between the two countries run deep and even after Brexit, the <strong>UK</strong> and <strong>Cyprus</strong><br />
have been cooperat<strong>in</strong>g very closely through their participation <strong>in</strong> the Commonwealth.<br />
A Double Taxation Agreement is also <strong>in</strong> effect and bilateral agreements are <strong>in</strong> place<br />
to ensure the cont<strong>in</strong>uation and advancement of our bilateral relations, for <strong>in</strong>stance<br />
<strong>in</strong> 2022 the two countries signed an MoU for closer cooperation, <strong>in</strong>ter alia, <strong>in</strong> climate<br />
change action, the economy and education. n
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With more than 10,000 colleagues <strong>in</strong> 125 offices across 86 jurisdictions,<br />
all work<strong>in</strong>g to the same high standards of service and security, we provide<br />
our clients with local expertise where it is needed most. Our locations cover<br />
92% of world GDP and 95% of FDI <strong>in</strong>flow.<br />
We are a key part of our clients’ governance, provid<strong>in</strong>g the account<strong>in</strong>g, tax,<br />
payroll, fund adm<strong>in</strong>istration and legal entity management services essential<br />
to their success. We make sure rules are followed, reputations protected<br />
and operational compliance ma<strong>in</strong>ta<strong>in</strong>ed.<br />
Our global service model and technology platform put our clients <strong>in</strong> control<br />
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DOING BUSINESS C YPRUS<br />
24<br />
UNITED KINGDOM EDITION<br />
FOREIGN DIRECT INVESTMENT<br />
Secure EU<br />
Investment<br />
Dest<strong>in</strong>ation<br />
<strong>Cyprus</strong> cont<strong>in</strong>ues to attract significant foreign<br />
<strong>in</strong>vestment from around the world with billions flow<strong>in</strong>g<br />
<strong>in</strong>to new projects and sectors, prov<strong>in</strong>g the island<br />
nation’s strong FDI appeal among global <strong>in</strong>vestors.<br />
core benefit of <strong>Cyprus</strong> is its geostrategic location, offer<strong>in</strong>g a secure and stable<br />
A EU environment <strong>in</strong> an often-turbulent region. These factors coupled with the<br />
<strong>in</strong>troduction of new <strong>in</strong>centives are encourag<strong>in</strong>g <strong>in</strong>creas<strong>in</strong>g numbers of companies from<br />
the region and across the world to set up headquarters on the island, solidify<strong>in</strong>g its position<br />
as an attractive gateway to both established and develop<strong>in</strong>g markets. More recently,<br />
<strong>Cyprus</strong> has also started to ga<strong>in</strong> serious traction <strong>in</strong> attract<strong>in</strong>g more <strong>in</strong>novative high-tech<br />
organisations to set up on its shores – rebrand<strong>in</strong>g itself as an emerg<strong>in</strong>g tech hub.<br />
<strong>Cyprus</strong>’ reputation as a safe place to do bus<strong>in</strong>ess has brought with it a hive of new<br />
<strong>in</strong>vestment activity <strong>in</strong> recent years, with several notable projects already implemented<br />
or <strong>in</strong> the pipel<strong>in</strong>e, strengthen<strong>in</strong>g the country’s image and foreign direct <strong>in</strong>vestment (FDI)<br />
appeal. In 2017-2021 the top three sectors for <strong>in</strong>ward FDI were real estate, <strong>in</strong>formation<br />
and communications, and professional services. These sectors have been boosted by<br />
large-scale real estate projects, luxury mar<strong>in</strong>as and tourism <strong>in</strong>frastructure, a grow<strong>in</strong>g<br />
tech sector, and the island’s attractiveness as a centre for headquarter<strong>in</strong>g. There are<br />
also emerg<strong>in</strong>g opportunities <strong>in</strong> the energy, asset management and shipp<strong>in</strong>g sectors, all<br />
of which re<strong>in</strong>force <strong>Cyprus</strong>’ status as a compell<strong>in</strong>g <strong>in</strong>vestment dest<strong>in</strong>ation.
DOING BUSINESS C YPRUS<br />
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UNITED KINGDOM EDITION<br />
STRONG REBOUND TO GROWTH<br />
Successive credit rat<strong>in</strong>g upgrades over the years and the cont<strong>in</strong>uous <strong>in</strong>troduction<br />
of new <strong>in</strong>centives have attracted billions <strong>in</strong> foreign <strong>in</strong>vestment to <strong>Cyprus</strong>, with<br />
substantial <strong>in</strong>flows from the US, non-EU countries, and Asia <strong>in</strong>clud<strong>in</strong>g the Middle East.<br />
Although hav<strong>in</strong>g withstood some serious economic shocks over the last ten years,<br />
the resilience and growth performance of <strong>Cyprus</strong> has been exceptional and even<br />
exceeded <strong>in</strong>ternational expectations. Real<br />
I<strong>Cyprus</strong> GDP growth averaged 4.6% <strong>in</strong> 2018-2022<br />
was ranked third<br />
despite the Covid-19 pandemic, the war<br />
worldwide <strong>in</strong> the recovery<br />
<strong>in</strong> Ukra<strong>in</strong>e and other related disruptions.<br />
Foreign <strong>in</strong>vestment flows have been of foreign direct <strong>in</strong>vestments<br />
significant. In the ten-year period 2013-<br />
after the pandemic.<br />
2022, net <strong>in</strong>flows (liabilities) reached €13.5<br />
billion. This <strong>in</strong>vestment was driven by equity, with data on transactions suggest<strong>in</strong>g that<br />
real estate, communications and headquarter<strong>in</strong>g all played an important role.<br />
<strong>Cyprus</strong> was ranked third worldwide <strong>in</strong> the recovery of foreign direct <strong>in</strong>vestments<br />
after the pandemic, accord<strong>in</strong>g to the country’s <strong>in</strong>vestment promotion agency, Invest<br />
<strong>Cyprus</strong>. Accord<strong>in</strong>g to the Greenfield FDI Performance Index of FDI Intelligence, direct<br />
<strong>in</strong>vestments <strong>in</strong> <strong>Cyprus</strong> showed a 150% <strong>in</strong>crease <strong>in</strong> the first half of 2022, compared to<br />
the correspond<strong>in</strong>g period <strong>in</strong> 2019. Also noteworthy is the <strong>in</strong>crease <strong>in</strong> <strong>in</strong>vestments <strong>in</strong><br />
software and IT, which reached a 600% <strong>in</strong>crease <strong>in</strong> 2022 compared to the correspond<strong>in</strong>g<br />
period <strong>in</strong> 2019.<br />
THRIVING TECH HUB<br />
IIn 2022 the country boasted<br />
almost 450 start-ups and scaleups<br />
with a comb<strong>in</strong>ed value of<br />
€3.7 billion<br />
The technology and communications<br />
sector <strong>in</strong> <strong>Cyprus</strong> has become fiercely<br />
competitive, with a number of players<br />
deploy<strong>in</strong>g cutt<strong>in</strong>g edge solutions to both<br />
<strong>in</strong>crease their local market share and<br />
generate growth through the launch of<br />
new technology and products. 5G was<br />
rolled out <strong>in</strong> 2021, mak<strong>in</strong>g <strong>Cyprus</strong> the first<br />
EU state to achieve 100% 5G coverage.<br />
<strong>Cyprus</strong> is already home to a number of<br />
major tech firms, such as NCR, Amdocs,<br />
Wargam<strong>in</strong>g, 3CX, Exness, Bolt, Thomson<br />
Reuters, Melsoft Games, Easybra<strong>in</strong><br />
and Nexters, and has ga<strong>in</strong>ed ground <strong>in</strong><br />
successfully attract<strong>in</strong>g <strong>in</strong>vestment capital<br />
<strong>in</strong> blockcha<strong>in</strong>. The country’s start-up<br />
community has been grow<strong>in</strong>g rapidly. In<br />
2021, <strong>Cyprus</strong> broke national records with<br />
€85.5 million raised by start-ups, and<br />
<strong>in</strong> 2022 the country boasted almost 450<br />
start-ups and scale-ups with a comb<strong>in</strong>ed<br />
value of €3.7 billion. With an estimated<br />
4,000 entrepreneurs, the buzz<strong>in</strong>g hub is
DOING BUSINESS C YPRUS<br />
26<br />
UNITED KINGDOM EDITION<br />
foster<strong>in</strong>g more opportunities for bus<strong>in</strong>ess angels and venture capitalists look<strong>in</strong>g to<br />
<strong>in</strong>vest risk capital <strong>in</strong> exchange for equity <strong>in</strong> promis<strong>in</strong>g bus<strong>in</strong>ess ideas. In addition,<br />
a key attraction for high-tech companies is the <strong>Cyprus</strong> Intellectual Property (IP) Box<br />
Regime, which provides a competitive maximum tax rate of 2.5% on <strong>in</strong>come earned<br />
from IP assets. <strong>Cyprus</strong>’ regime also applies to a wider range of <strong>in</strong>come compared to<br />
other European schemes, most of which restrict benefits to <strong>in</strong>come from patents and<br />
supplementary patent certificates.<br />
The year 2022 saw more global names <strong>in</strong>vest <strong>in</strong> <strong>Cyprus</strong>, with European digital<br />
neobank<strong>in</strong>g platform Revolut, valued at US$33 billion, becom<strong>in</strong>g the first entity to<br />
receive approval as a crypto-asset service provider from the <strong>Cyprus</strong> regulator. The<br />
authorisation enables Revolut to offer crypto services to its 17 million customers <strong>in</strong> the<br />
EEA out of a new crypto-asset hub <strong>in</strong> <strong>Cyprus</strong>. Revolut said its choice was down to the<br />
sophisticated regulatory regime of the country, which has already attracted the likes<br />
of Crypto.com, eToro and BitPanda. A lead<strong>in</strong>g US consumer services and applications<br />
software provider, TangoMe, also announced plans to launch offices <strong>in</strong> <strong>Cyprus</strong>. The<br />
<strong>in</strong>ternationally renowned tech company, with an annual revenue of around US$350<br />
million, will establish a strong presence <strong>in</strong> Limassol with a sizeable number of<br />
employees relocat<strong>in</strong>g to <strong>Cyprus</strong>.<br />
Another project set to boost <strong>Cyprus</strong> as a regional telecoms and data hub, was<br />
lead<strong>in</strong>g telecoms provider Cyta sign<strong>in</strong>g a €850 million venture with Greece and Saudi<br />
Arabia for the construction of the East Med Corridor (EMC) – a global digital highway<br />
l<strong>in</strong>k<strong>in</strong>g Europe with Asia. In addition, the modernisation of state <strong>in</strong>frastructure and<br />
speed<strong>in</strong>g up the adoption of cloud services <strong>in</strong> <strong>Cyprus</strong> were key targets of the sign<strong>in</strong>g<br />
of a Memorandum of Understand<strong>in</strong>g with Amazon Web Services (AWS) <strong>in</strong> 2022, a<br />
collaboration that will open up a new era of opportunities.<br />
EXPANDING EDUCATION AND R&I<br />
<strong>Cyprus</strong> is develop<strong>in</strong>g <strong>in</strong>to a regional<br />
education and knowledge hub with<br />
the rapid expansion of tertiary education<br />
and its universities steadily climb<strong>in</strong>g up<br />
global rank<strong>in</strong>gs. The country has already<br />
established synergies with <strong>in</strong>ternational<br />
universities, most notably the University<br />
of Nicosia launch<strong>in</strong>g the island’s first<br />
degree programme <strong>in</strong> medic<strong>in</strong>e <strong>in</strong><br />
collaboration with St George’s Medical<br />
School at the University of London,<br />
and University of Central Lancashire –<br />
IDirect <strong>in</strong>vestments <strong>in</strong><br />
<strong>Cyprus</strong> showed a<br />
150% <strong>in</strong>crease<br />
<strong>in</strong> the first half of 2022
DOING BUSINESS C YPRUS<br />
27<br />
UNITED KINGDOM EDITION<br />
4th<br />
IN EMERGING EUROPE<br />
11th<br />
GLOBALLY<br />
<strong>Cyprus</strong> is one of the top<br />
overachievers <strong>in</strong> the Greenfield<br />
FDI Performance Index of <strong>2023</strong><br />
3rd<br />
worldwide <strong>in</strong> the post-pandemic<br />
recovery of foreign<br />
direct <strong>in</strong>vestments<br />
€4.6<br />
billion<br />
direct and <strong>in</strong>direct economic<br />
impact of the <strong>Cyprus</strong> ICT<br />
sector at the end of 2022<br />
á600%<br />
<strong>in</strong>crease <strong>in</strong> software and<br />
IT <strong>in</strong>vestments <strong>in</strong> <strong>Cyprus</strong><br />
between 2019 and 2022<br />
Source: FDI Intelligence<br />
Source: FDI Intelligence<br />
IIn 2017-2021 the top three sectors<br />
<strong>Cyprus</strong> (UCLan), be<strong>in</strong>g the first British<br />
university to establish a campus on the<br />
island. This has s<strong>in</strong>ce been followed by for <strong>in</strong>ward FDI were real estate,<br />
the American University of Beirut (AUB),<br />
<strong>in</strong>formation and communications,<br />
which established a €29 million campus<br />
<strong>in</strong> Paphos <strong>in</strong> <strong>2023</strong> – branded AUB- and professional services.<br />
Mediterraneo. The aim is to accommodate over 2,000 students <strong>in</strong> the com<strong>in</strong>g years.<br />
<strong>Cyprus</strong> hosts an impressive and fast-grow<strong>in</strong>g R&I ecosystem, featur<strong>in</strong>g high quality<br />
academic and research <strong>in</strong>stitutions and seven Centres of Excellence (CoE). The <strong>Cyprus</strong><br />
Institute has established itself as a significant research <strong>in</strong>stitute with global networks<br />
of excellence supported by significant EU fund<strong>in</strong>g. The number of foreign students<br />
choos<strong>in</strong>g <strong>Cyprus</strong> for their studies has almost tripled <strong>in</strong> the last five years, represent<strong>in</strong>g<br />
over 60 different countries and support<strong>in</strong>g the growth of <strong>Cyprus</strong> <strong>in</strong>to a true global<br />
educational centre. This fact underl<strong>in</strong>es the great opportunities that exist <strong>in</strong> <strong>Cyprus</strong> for<br />
the establishment of new universities, colleges and <strong>in</strong>stitutes.
DOING BUSINESS C YPRUS<br />
28<br />
UNITED KINGDOM EDITION<br />
PORTS AND SHIPPING<br />
The 2017 commercialisation of the country’s largest port <strong>in</strong> Limassol marked a<br />
new era for <strong>Cyprus</strong> as a commercial hub. The port privatisation came amidst the<br />
first discovery of natural gas <strong>in</strong> 2011, the launch of the €300 million VTTV oil trad<strong>in</strong>g<br />
term<strong>in</strong>al <strong>in</strong> 2014, and a dedicated Shipp<strong>in</strong>g Deputy M<strong>in</strong>ister <strong>in</strong> 2018. The privatisation<br />
deal with Eurogate International GmbH and lead<strong>in</strong>g Emirati logistics giant DP World<br />
Limited is projected to boost state coffers with €2 billion over the next 25 years, while<br />
the new port operators have <strong>in</strong>jected millions <strong>in</strong> upgrad<strong>in</strong>g services and <strong>in</strong>frastructure.<br />
Larnaca port is expected to have a new term<strong>in</strong>al by 2027. The contract for the Larnaca<br />
IThe growth of <strong>Cyprus</strong>’ resident<br />
port and mar<strong>in</strong>a was awarded to Kition<br />
Ocean Hold<strong>in</strong>gs Ltd, a Cypriot-Israeli<br />
consortium compris<strong>in</strong>g Eldeman Hold<strong>in</strong>g shipp<strong>in</strong>g sector over the<br />
BV and Alexandrou Corporate Services<br />
past 50 years has developed<br />
Ltd, <strong>in</strong> late 2020 and Phase 1 works will<br />
beg<strong>in</strong> <strong>in</strong> 2024. The mar<strong>in</strong>a is expected to a strong maritime cluster<br />
attract around €1.2 billion <strong>in</strong> construction<br />
that caters to the needs of<br />
and real estate development – mak<strong>in</strong>g<br />
it one of the biggest <strong>in</strong>frastructure <strong>Cyprus</strong>-based companies,<br />
<strong>in</strong>vestments to date <strong>in</strong> <strong>Cyprus</strong>.<br />
<strong>in</strong>clud<strong>in</strong>g bank<strong>in</strong>g, professional<br />
One of <strong>Cyprus</strong>’ most successful export<br />
services has been the maritime <strong>in</strong>dustry, services, <strong>in</strong>surance, and IT.<br />
which now has a dedicated Deputy<br />
M<strong>in</strong>istry of Shipp<strong>in</strong>g. The growth of <strong>Cyprus</strong>’ resident shipp<strong>in</strong>g sector over the past 50<br />
years has developed a strong maritime cluster that caters to the needs of <strong>Cyprus</strong>-based<br />
companies, <strong>in</strong>clud<strong>in</strong>g bank<strong>in</strong>g, professional services, <strong>in</strong>surance, and IT. The cluster<br />
is consistently attract<strong>in</strong>g more quality tonnage and shipp<strong>in</strong>g-related companies to<br />
its shores. Between 2010 – when the <strong>Cyprus</strong> tonnage tax system was approved by the<br />
European Commission – and 2021, there has been more than a fivefold <strong>in</strong>crease <strong>in</strong> the<br />
number of shipp<strong>in</strong>g companies that have registered with <strong>Cyprus</strong>’ specialised shipp<strong>in</strong>g<br />
taxation system, boost<strong>in</strong>g the sector’s revenue by around 25%. Also, a new limited
DOING BUSINESS C YPRUS<br />
30<br />
UNITED KINGDOM EDITION<br />
liability shipp<strong>in</strong>g company law was adopted <strong>in</strong> October 2022, allow<strong>in</strong>g for streaml<strong>in</strong>ed<br />
services via the Deputy Shipp<strong>in</strong>g M<strong>in</strong>istry.<br />
The shipp<strong>in</strong>g cluster has been grow<strong>in</strong>g with new entrants relocat<strong>in</strong>g to <strong>Cyprus</strong>. Some<br />
examples <strong>in</strong>clude the decision <strong>in</strong> 2022 by lead<strong>in</strong>g oil tanker company Frontl<strong>in</strong>e to move<br />
from Bermuda to <strong>Cyprus</strong>, and the move <strong>in</strong> 2018 by lead<strong>in</strong>g London ship <strong>in</strong>surer P&I Club<br />
to open a post-Brexit EU subsidiary <strong>in</strong> <strong>Cyprus</strong>, reaffirm<strong>in</strong>g the island’s position as one<br />
of the top global hubs for shipp<strong>in</strong>g. Another triumph came <strong>in</strong> early 2019, when British<br />
shipp<strong>in</strong>g firm P&O Ferries decided to register its English Channel operat<strong>in</strong>g fleet<br />
under the <strong>Cyprus</strong> flag to take advantage of the benefits and security it provides. When<br />
it comes to shipmanagement, all the large ship managers have offices <strong>in</strong> <strong>Cyprus</strong>. Two<br />
of the <strong>in</strong>dustry’s most highly respected privately-owned shipmanagement companies,<br />
Columbia Shipmanagement and Marlow Navigation – both based <strong>in</strong> <strong>Cyprus</strong> – merged<br />
<strong>in</strong> 2017 to form Columbia Marlow, creat<strong>in</strong>g one of the world’s largest ship and crewmanagement<br />
companies. Another FDI transaction was the 2018 buyout of Limassolbased<br />
Songa Offshore SE by Transocean Ltd, the world’s largest offshore drill<strong>in</strong>g<br />
contractor for oil and gas wells, <strong>in</strong> a deal worth US$3.4 billion. In addition, natural<br />
gas f<strong>in</strong>ds with<strong>in</strong> <strong>Cyprus</strong>’ Exclusive Economic Zone (EEZ) and efforts to exploit it <strong>in</strong><br />
cooperation with neighbour<strong>in</strong>g countries have expanded opportunities for the island’s<br />
already thriv<strong>in</strong>g shipp<strong>in</strong>g sector.<br />
NEW ENERGY OPPORTUNITIES<br />
C<br />
yprus’ hydrocarbons discoveries captured the attention of global energy<br />
heavyweights when US company Noble Energy, now acquired by US giant Chevron,<br />
made the first natural gas discovery <strong>in</strong> 2011 with estimated resources of 4.5 trillion<br />
cubic feet (tcf) <strong>in</strong> the offshore Aphrodite field <strong>in</strong> Block 12. Chevron owns the licence to<br />
Aphrodite <strong>in</strong> consortium with Shell and NewMed, while ExxonMobil and Qatar Energy<br />
hold licences <strong>in</strong> Blocks 5 and 10.
DOING BUSINESS C YPRUS<br />
31<br />
UNITED KINGDOM EDITION<br />
ENI of Italy and Total Energies of France hold the largest number of licences (Blocks<br />
2, 3, 6, 7, 8, 9 and 11) while Kogas of South Korea shares the licences with ENI and Total<br />
(Blocks 2, 3 and 9).<br />
ExxonMobil announced the discovery of an estimated 5 to 8 tcf <strong>in</strong> ‘Glaucus-1’ of<br />
Block 10 <strong>in</strong> 2019, while ENI confirmed Block 6 discoveries of around 2.5 tcf <strong>in</strong> ‘Cronos-1’<br />
and 2-3.5 tcf <strong>in</strong> ‘Zeus-1’ <strong>in</strong> late 2022. Further drill<strong>in</strong>g has taken place and updates and<br />
confirmations of discoveries could be announced with<strong>in</strong> the next year, <strong>in</strong>clud<strong>in</strong>g a f<strong>in</strong>al<br />
decision on the development of Aphrodite.<br />
In addition to offshore discoveries <strong>in</strong> the last decade, a range of other new energy<br />
opportunities have come to the fore. In December 2019, <strong>Cyprus</strong> signed a landmark<br />
deal with a Ch<strong>in</strong>ese-led consortium to build a €290 million LNG import term<strong>in</strong>al at<br />
Vassilikos. The consortium construct<strong>in</strong>g the project <strong>in</strong>cludes Ch<strong>in</strong>a Petroleum Pipel<strong>in</strong>e<br />
Eng<strong>in</strong>eer<strong>in</strong>g Co. Ltd, Metron SA, Hudong-Zhonghua Shipbuild<strong>in</strong>g and Wilhelmsen<br />
Ship Management. The term<strong>in</strong>al will <strong>in</strong>clude a float<strong>in</strong>g storage and regasification<br />
unit (FSRU), a jetty for moor<strong>in</strong>g the FSRU and related <strong>in</strong>frastructure at Vassilikos. The<br />
FSRU, expected to be completed by the end of 2024, attracted €150 million <strong>in</strong> f<strong>in</strong>ance<br />
from the European Investment Bank (EIB), €80 million from the European Bank for<br />
Reconstruction and Development (EBRD), €101 million from the EU’s Connect<strong>in</strong>g<br />
Europe Facility as well as an equity contribution of €43 million from the Electricity<br />
Authority of <strong>Cyprus</strong> (EAC).<br />
Parallel to this, <strong>Cyprus</strong> has been ramp<strong>in</strong>g up its renewables and storage capacity,<br />
with support from the EU’s €1.2 billion Recovery and Resilience Facility (RFF). The<br />
renewable energy sector could be one of<br />
the most attractive areas for <strong>in</strong>vestment<br />
I<strong>Cyprus</strong> has been ramp<strong>in</strong>g up<br />
its renewables and storage<br />
capacity, with support from<br />
the EU’s €1.2 billion Recovery<br />
and Resilience Facility (RFF).<br />
and jo<strong>in</strong>t ventures with other countries.<br />
For example, the UAE and Saudi Arabia<br />
have been pioneers <strong>in</strong> clean energy,<br />
especially <strong>in</strong> the field of hydrogen, and<br />
are keen to export its RES know-how and<br />
create synergies. Saudi Arabia – dubbed
DOING BUSINESS C YPRUS<br />
32<br />
UNITED KINGDOM EDITION<br />
to become one of the biggest producers of clean energy – could support the EU’s<br />
hydrogen strategy through <strong>Cyprus</strong> as an <strong>in</strong>terconnector to Saudi’s biggest hydrogen<br />
production plant currently under construction.<br />
The long-awaited full liberalisation of the electricity production market <strong>in</strong> <strong>Cyprus</strong><br />
has seen many delays, but once this materialises it would allow a fresh <strong>in</strong>flow of new<br />
private players operat<strong>in</strong>g <strong>in</strong> both renewables and gas to compete <strong>in</strong> the local market<br />
– and <strong>in</strong> a broader regional market, thanks to the EuroAsia Interconnector project to<br />
connect <strong>Cyprus</strong>, Israel and Greece via a submar<strong>in</strong>e electricity cable along with the<br />
related EuroAfrica Interconnector to connect Egypt.<br />
STABLE BANKING AND RISING INVESTMENT FUNDS<br />
<strong>Cyprus</strong> banks ma<strong>in</strong>ta<strong>in</strong> high levels of<br />
capital adequacy and liquidity and<br />
have cut their non-perform<strong>in</strong>g loan (NPL)<br />
ratios to s<strong>in</strong>gle digits. The restructur<strong>in</strong>g<br />
of the bank<strong>in</strong>g sector after 2013 attracted<br />
important <strong>in</strong>ternational <strong>in</strong>stitutional<br />
<strong>in</strong>vestors and fresh foreign capital and<br />
encouraged accelerated sales of NPLs.<br />
These developments substantially<br />
reduced risk and enabled the f<strong>in</strong>ancial<br />
system to operate on a healthier basis.<br />
The island also hosts a thriv<strong>in</strong>g forex<br />
<strong>in</strong>dustry with many global giants bas<strong>in</strong>g<br />
their operational headquarters <strong>in</strong> <strong>Cyprus</strong>.<br />
In addition, the <strong>in</strong>vestment funds sector<br />
has grown exponentially <strong>in</strong> the last few<br />
IThe restructur<strong>in</strong>g of the<br />
years with Assets under Management<br />
(AuM) see<strong>in</strong>g a stagger<strong>in</strong>g <strong>in</strong>crease from<br />
€2.7 billion <strong>in</strong> 2016 to €10.7 billion <strong>in</strong> the second quarter of <strong>2023</strong>, prov<strong>in</strong>g <strong>Cyprus</strong> is<br />
be<strong>in</strong>g recognised by the global asset management community. Investment funds have<br />
already <strong>in</strong>vested more than €2.5 billion <strong>in</strong> several sectors of the Cypriot economy, such<br />
as shipp<strong>in</strong>g, hospitality, education, healthcare, and renewable energy.<br />
TOURISM AND HIGH-END REAL ESTATE<br />
bank<strong>in</strong>g sector after<br />
2013 attracted important<br />
<strong>in</strong>ternational <strong>in</strong>stitutional<br />
<strong>in</strong>vestors and fresh foreign<br />
capital and encouraged<br />
accelerated sales of NPLs.<br />
These developments<br />
substantially reduced risk and<br />
enabled the f<strong>in</strong>ancial system to<br />
operate on a healthier basis.<br />
<strong>Cyprus</strong> cont<strong>in</strong>ues to be on the top of the list for <strong>in</strong>vestors, holiday-home seekers,<br />
expats and retirees. Tourism and real estate have always been robust sectors of the<br />
Cypriot economy, and a concerted effort to diversify <strong>Cyprus</strong>’ offer<strong>in</strong>g <strong>in</strong> recent years<br />
has paid off. The number of foreign <strong>in</strong>vestors clos<strong>in</strong>g multimillion-euro deals <strong>in</strong> the last<br />
several years underl<strong>in</strong>es the fact that tourism-related real estate and <strong>in</strong>frastructure<br />
cont<strong>in</strong>ues to be one of the most attractive <strong>in</strong>vestment opportunities <strong>in</strong> <strong>Cyprus</strong>. Total<br />
sales <strong>in</strong> 2022 reached more than €4.2 billion.<br />
Pre-pandemic years of record-break<strong>in</strong>g tourism numbers saw the island attract<br />
new <strong>in</strong>terest <strong>in</strong> conference, sports, health and wellness tourism. The construction and<br />
<strong>in</strong>vestment <strong>in</strong> multipurpose projects and mixed-use developments such as luxury<br />
mar<strong>in</strong>as, golf courses and more recently the island’s first-ever and only <strong>in</strong>tegrated<br />
luxury cas<strong>in</strong>o resort, are all part of the ongo<strong>in</strong>g strategy to upgrade <strong>Cyprus</strong>’ tourism
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DOING BUSINESS C YPRUS<br />
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UNITED KINGDOM EDITION<br />
Artist Impression: City of Dreams Mediterranean<br />
Artist Impression: Grand Hyatt Limassol<br />
Artist Impression: Ritz-Carlton Residences<br />
ITourism and real estate have<br />
product. The new cas<strong>in</strong>o resort, City<br />
of Dreams Mediterranean, has extensive<br />
always been robust sectors<br />
facilities and five-star status. The cas<strong>in</strong>o<br />
resort is Hong Kong-based Melco’s first<br />
of the Cypriot economy,<br />
expansion outside of Asia and is the<br />
and a concerted effort to<br />
biggest cas<strong>in</strong>o of its k<strong>in</strong>d <strong>in</strong> Europe, with<br />
the <strong>in</strong>vestment of €600 million for this<br />
diversify <strong>Cyprus</strong>’ offer<strong>in</strong>g <strong>in</strong><br />
mega project.<br />
recent years has paid off.<br />
Spurred by this unique development,<br />
<strong>Cyprus</strong> garnered another landmark<br />
<strong>in</strong>vestment deal <strong>in</strong> 2022 with Israeli bus<strong>in</strong>ess magnate Gilad Shabtai <strong>in</strong>vest<strong>in</strong>g <strong>in</strong> over<br />
130,000 m 2 of land for development surround<strong>in</strong>g the new <strong>in</strong>tegrated cas<strong>in</strong>o resort <strong>in</strong><br />
Limassol. The dest<strong>in</strong>ation and value of the area are set to be elevated by this key real<br />
estate <strong>in</strong>vestment.<br />
Proposals <strong>in</strong>clude the development of exclusive seven-star facilities provid<strong>in</strong>g<br />
bespoke services for owners and <strong>in</strong>vestors. Plans are also <strong>in</strong> place for additional
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UNITED KINGDOM EDITION<br />
<strong>in</strong>vestment by the former majority shareholder of telecoms start-up Viber <strong>in</strong>to the<br />
further expansion of the area <strong>in</strong> the future – which is a solid vote of confidence <strong>in</strong> the<br />
vast growth potential of <strong>Cyprus</strong>.<br />
Follow<strong>in</strong>g the success of Limassol Mar<strong>in</strong>a, more <strong>in</strong>vestment has flowed <strong>in</strong>to mar<strong>in</strong>a<br />
developments on the Cypriot coast. The €300 million luxury Ayia Napa Mar<strong>in</strong>a is under<br />
construction with berth<strong>in</strong>g facilities and a commercial village now fully operational.<br />
The mar<strong>in</strong>a offers capacity for 600 yachts of up to 60 metres, a shipyard, and a range of<br />
luxury villas, apartments and facilities. With significant Egyptian <strong>in</strong>vestment back<strong>in</strong>g<br />
the <strong>in</strong>novative project and the seafront residences are expected to be completed by<br />
<strong>2023</strong>. In addition, the €110 million Paralimni Mar<strong>in</strong>a project is set to be completed <strong>in</strong><br />
2024, while a tender was signed <strong>in</strong> August 2021 with Deloitte Ltd and Triton Consult<strong>in</strong>g<br />
Eng<strong>in</strong>eers SA for a luxury mar<strong>in</strong>a <strong>in</strong> Paphos.<br />
Major <strong>in</strong>vestments have also been made <strong>in</strong> the hospitality <strong>in</strong>dustry with acquisitions<br />
and the construction of new luxury hotels by renowned hotel management cha<strong>in</strong>s. The<br />
Radisson Hotel Group, one of the largest and most dynamic hotel groups <strong>in</strong> the world,<br />
has big plans to grow its exist<strong>in</strong>g portfolio <strong>in</strong> the country to six hotels and almost 1,000<br />
rooms by 2025, one of which is the Radisson Larnaca Beach Resort, the very first beach<br />
resort by the Radisson Hotel Group worldwide.<br />
In 2019, the Luxury Collection, part of Marriott International, opened the Parklane<br />
Luxury Collection Resort & Spa <strong>in</strong> Limassol, mark<strong>in</strong>g Marriott International’s entry <strong>in</strong>to<br />
<strong>Cyprus</strong>. In July 2020, Hyatt Hotels Corporation announced a management agreement<br />
with Anolia Hold<strong>in</strong>gs Limited for the launch of the first Hyatt hotel <strong>in</strong> <strong>Cyprus</strong>. The<br />
300-room luxury resort Grand Hyatt Limassol is expected to open <strong>in</strong> 2025. The new<br />
beachfront resort will also be a key element of Zaria Resort, a mixed-use luxury<br />
development, comprised of residential apartments and private villas totall<strong>in</strong>g more<br />
than 80,000 m 2 . Israeli conglomerate Fattal Group has also been expand<strong>in</strong>g its portfolio<br />
<strong>in</strong> <strong>Cyprus</strong> <strong>in</strong> <strong>2023</strong>, and currently manages n<strong>in</strong>e hotel units on the island and has<br />
<strong>in</strong>vested more than €300 million <strong>in</strong> <strong>Cyprus</strong>' tourism sector. The legendary Berengaria<br />
Hotel <strong>in</strong> the Troodos Mounta<strong>in</strong>s is also be<strong>in</strong>g restored by bbf Group and Thanos Hotels<br />
& Resorts with an <strong>in</strong>vestment of €35 million. The completion of the hotel, which will be<br />
named Berengaria Luxury Boutique Hotel, is expected <strong>in</strong> 2026.<br />
Follow<strong>in</strong>g global trends and faced with an ag<strong>in</strong>g population, <strong>in</strong>vest<strong>in</strong>g <strong>in</strong> health and<br />
wellness developments as well as rehabilitation and bespoke retirement villages has<br />
enormous potential. An early example of this is the Eden Seniors Resort <strong>in</strong> Larnaca<br />
which opened its doors <strong>in</strong> 2018. Paphos is due to see the first dedicated retirement village<br />
<strong>in</strong> <strong>Cyprus</strong>. The €16 million retirement village, branded Lazaris Mill, will consist of 82<br />
<strong>in</strong>dividual apartments, rang<strong>in</strong>g from studios to larger flats and a small 24-room hotel,<br />
and provide bespoke facilities. Another upcom<strong>in</strong>g project <strong>in</strong> Paphos is Cypress Park, a<br />
new luxury residential development turn<strong>in</strong>g retirement <strong>in</strong>to a five-star resort stay.<br />
SOLID INVESTOR SUPPORT<br />
<strong>Cyprus</strong> has been steadily sharpen<strong>in</strong>g its competitive edge by streaml<strong>in</strong><strong>in</strong>g processes<br />
to better cater to <strong>in</strong>vestors and by strengthen<strong>in</strong>g new sectors to support its already<br />
more established <strong>in</strong>dustries. Investment<br />
opportunities <strong>in</strong> <strong>Cyprus</strong>’ large-scale<br />
projects span various sectors, <strong>in</strong>clud<strong>in</strong>g<br />
high-value tourism and hous<strong>in</strong>g <strong>Cyprus</strong>’ large-scale projects<br />
developments, projects with a special<br />
IInvestment opportunities <strong>in</strong><br />
span various sectors
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UNITED KINGDOM EDITION<br />
focus on golf courses and luxury mar<strong>in</strong>as, as well as education, energy, and more<br />
recently, the <strong>in</strong>ternational film sector.<br />
Special schemes and <strong>in</strong>centives are <strong>in</strong> place to facilitate headquarter<strong>in</strong>g, which<br />
covers the sectors of technology, asset management, <strong>in</strong>vestment funds, shipp<strong>in</strong>g and<br />
higher education, and ‘Olivewood’ for the <strong>in</strong>ternational film <strong>in</strong>dustry. A new government<br />
Action Plan has launched fresh <strong>in</strong>centives to attract non-EU talent and companies to<br />
establish operations <strong>in</strong> <strong>Cyprus</strong>. The recent <strong>in</strong>troduction of a <strong>Bus<strong>in</strong>ess</strong> Facilitation Unit<br />
(BFU), together with a digital nomad visa, promises to be a gamechanger for ease of<br />
sett<strong>in</strong>g up <strong>in</strong> <strong>Cyprus</strong>. With a particular focus on high-tech and <strong>in</strong>novative companies,<br />
pharmaceuticals and shipp<strong>in</strong>g, the BFU specialises <strong>in</strong> fast-track<strong>in</strong>g bus<strong>in</strong>ess setup,<br />
permitt<strong>in</strong>g and licens<strong>in</strong>g for companies, their employees and families.<br />
To better facilitate FDI, the country’s <strong>in</strong>vestment promotion agency, Invest <strong>Cyprus</strong>,<br />
has also developed an onl<strong>in</strong>e <strong>in</strong>vestment matchmak<strong>in</strong>g platform branded the Project<br />
Bank, to help <strong>in</strong>vestors identify the right market opportunities for projects based <strong>in</strong><br />
<strong>Cyprus</strong>.<br />
ATTRACTIVE INVESTMENT LOCATION<br />
C<br />
yprus’ liberalised FDI Policy, both for EU citizens and <strong>in</strong>vestors from third countries,<br />
along with its favourable tax regime makes it one of the most attractive <strong>in</strong>vestment<br />
targets <strong>in</strong> Europe. At 12.5% <strong>Cyprus</strong>’ corporate tax rate is one of the most competitive <strong>in</strong><br />
the EU and new tax-neutral reforms that are on the way will simplify and modernise<br />
the tax system further. The country’s extensive network of double taxation treaties<br />
with 68 countries have strengthened its position as a bus<strong>in</strong>ess gateway and a preferred<br />
location for corporate headquarters. The country’s skilled talent, low cost of do<strong>in</strong>g<br />
bus<strong>in</strong>ess, top-tier professional services, and high quality of life renders <strong>Cyprus</strong> not only<br />
a wise bus<strong>in</strong>ess and <strong>in</strong>vestment choice but also a great relocation dest<strong>in</strong>ation. n
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UNITED KINGDOM EDITION<br />
CYPRUS-<strong>UK</strong> RELATIONS<br />
C<br />
yprus has a strong bilateral relationship with the United K<strong>in</strong>gdom,<br />
reflect<strong>in</strong>g the two countries’ long historical ties which date back to the<br />
19 th century. <strong>Cyprus</strong> ga<strong>in</strong>ed its <strong>in</strong>dependence from the United K<strong>in</strong>gdom <strong>in</strong><br />
1960, after 82 years of British control, however the <strong>UK</strong> cont<strong>in</strong>ues to have<br />
British Overseas Territory <strong>in</strong> <strong>Cyprus</strong> – the Sovereign Base Areas (SBAs) <strong>in</strong><br />
Akrotiri and Dhekelia which <strong>in</strong>clude British military bases.<br />
Today, the two countries ma<strong>in</strong>ta<strong>in</strong> close l<strong>in</strong>ks <strong>in</strong> the political, economic,<br />
and cultural fields. These are enhanced further through the strong position of<br />
<strong>Cyprus</strong> as member of the European Union and the Commonwealth. The<br />
United K<strong>in</strong>gdom is also one of the guarantor powers of <strong>Cyprus</strong>’ <strong>in</strong>dependence<br />
and territorial <strong>in</strong>tegrity and is committed to a comprehensive settlement <strong>in</strong><br />
<strong>Cyprus</strong>.<br />
<strong>Cyprus</strong> and the <strong>UK</strong> have entered <strong>in</strong>to a number of bilateral agreements<br />
and memoranda which solidify their cooperation even further. The<br />
Memorandum of Understand<strong>in</strong>g (MoU) on Establish<strong>in</strong>g a Strategic<br />
Cooperation, which was signed <strong>in</strong> November 2022, seeks to put <strong>in</strong> place a<br />
more structured bilateral strategic cooperation <strong>in</strong> various fields, such as<br />
foreign and regional policy, security, trade, education, maritime, climate<br />
and crime. The two countries have also signed a Double Taxation Agreement<br />
(DTA) for the elim<strong>in</strong>ation of double taxation with respect to taxes on <strong>in</strong>come<br />
and capital ga<strong>in</strong>s and the prevention of tax evasion and avoidance. Another<br />
significant MoU was signed at the beg<strong>in</strong>n<strong>in</strong>g of <strong>2023</strong> to lay a solid foundation<br />
for the further expansion of bilateral cooperation <strong>in</strong> all important aspects of<br />
shipp<strong>in</strong>g.<br />
In addition, the two countries ma<strong>in</strong>ta<strong>in</strong> strong personal ties. It is<br />
estimated that there are around 300,000 Cypriots liv<strong>in</strong>g <strong>in</strong> the <strong>UK</strong> and over<br />
10,000 Cypriot students are currently enrolled <strong>in</strong> British universities. At the<br />
same time, there are around 30,000 Britons liv<strong>in</strong>g <strong>in</strong> the Republic of <strong>Cyprus</strong><br />
– constitut<strong>in</strong>g the largest British migrant community <strong>in</strong> the region. Also,<br />
more than 1 million British tourists visit the island every year, represent<strong>in</strong>g a<br />
significant proportion of tourist arrivals to <strong>Cyprus</strong>.<br />
The <strong>UK</strong> is one of the most important economic partners for <strong>Cyprus</strong> and<br />
the biggest export market for Cypriot products – not just <strong>in</strong> goods but also<br />
<strong>in</strong> services. It is also an important source of foreign direct <strong>in</strong>vestment. The<br />
major sectors, by economic activity, that attracted foreign <strong>in</strong>vestments<br />
were real estate, f<strong>in</strong>ancial and <strong>in</strong>surance activities, as well as various<br />
professional, scientific, and technical activities. Post Brexit, the robust<br />
bilateral relationship between <strong>Cyprus</strong> and the <strong>UK</strong> has cont<strong>in</strong>ued to<br />
strengthen considerably as <strong>Cyprus</strong> can serve as an ideal and familiar EU<br />
base for British <strong>in</strong>vestors. As a result, a grow<strong>in</strong>g number of <strong>UK</strong> companies<br />
and <strong>in</strong>vestors have been expand<strong>in</strong>g their operations <strong>in</strong> <strong>Cyprus</strong> through<br />
participation <strong>in</strong> large-scale or <strong>in</strong>frastructure projects, corporate entities<br />
and various f<strong>in</strong>ancial vehicles and schemes, <strong>in</strong>clud<strong>in</strong>g <strong>in</strong>vestment funds.<br />
The overall relationship between <strong>Cyprus</strong> and the <strong>UK</strong>, <strong>in</strong>clud<strong>in</strong>g the bus<strong>in</strong>ess<br />
and trade l<strong>in</strong>ks, will cont<strong>in</strong>ue to flourish and benefit both countries.
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UNITED KINGDOM EDITION<br />
INSIGHT<br />
M<strong>in</strong>ister of Foreign Affairs<br />
Constant<strong>in</strong>os<br />
Kombos<br />
The <strong>UK</strong> is an important and strategic ally for<br />
<strong>Cyprus</strong>. What are the key pillars that form this<br />
strong relationship and how do you see this<br />
bilateral partnership develop<strong>in</strong>g <strong>in</strong> the future?
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UNITED KINGDOM EDITION<br />
The relationship between <strong>Cyprus</strong> and the <strong>UK</strong> is def<strong>in</strong>ed by our common history and<br />
shared values, underp<strong>in</strong>ned by the close and steadfast people-to-people contacts,<br />
and a mutually beneficial cooperation on a wide range of areas, both on a bilateral and<br />
multilateral level.<br />
Our ties date back to the 12th century when Richard the Lionheart landed <strong>in</strong> <strong>Cyprus</strong> <strong>in</strong><br />
search of his sister and his bride Berengaria. Despite difficult and turbulent moments<br />
<strong>in</strong> our history, our countries cont<strong>in</strong>ue to enjoy a strong, pragmatic, and deeply rooted<br />
relationship with immense potential. Notable areas of our bilateral ties <strong>in</strong>clude<br />
education, bus<strong>in</strong>ess, services and trade. Cooperation also extends to security and<br />
defence, which becomes even more important <strong>in</strong> the current turbulent geopolitical<br />
environment.<br />
In fact, over the last decade, bilaterally and through our countries’ participation<br />
<strong>in</strong> the Coalition aga<strong>in</strong>st ISIS, <strong>Cyprus</strong> and the <strong>UK</strong> have built a close partnership <strong>in</strong> the<br />
field of security, <strong>in</strong>clud<strong>in</strong>g counterterrorism. The strength of the relationship was also<br />
evident <strong>in</strong> <strong>2023</strong> when, through the activation of the National Crisis Management Plan<br />
ESTIA, <strong>Cyprus</strong> and the <strong>UK</strong> cooperated closely for the repatriation of our nationals as<br />
well as nationals of other states, from Sudan.<br />
The important relationship that <strong>Cyprus</strong> and the <strong>UK</strong> share – and seek to develop<br />
further – was reaffirmed <strong>in</strong> November 2022 with the sign<strong>in</strong>g of a Memorandum<br />
of Understand<strong>in</strong>g, establish<strong>in</strong>g a strategic cooperation, thus illustrat<strong>in</strong>g the close<br />
partnership which exists between our two countries. The MoU opens the way for<br />
further strengthen<strong>in</strong>g and broaden<strong>in</strong>g our relationship across many areas of shared<br />
<strong>in</strong>terest. We expect to see <strong>in</strong>creased opportunities for trade, professional services,<br />
shipp<strong>in</strong>g, and green growth.<br />
IOur One of the most dynamic aspects of countries cont<strong>in</strong>ue to<br />
our relationship is, undoubtedly, the<br />
enjoy a strong, pragmatic,<br />
vibrant Cypriot community <strong>in</strong> the <strong>UK</strong>.<br />
The Cypriot diaspora <strong>in</strong> the <strong>UK</strong>, which and deeply rooted relationship<br />
amounts to more than 300,000 people,<br />
with immense potential.<br />
is the largest community of overseas<br />
Cypriots. They have been a vigorous and strong advocate of the relationship between<br />
our two countries, and <strong>in</strong> many ways cont<strong>in</strong>ue to be a vital driv<strong>in</strong>g force for our future<br />
ties. British universities have also educated thousands of Cypriots, send<strong>in</strong>g back to the<br />
island generations of Cypriot professionals who practice law, medic<strong>in</strong>e, account<strong>in</strong>g and<br />
more. Moreover, British retirees have made <strong>Cyprus</strong> their home, and actively contribute<br />
to their local communities.<br />
On a political level, we consider that our countries’ mutual commitment to peace and<br />
democracy, form the foundation of our relationship. <strong>Cyprus</strong> and the <strong>UK</strong> share common<br />
values when it comes to the adherence to <strong>in</strong>ternational law, and the promotion and<br />
protection of fundamental freedoms and human rights. Our countries are staunch<br />
advocates of the pr<strong>in</strong>ciples of the Charter of the United Nations, which <strong>in</strong>clude respect<br />
for the rules-based order and resolv<strong>in</strong>g <strong>in</strong>ternational disputes through peaceful means.<br />
It is these pr<strong>in</strong>ciples which are at the core of our efforts to reunify our country and<br />
br<strong>in</strong>g an end to the division and cont<strong>in</strong>u<strong>in</strong>g illegal Turkish occupation of <strong>Cyprus</strong>. The<br />
<strong>UK</strong>, as a permanent member of the UN Security Council, has a special role to play <strong>in</strong><br />
support<strong>in</strong>g our s<strong>in</strong>cere efforts to reach a comprehensive solution to the <strong>Cyprus</strong> Issue,<br />
on the basis of the agreed framework for a bizonal, bicommunal federation with<br />
political equality, as def<strong>in</strong>ed by relevant UN Security Council resolutions. n
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UNITED KINGDOM EDITION<br />
INTERVIEW<br />
British High Commissioner to <strong>Cyprus</strong><br />
Irfan Siddiq<br />
OBE<br />
The strong and multifaceted relationship<br />
between <strong>Cyprus</strong> and the <strong>UK</strong> will cont<strong>in</strong>ue to<br />
support and develop trade and commercial<br />
partnerships, which <strong>in</strong> turn will offer tangible<br />
economic and f<strong>in</strong>ancial benefits to the people<br />
of both countries, says Irfan Siddiq.
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UNITED KINGDOM EDITION<br />
How would you describe the current bilateral<br />
relations between the <strong>UK</strong> and <strong>Cyprus</strong>?<br />
The relationship between the <strong>UK</strong> and <strong>Cyprus</strong> has always been a very rich and active<br />
one. It is founded on historic l<strong>in</strong>ks, strong people-to-people connections, an<br />
exceptionally effective government-to-government cooperation, as well as flourish<strong>in</strong>g<br />
bus<strong>in</strong>ess and trade ties.<br />
Work<strong>in</strong>g together on issues of common <strong>in</strong>terest and mutual benefit has been a<br />
priority for both countries. This is demonstrated through a number of activities, for<br />
example our jo<strong>in</strong>t commitment to defence with visits by the Royal Navy’s flagships<br />
Queen Elizabeth and HMS Albion, and jo<strong>in</strong>t exercises with the Cypriot National Guard.<br />
We also have shared values on human rights, <strong>in</strong> particular we signed a Memorandum of<br />
Understand<strong>in</strong>g to work together to protect LGBT+ rights last year. And we are work<strong>in</strong>g<br />
together closely on specific issues such as support for victims of rape and sexual<br />
assault through tra<strong>in</strong><strong>in</strong>g visits by professionals from the <strong>UK</strong>. But there is more we can<br />
do together to benefit both our countries – particularly <strong>in</strong> the fight aga<strong>in</strong>st climate<br />
change, security, and trade.<br />
What significant key projects are there between the <strong>UK</strong><br />
and <strong>Cyprus</strong> at the moment, and what k<strong>in</strong>d of projects or<br />
cooperation would you like to see developed <strong>in</strong> the future?<br />
A<br />
s mentioned, the collaboration between our two countries covers all sectors<br />
and activities of common <strong>in</strong>terest. This is reflected <strong>in</strong> the memorandum of<br />
understand<strong>in</strong>g signed just a year ago between the <strong>UK</strong> and <strong>Cyprus</strong>. Through this<br />
agreement we enhance our bilateral collaboration <strong>in</strong> matters of foreign policy and<br />
security as well as economic, trad<strong>in</strong>g, and educational activities between the <strong>UK</strong> and<br />
<strong>Cyprus</strong>. There is currently close collaboration <strong>in</strong> implementation of the sanctions<br />
aga<strong>in</strong>st Russia, the <strong>UK</strong> government is provid<strong>in</strong>g support to <strong>Cyprus</strong> <strong>in</strong> its effort to improve<br />
its sanctions enforcement capacity and capability. There is similar collaboration <strong>in</strong><br />
projects such as justice reform and the e-government project managed by the Deputy<br />
M<strong>in</strong>istry of Research, Innovation and Digital Strategy. We are also work<strong>in</strong>g with the<br />
Deputy M<strong>in</strong>istry for Shipp<strong>in</strong>g to take forward priorities such as green shipp<strong>in</strong>g. These<br />
and other sectors such as green energy, smart cities, health, and education are areas<br />
where there is a lot more work to be done <strong>in</strong> both countries and we are look<strong>in</strong>g forward<br />
to work<strong>in</strong>g together to achieve positive results.
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UNITED KINGDOM EDITION<br />
<strong>Cyprus</strong> has been a convenient base for many<br />
British companies for decades, <strong>in</strong> your view<br />
what factors have contributed to the appeal<br />
of <strong>Cyprus</strong> as a bus<strong>in</strong>ess jurisdiction?<br />
The <strong>Cyprus</strong> market offers advantages<br />
to British companies and at the same<br />
time the <strong>UK</strong> is an attractive market<br />
for Cypriot companies to develop and<br />
grow their bus<strong>in</strong>ess activities. There are<br />
some common positive factors <strong>in</strong> both<br />
markets such as the use of Common Law,<br />
availability of well-tra<strong>in</strong>ed and highly<br />
IFor <strong>UK</strong> companies, <strong>Cyprus</strong> can<br />
also offer easier access to<br />
regional markets <strong>in</strong> the East<br />
Mediterranean and the Middle<br />
East and of course to EU markets.<br />
educated labour force and of course the use of the English language. For <strong>UK</strong> companies,<br />
<strong>Cyprus</strong> can also offer easier access to regional markets <strong>in</strong> the East Mediterranean<br />
and the Middle East and of course to EU markets. <strong>Cyprus</strong>, like the <strong>UK</strong>, is a favourable<br />
tax jurisdiction. So, for <strong>UK</strong> firms a presence <strong>in</strong> <strong>Cyprus</strong> is of course beneficial and<br />
collaboration and jo<strong>in</strong>t ventures between companies <strong>in</strong> the two countries offer more<br />
benefits to both bus<strong>in</strong>ess communities.
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UNITED KINGDOM EDITION<br />
What k<strong>in</strong>d of new opportunities does <strong>Cyprus</strong> offer<br />
<strong>UK</strong> bus<strong>in</strong>ess or <strong>in</strong>vestment, and vice versa?<br />
<strong>UK</strong> companies and bus<strong>in</strong>ess organisations have traditionally been trad<strong>in</strong>g and<br />
<strong>in</strong>vest<strong>in</strong>g <strong>in</strong> <strong>Cyprus</strong> <strong>in</strong> all sectors of the economy. There is of course more activity<br />
<strong>in</strong> some sectors like f<strong>in</strong>ancial services, hospitality and tourism, real estate, shipp<strong>in</strong>g<br />
and education. Mov<strong>in</strong>g forward, and consider<strong>in</strong>g the chang<strong>in</strong>g bus<strong>in</strong>ess and political<br />
environment, more opportunities are develop<strong>in</strong>g <strong>in</strong> sectors like technology, AI and<br />
digital transformation, green energy and susta<strong>in</strong>able environment, smart cities,<br />
healthcare and education. These sectors may offer opportunities <strong>in</strong> both markets but<br />
perhaps at different stages of development, therefore, <strong>Cyprus</strong> and the <strong>UK</strong> may both<br />
benefit from the experiences and expertise of companies work<strong>in</strong>g <strong>in</strong> these sectors <strong>in</strong><br />
both countries. Collaboration is of the essence for progress and mutual ga<strong>in</strong>.<br />
What type of collaboration could be fostered <strong>in</strong> the future<br />
between the two countries to deepen economic relations?<br />
As mentioned, there are opportunities for further bus<strong>in</strong>ess and trade activities <strong>in</strong><br />
multiple sectors. More and new opportunities will come from sectors that are<br />
develop<strong>in</strong>g fast and are supported by political decisions and government policies<br />
such as environment policies, clean energy policies, susta<strong>in</strong>ability and smart cities to<br />
name a few. Also, the need to use new and<br />
advanced technologies and the progress<br />
of AI will offer significant opportunities<br />
for <strong>in</strong>vestment and trade collaboration<br />
between the two countries. Improv<strong>in</strong>g<br />
medical and social care services will<br />
enhance bus<strong>in</strong>ess collaboration, shar<strong>in</strong>g<br />
of expertise, as well as expand the<br />
tra<strong>in</strong><strong>in</strong>g and education offer which could<br />
be delivered <strong>in</strong> collaboration with the<br />
IThe need to use new and<br />
advanced technologies and<br />
the progress of AI will offer<br />
significant opportunities for<br />
<strong>in</strong>vestment and trade collaboration<br />
between the two countries.<br />
educational <strong>in</strong>stitutions <strong>in</strong> both countries. Overall, the bus<strong>in</strong>ess opportunities are<br />
available and <strong>in</strong>creas<strong>in</strong>g and the bus<strong>in</strong>ess communities <strong>in</strong> our two countries should<br />
move fast and effectively to take full advantage. We as HMG, will cont<strong>in</strong>ue to offer<br />
guidance and support to <strong>UK</strong> bus<strong>in</strong>esses where needed and of course I am sure that the<br />
<strong>Cyprus</strong> Government will aim to do the same.
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How do you see the relationship of the two<br />
countries develop<strong>in</strong>g <strong>in</strong> the future?<br />
It is clear that the overall relationship,<br />
<strong>in</strong>clud<strong>in</strong>g of course the bus<strong>in</strong>ess and<br />
trade l<strong>in</strong>ks, will cont<strong>in</strong>ue to flourish<br />
and benefit both countries. The strong<br />
and multifaceted l<strong>in</strong>ks will cont<strong>in</strong>ue to<br />
support and develop this relationship.<br />
Trade and commercial collaboration and<br />
partnership will offer tangible economic<br />
and f<strong>in</strong>ancial benefits to the people of<br />
both countries. n<br />
IOverall, the bus<strong>in</strong>ess opportunities<br />
are available and <strong>in</strong>creas<strong>in</strong>g<br />
and the bus<strong>in</strong>ess communities<br />
<strong>in</strong> our two countries should<br />
move fast and effectively<br />
to take full advantage.
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INTERVIEW<br />
High Commissioner of the Republic of <strong>Cyprus</strong> to the <strong>UK</strong><br />
Andreas S. Kakouris<br />
Inward <strong>in</strong>vestment can serve as the best proof for<br />
<strong>in</strong>vestors’ confidence <strong>in</strong> <strong>Cyprus</strong>, which is excell<strong>in</strong>g<br />
<strong>in</strong> traditional, but also new emerg<strong>in</strong>g sectors of<br />
the economy. The stability, access to other markets<br />
and the European base the island offers, makes<br />
<strong>Cyprus</strong> the perfect partner for <strong>UK</strong> economic<br />
and trade <strong>in</strong>terests, says Andreas S. Kakouris.
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How would you describe the current<br />
relationship between <strong>Cyprus</strong> and the <strong>UK</strong>?<br />
<strong>Cyprus</strong> and the <strong>UK</strong> ma<strong>in</strong>ta<strong>in</strong> very close relations spann<strong>in</strong>g decades, with an important<br />
historical dimension and particularities aris<strong>in</strong>g from the Treaty of Establishment<br />
and the Treaty of Guarantee. The importance of the dual-hatted position of <strong>Cyprus</strong> as<br />
an EU and Commonwealth Member State is put <strong>in</strong>to sharper focus today, and this can<br />
also be a catalyst for strengthen<strong>in</strong>g and expand<strong>in</strong>g our exist<strong>in</strong>g close cooperation. The<br />
two countries are also l<strong>in</strong>ked by significant human ties. The Cypriot diaspora <strong>in</strong> the <strong>UK</strong><br />
of over 300,000 consists of second, third and even fourth generation <strong>in</strong>dividuals who<br />
have fully <strong>in</strong>tegrated <strong>in</strong>to British society. At the same time, British nationals liv<strong>in</strong>g <strong>in</strong><br />
the Republic of <strong>Cyprus</strong> is estimated at 25,000-30,000.<br />
<strong>Cyprus</strong> is an established and stable <strong>in</strong>ternational<br />
bus<strong>in</strong>ess centre, what advantages and opportunities<br />
can the country offer specifically to <strong>UK</strong> bus<strong>in</strong>ess?<br />
F<br />
irstly, I would emphasise that <strong>Cyprus</strong> is a ‘home away from home’ for British citizens.<br />
A third of our visitors every year come from the <strong>UK</strong>. Additionally, a very vibrant<br />
British expat community resides on the island. English is widely spoken by Cypriots.<br />
Cypriot law is still heavily based on English Common Law, and we even share the same<br />
road system.<br />
<strong>Cyprus</strong> offers perfect climate conditions all year round to all of those who wish to<br />
enjoy a healthy lifestyle, with a wide range of <strong>in</strong>door and outdoor sites and activities.<br />
An excellent quality of life and a stable bus<strong>in</strong>ess environment are just a few of the many<br />
reasons why companies relocate their operations and other strategic functions to<br />
<strong>Cyprus</strong>.<br />
The island has become an <strong>in</strong>creas<strong>in</strong>gly popular choice as a location for <strong>in</strong>ternational<br />
and regional company headquarters and acts as a strategic spr<strong>in</strong>gboard <strong>in</strong>to<br />
neighbour<strong>in</strong>g markets. Some of the reasons are the island’s high rank<strong>in</strong>g <strong>in</strong> ease of<br />
do<strong>in</strong>g bus<strong>in</strong>ess, the strong and transparent regulatory framework, the abundant high<br />
skilled human talent, low cost of do<strong>in</strong>g bus<strong>in</strong>ess, and tax <strong>in</strong>centives, as well as fast track<br />
mechanisms for licens<strong>in</strong>g.<br />
<strong>Cyprus</strong> has already become an <strong>in</strong>creas<strong>in</strong>gly diverse <strong>in</strong>vestment dest<strong>in</strong>ation for largescale<br />
projects, such as luxury hotels, mar<strong>in</strong>as, state-of-the-art medical centres, and
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UNITED KINGDOM EDITION<br />
tertiary education <strong>in</strong>stitutions, funds and other private wealth management <strong>in</strong>itiatives,<br />
as well as start-up ventures.<br />
I am confident that post Brexit, the robust bilateral relationship between <strong>Cyprus</strong> and<br />
the <strong>UK</strong> will cont<strong>in</strong>ue to strengthen considerably over time, especially as <strong>Cyprus</strong> can<br />
serve as an ideal EU base for British companies and <strong>in</strong>dividual <strong>in</strong>vestors. The bus<strong>in</strong>ess<br />
cooperation between the two countries presents great potential <strong>in</strong> a plethora of sectors<br />
with high added value <strong>in</strong>clud<strong>in</strong>g tourism and hospitality, the energy sector, shipp<strong>in</strong>g,<br />
f<strong>in</strong>ancial services, healthcare, telecommunications, ICT, education and transport.<br />
<strong>Cyprus</strong> and the <strong>UK</strong> have a long-shared history and have been close partners <strong>in</strong><br />
various sectors, what would you say are the key projects between the two countries<br />
at the moment, and what k<strong>in</strong>d of cooperation would you like to see developed <strong>in</strong> the<br />
future?<br />
<strong>Cyprus</strong> and the <strong>UK</strong> have entered <strong>in</strong>to a number of bilateral agreements and<br />
memoranda which can solidify their cooperation even further. The Memorandum of<br />
Understand<strong>in</strong>g (MoU) on Establish<strong>in</strong>g a Strategic Cooperation, which was signed <strong>in</strong><br />
November 2022, seeks to put <strong>in</strong> place a more structured bilateral strategic cooperation<br />
<strong>in</strong> various fields, such as foreign and regional policy, security, trade, education,<br />
maritime, climate and crime.<br />
A new Double Taxation Agreement (DTA) was signed <strong>in</strong> 2018, to replace the previous<br />
one signed <strong>in</strong> 1974, for the elim<strong>in</strong>ation of double taxation with respect to taxes on<br />
<strong>in</strong>come and capital ga<strong>in</strong>s and the prevention of tax evasion and avoidance. Another<br />
significant MoU was signed at the beg<strong>in</strong>n<strong>in</strong>g of <strong>2023</strong> to lay a solid foundation for the<br />
further expansion of bilateral cooperation <strong>in</strong> all important aspects of shipp<strong>in</strong>g. It also<br />
promotes work<strong>in</strong>g together, with<strong>in</strong> the framework of participation <strong>in</strong> the International<br />
Maritime Organisation, to address the most important challenges fac<strong>in</strong>g the sector.<br />
The <strong>UK</strong> is a key trad<strong>in</strong>g partner for <strong>Cyprus</strong>. What<br />
k<strong>in</strong>d of British foreign direct <strong>in</strong>vestment has<br />
flowed <strong>in</strong>to <strong>Cyprus</strong> and <strong>in</strong>to what sectors?<br />
FDI plays an important role <strong>in</strong> the<br />
global economy. It is the key driver of<br />
<strong>in</strong>ternational economic <strong>in</strong>tegration, and<br />
with appropriate policy framework it<br />
can ma<strong>in</strong>ta<strong>in</strong> f<strong>in</strong>ancial stability, promote<br />
economic development, and enhance<br />
economic well-be<strong>in</strong>g.<br />
Likewise, the importance of FDI to the<br />
economy of <strong>Cyprus</strong> is significant, due to<br />
the size of the island’s economy. As such,<br />
IAn excellent quality of life and<br />
a stable bus<strong>in</strong>ess environment<br />
are just a few of the many<br />
reasons why companies relocate<br />
their operations and other<br />
strategic functions to <strong>Cyprus</strong>.<br />
<strong>in</strong>ward capital flows have <strong>in</strong>creased over the years. <strong>Cyprus</strong>’ <strong>in</strong>ward FDI stock has almost<br />
doubled <strong>in</strong> the last 10 years and most of it is channelled to the tertiary sector. More<br />
specifically, most of the <strong>in</strong>vestment was directed to f<strong>in</strong>ancial and <strong>in</strong>surance activities,<br />
real estate, tourism, transportation and various professional, scientific and technical<br />
activities.
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Recently, we have observed an <strong>in</strong>creas<strong>in</strong>g <strong>in</strong>terest of <strong>in</strong>vestment <strong>in</strong> fast-grow<strong>in</strong>g<br />
sectors, such as education, as well as software and IT, reflect<strong>in</strong>g <strong>Cyprus</strong>’ aspiration<br />
to become a regional hub for learn<strong>in</strong>g, science and <strong>in</strong>novation. Inward <strong>in</strong>vestment<br />
can serve as the best proof for <strong>in</strong>vestors’ confidence <strong>in</strong> <strong>Cyprus</strong>, which is excell<strong>in</strong>g <strong>in</strong><br />
traditional but also new emerg<strong>in</strong>g sectors of the economy.<br />
What areas or niche segments <strong>in</strong> <strong>Cyprus</strong> do you<br />
th<strong>in</strong>k have untapped potential <strong>in</strong> terms of attract<strong>in</strong>g<br />
more bus<strong>in</strong>ess and <strong>in</strong>vestment from the <strong>UK</strong>?<br />
C<br />
yprus is an EU state, geographically perfectly placed between three cont<strong>in</strong>ents,<br />
which offers regionally and <strong>in</strong>ternationally unique opportunities for <strong>in</strong>vestment<br />
across a wide range of sectors. Traditional sectors of strategic importance such as<br />
hospitality and tourism, shipp<strong>in</strong>g and f<strong>in</strong>ancial services have been the driv<strong>in</strong>g force<br />
beh<strong>in</strong>d <strong>Cyprus</strong>’ remarkable economic development <strong>in</strong> the last 30 years. In parallel,<br />
government, semi-government organisations, private sector and other stakeholders<br />
have worked closely together and set up a unique framework which offers an ideal<br />
bus<strong>in</strong>ess environment for new dynamic, fast emerg<strong>in</strong>g sectors.<br />
In the com<strong>in</strong>g years, <strong>Cyprus</strong> is expected, based on the liberalisation of the electricity<br />
market, to <strong>in</strong>crease enormously the use of renewable energy sources, as sun and w<strong>in</strong>d<br />
present untapped prospects. The market needs more green production but also higher<br />
capacity for storage and upgrad<strong>in</strong>g of the network to be able to accommodate the<br />
significant higher demand for consumption.
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The education sector consists of state-of-the art schools and higher education<br />
<strong>in</strong>stitutions which receive high rank<strong>in</strong>gs and attract a great number of local and<br />
<strong>in</strong>ternational students. The fact that the island is becom<strong>in</strong>g a regional educational<br />
centre has already resulted <strong>in</strong> a great deal of cooperation between <strong>in</strong>stitutions <strong>in</strong><br />
the <strong>UK</strong> and <strong>Cyprus</strong>. More specifically, the University of Central Lancashire (<strong>UK</strong>) has<br />
established a branch <strong>in</strong> <strong>Cyprus</strong>, which is one of the fully accredited <strong>Cyprus</strong> private<br />
universities. Furthermore, other universities <strong>in</strong> <strong>Cyprus</strong> have collaborated with <strong>UK</strong><br />
universities to develop and offer jo<strong>in</strong>t academic programmes and to share common<br />
research <strong>in</strong>itiatives.<br />
Likewise, the health sector <strong>in</strong> <strong>Cyprus</strong> has been through outstand<strong>in</strong>g developments,<br />
with the complete modernisation of the national health service and the significant<br />
expansion of the public and private sector. The health sector consists of hospitals and<br />
cl<strong>in</strong>ics that offer world-class treatments and services to patients from all over the world,<br />
and especially the <strong>UK</strong>, Europe and MENA countries, as well as the Far East. Synergies<br />
between the <strong>UK</strong> and <strong>Cyprus</strong> can deliver excellent results <strong>in</strong> all fields of healthcare, from<br />
<strong>in</strong>frastructure and mobility to tra<strong>in</strong><strong>in</strong>g and research.<br />
<strong>Cyprus</strong> is also creat<strong>in</strong>g an ideal ecosystem for <strong>in</strong>formation technology, research<br />
and development which currently attracts a great number of renowned companies<br />
and top talent from around the world. Some of the boom<strong>in</strong>g areas have been software<br />
development, data centres, customer service and back offices. For this reason, <strong>Cyprus</strong><br />
achieved an <strong>in</strong>crease of 35.6% <strong>in</strong> the <strong>in</strong>novation performance on the European<br />
Innovation Scoreboard, compared to the EU average of 8.5% between 2016 and 2022.<br />
What new prospects are on the horizon<br />
that could help strengthen the bilateral<br />
relations between the <strong>UK</strong> and <strong>Cyprus</strong>?<br />
am confident that the robust bilateral relationship between <strong>Cyprus</strong> and the <strong>UK</strong> will<br />
I cont<strong>in</strong>ue to strengthen considerably over time. <strong>Cyprus</strong> rema<strong>in</strong>s a tried and tested<br />
reliable bus<strong>in</strong>ess partner and will seek to further advance its position as a significant<br />
<strong>in</strong>ternational hub and <strong>in</strong>vestment dest<strong>in</strong>ation.<br />
Despite its small size and several shocks through time, the country has managed to<br />
stay on track, diversify and attract new <strong>in</strong>vestment, earn<strong>in</strong>g a reputation as one of the<br />
most resilient EU economies. Follow<strong>in</strong>g the global economic crisis of 2012, the island<br />
succeeded to emerge stronger from an<br />
unprecedented crisis and much faster<br />
IPost Brexit, the robust bilateral<br />
relationship between <strong>Cyprus</strong> and<br />
the <strong>UK</strong> will cont<strong>in</strong>ue to strengthen<br />
considerably over time, especially<br />
as <strong>Cyprus</strong> can serve as an ideal<br />
EU base for British companies<br />
and <strong>in</strong>dividual <strong>in</strong>vestors.<br />
than predicted. Indeed, <strong>in</strong> less than five<br />
years, the <strong>Cyprus</strong> economy achieved full<br />
recovery and a growth of almost 4%, one<br />
of the highest <strong>in</strong> the EU. Recently the<br />
credit rat<strong>in</strong>gs agencies have upgraded<br />
<strong>Cyprus</strong> <strong>in</strong>to <strong>in</strong>vestment-grade territory,<br />
and it is predicted that the economy will<br />
grow by 2.5% <strong>in</strong> <strong>2023</strong> and 2.9% <strong>in</strong> 2024.<br />
The <strong>Cyprus</strong> Government has set ‘Vision
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UNITED KINGDOM EDITION<br />
2035’, a long-term strategy, to build a resilient economy for <strong>Cyprus</strong> – a susta<strong>in</strong>able<br />
growth model focused on reform<strong>in</strong>g the economy through traditional, but also new<br />
high-growth sectors, transparent governance and upgraded regulatory framework,<br />
more available f<strong>in</strong>anc<strong>in</strong>g sources,<br />
I<strong>Cyprus</strong>’ and prom<strong>in</strong>ence on green and digital<br />
<strong>in</strong>ward FDI stock has<br />
transition.<br />
almost doubled <strong>in</strong> the last 10<br />
The <strong>UK</strong> has a long-stand<strong>in</strong>g worldwide<br />
reputation and expertise <strong>in</strong> fields such years and most of it is channelled<br />
as ICT, energy, healthcare, education and<br />
to the tertiary sector.<br />
f<strong>in</strong>ancial products, which <strong>Cyprus</strong> aspires<br />
to become a regional hub <strong>in</strong>. This, comb<strong>in</strong>ed with the stability, access to other markets<br />
and the European base the island offers, makes <strong>Cyprus</strong> the perfect partner for <strong>UK</strong><br />
economic and trade <strong>in</strong>terests. n
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SPOTLIGHT<br />
<strong>Cyprus</strong><br />
Real Estate<br />
The <strong>Cyprus</strong> real estate <strong>in</strong>dustry has cont<strong>in</strong>ued its strong<br />
growth <strong>in</strong> <strong>2023</strong>, underl<strong>in</strong><strong>in</strong>g robust confidence of both<br />
Cypriot and foreign property buyers. Sales reached<br />
€672 million <strong>in</strong> the first n<strong>in</strong>e months of the year, with<br />
coastal bus<strong>in</strong>ess hub Limassol, followed by Paphos on<br />
the west coast tak<strong>in</strong>g the lion’s share of contracts.
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<strong>Cyprus</strong> has long been a firm favourite for property buyers worldwide thanks to its<br />
high quality of life, safe environment and Mediterranean climate. In addition, the<br />
country’s EU membership, its thriv<strong>in</strong>g <strong>in</strong>ternational bus<strong>in</strong>ess centre and strategic<br />
position at the crossroads of three cont<strong>in</strong>ents rema<strong>in</strong> key pull-factors for residential<br />
buyers, relocat<strong>in</strong>g companies, and <strong>in</strong>vestors alike.<br />
Property sales have rema<strong>in</strong>ed strong <strong>in</strong> the last year despite ris<strong>in</strong>g <strong>in</strong>terest rates. In<br />
the first three quarters of <strong>2023</strong> real estate sales <strong>in</strong> <strong>Cyprus</strong> rose year on year by a robust<br />
19.9%. While Limassol had the largest absolute number of sales <strong>in</strong> January-September<br />
(3,842), the largest <strong>in</strong>crease was <strong>in</strong> the up-and-com<strong>in</strong>g coastal town of Larnaca, where<br />
sales saw a year-on-year <strong>in</strong>crease of 36.4%.<br />
Sales to Cypriots cont<strong>in</strong>ue to dom<strong>in</strong>ate, account<strong>in</strong>g for 54% of the total <strong>in</strong> the<br />
first three quarters of <strong>2023</strong>. Sales to Cypriots have been driven both by government<br />
subsidies, for example, for first-time buyers, but also by steady growth <strong>in</strong> the household<br />
population. However, <strong>in</strong> terms of growth, sales to non-EU citizens grew most quickly<br />
<strong>in</strong> <strong>2023</strong>, ris<strong>in</strong>g by 67.6% year on year <strong>in</strong> the first n<strong>in</strong>e months of <strong>2023</strong>, with reports of<br />
<strong>in</strong>creas<strong>in</strong>g demand from Lebanon and Israel.<br />
REAL ESTATE SALES BY REGION<br />
Contracts of sale unless otherwise <strong>in</strong>dicated<br />
Jan-Sep Jan-Sep % change<br />
2022 <strong>2023</strong> year on year<br />
Nicosia 2,043 2,159 5.7<br />
Limassol 3,315 3,842 15.9<br />
Larnaca 1,734 2,348 35.4<br />
Famagusta 490 567 15.7<br />
Paphos 2,028 2,603 28.4<br />
All <strong>Cyprus</strong> 9,610 11,519 19.9<br />
Source: Department of Lands and Surveys. © Sapienta Economics Ltd.<br />
CYPRIOT AND NON-CYPRIOT PROPERTY SALES<br />
Jan-Sep Jan-Sep % change % of total <strong>in</strong><br />
2022 <strong>2023</strong> year on year Jan-Sep <strong>2023</strong><br />
Cypriot contracts 5,476 6,230 13.8 54.1<br />
EU contracts 1,859 1,476 -20.6 12.8<br />
Non-EU contracts 2,275 3,813 67.6 33.1<br />
Total contracts 9,610 11,519 19.9 100.0<br />
Source: Department of Lands and Surveys. © Sapienta Economics Ltd.
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PROPERTY PRICE INDICATORS SHOW INCREASE IN PRICES<br />
Given the strength of sales and the ris<strong>in</strong>g construction prices, it is not surpris<strong>in</strong>g that<br />
the various residential property price <strong>in</strong>dices po<strong>in</strong>t to ris<strong>in</strong>g prices, even though<br />
the degree of <strong>in</strong>crease differs depend<strong>in</strong>g on the <strong>in</strong>dex. The <strong>in</strong>dex prepared by the<br />
Statistical Service, Cystat, which is based on actual sales, reports an <strong>in</strong>crease <strong>in</strong> prices<br />
of 5.9% <strong>in</strong> the first quarter of <strong>2023</strong> and 3.1% <strong>in</strong> the second. The Central Bank of <strong>Cyprus</strong><br />
<strong>in</strong>dex, which is based on a larger sample of valuations, reports a year-on-year <strong>in</strong>crease<br />
<strong>in</strong> prices of 7.7% <strong>in</strong> the first quarter of <strong>2023</strong> and 7.4% <strong>in</strong> the second. This is the fastest<br />
pace of growth s<strong>in</strong>ce 2008 accord<strong>in</strong>g to the Central Bank <strong>in</strong>dex.<br />
Apartment prices measured by the Central Bank <strong>in</strong>dex are clearly ris<strong>in</strong>g faster than<br />
those of houses. In the second quarter of <strong>2023</strong> they rose by 10.1% compared with an<br />
<strong>in</strong>crease of 5.6% for houses <strong>in</strong> the same quarter. This probably also underl<strong>in</strong>es the<br />
importance of the local residential market <strong>in</strong> property purchases, especially after the<br />
withdrawal of the <strong>Cyprus</strong> Investment Programme <strong>in</strong> 2020.<br />
The Central Bank <strong>in</strong>dex shows a fairly large discrepancy by district, however. While<br />
apartment prices <strong>in</strong> Paphos rose by 16.3% <strong>in</strong> the second quarter of <strong>2023</strong>, thanks to strong sales,<br />
apartment prices <strong>in</strong> Nicosia <strong>in</strong>creased by a more modest 4.2% and <strong>in</strong> Famagusta by 2.5%.<br />
All residential property<br />
PROPERTY PRICE INDICATORS<br />
% change over the same period of the previous year<br />
2022 Q2 2022 Q3 2022 Q4 <strong>2023</strong> Q1 <strong>2023</strong> Q2<br />
Cystat 2.1 5.3 4.4 5.9 3.1<br />
Central Bank of <strong>Cyprus</strong> 4.7 6.3 6.6 7.7 7.4<br />
Houses<br />
Central Bank of <strong>Cyprus</strong> 3.5 5.2 5.6 6.6 5.6<br />
Ask Wire -0.8 1.4 1.0 3.1 4.6<br />
Apartments<br />
Central Bank of <strong>Cyprus</strong> 7.0 8.0 7.7 8.4 10.1<br />
Ask Wire 6.3 9.4 9.9 12.3 12.2<br />
Other<br />
Ask Wire holiday houses -1.9 0.4 0.9 3.1 3.7<br />
Land Registry: average unit 8.4 32.2 3.9 3.8 16.8<br />
value of transfers (a)<br />
(a) Parcels may vary <strong>in</strong> size; Sapienta Economics calculations.<br />
Sources: Cystat; Central Bank of <strong>Cyprus</strong>; Ask Wire; Department of Lands and Surveys. © Sapienta Economics Ltd.
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PROPERTY-PRICE INDICES<br />
There are three regular property-price <strong>in</strong>dices<br />
produced <strong>in</strong> <strong>Cyprus</strong> and one which Sapienta<br />
Economics calculates from parcel transfers.<br />
u The Cystat <strong>in</strong>dex is hedonic (adjusted for changes <strong>in</strong><br />
quality) and is based on actual sales. The Cystat <strong>in</strong>dex does<br />
not give a breakdown by region or by property type.<br />
u The Central Bank of <strong>Cyprus</strong> <strong>in</strong>dex is also hedonic but is based on bank<br />
valuations, as opposed to current sales, although recent sales are also<br />
considered <strong>in</strong> valuations. The Central Bank of <strong>Cyprus</strong> <strong>in</strong>dex gives a<br />
breakdown by region and by property type (apartments and houses).<br />
u The Ask WiRE <strong>in</strong>dex, which is a fairly new <strong>in</strong>dex largely based<br />
on actual sales prices but also adjusted to consider ‘th<strong>in</strong> trad<strong>in</strong>g<br />
and an <strong>in</strong>herent lag <strong>in</strong> price record<strong>in</strong>g’ <strong>in</strong> <strong>Cyprus</strong>. It gives a<br />
breakdown by region and property type, <strong>in</strong>clud<strong>in</strong>g commercial<br />
property (retail, warehouses and offices). It also dist<strong>in</strong>guishes<br />
between residential and holiday houses/apartments.<br />
u Sapienta Economics also uses data from the Department of Lands<br />
and Surveys (Land Registry) to calculate the average price per unit<br />
of parcel transfers. This is not a market price, as it will <strong>in</strong>clude, for<br />
example, debt-for-property swaps by banks, and parcels may also<br />
vary <strong>in</strong> size. However, it can be an <strong>in</strong>dicator of forced acquisitions.<br />
The three public <strong>in</strong>dices give different results because of their different<br />
focus. Out of the three the Central Bank probably lags the most, as<br />
property valuations tend to be made on the basis of sales <strong>in</strong> the previous<br />
period. However, it has the advantage of be<strong>in</strong>g based on a larger data set<br />
than the Cystat <strong>in</strong>dex, especially <strong>in</strong> periods when sales are stagnant.
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UNITED KINGDOM EDITION<br />
PROPERTY<br />
SHOWCASE<br />
Lead<strong>in</strong>g<br />
Developments<br />
<strong>in</strong> <strong>Cyprus</strong>
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UNITED KINGDOM EDITION<br />
PROPERTY SHOWCASE: Lead<strong>in</strong>g Developments <strong>in</strong> <strong>Cyprus</strong><br />
LIMASSOL<br />
Limassol Greens<br />
Limassol<br />
Type: Villas 3-6 Bed, Townhouses<br />
3 Bed, Apartments 2-3 Bed<br />
Price: €550,000 - €5,500,000<br />
Developer: Lanitis Golf Public Co Ltd<br />
Contact: (+357) 25 888 700<br />
<strong>in</strong>fo@limassolgreens.com<br />
www.limassolgreens.com<br />
Watch: Property Video<br />
Download: Brochure<br />
LIMASSOL<br />
Limassol Mar<strong>in</strong>a<br />
Limassol<br />
Type: 3 and 4 bedroom apartments<br />
and villas with private berths<br />
or access to the beach<br />
Price: €3,900,000 – €9,600,000<br />
Developer: Limassol Mar<strong>in</strong>a Ltd.<br />
Shareholders: Avax S.A., Francoudi &<br />
Stephanou Ltd, Cybarco Ltd, LMDC Ltd,<br />
G Paraskevaides Ltd, and Stamoland Properties Ltd.<br />
Contact: (+357) 25 020 020<br />
<strong>in</strong>fo@limassolmar<strong>in</strong>a.com<br />
www.limassolmar<strong>in</strong>a.com<br />
Watch: Property Video<br />
LIMASSOL<br />
ONE by Pafilia Property Developers<br />
28th October Avenue,<br />
Limassol<br />
Type: 2-3 bedroom apartments,<br />
4 bedroom duplex,<br />
6 bedroom penthouse<br />
Price: From €1,950,000<br />
Developer: Pafilia Property Developers<br />
Contact: (+357) 26 848 800<br />
<strong>in</strong>fo@pafilia.com<br />
pafilia.com/one-limassol<br />
Watch: Property Video
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UNITED KINGDOM EDITION<br />
PROPERTY SHOWCASE: Lead<strong>in</strong>g Developments <strong>in</strong> <strong>Cyprus</strong><br />
LIMASSOL<br />
Trilogy Limassol Seafront<br />
Limassol<br />
Type: 1 to 5-bedroom apartments<br />
and penthouses<br />
Price: €680,000 - €10,500,000<br />
Developer: Cybarco Development Ltd<br />
Contact: (+357) 25 362 800<br />
<strong>in</strong>fo@trilogylimassol.com<br />
Trilogylimassol.com<br />
Watch: Property Video<br />
Download: Brochure<br />
PAPHOS<br />
Akamas Bay Villas<br />
Latchi,<br />
Paphos<br />
Type: 3 and 4-bedroom<br />
beachfront villas<br />
Price: €1,520,000 - €3,000,000<br />
Developer: Cybarco Development Ltd<br />
Contact: (+357) 25 820 511<br />
<strong>in</strong>fo@cybarco.com<br />
Akamasbay.com<br />
Watch: Property Video<br />
Download: Brochure<br />
PAPHOS<br />
Cap St Georges Hotel & Resort<br />
Akamas,<br />
Paphos<br />
Type: Villas, 3, 4, 5 and<br />
6-bedroom villas<br />
Price: From €1,800,000 +<br />
Developer: Korant<strong>in</strong>a Homes<br />
<strong>in</strong>fo@korant<strong>in</strong>ahomes.com<br />
www.korant<strong>in</strong>ahomes.com<br />
Watch: Property Video
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UNITED KINGDOM EDITION<br />
PROPERTY SHOWCASE: Lead<strong>in</strong>g Developments <strong>in</strong> <strong>Cyprus</strong><br />
PAPHOS<br />
M<strong>in</strong>this Topos Residence<br />
M<strong>in</strong>this,<br />
Paphos<br />
Type: 3, 4 and 5+ bedroom<br />
residences, 3-bedroom villa,<br />
2-bedroom suites and duplexes<br />
Price: From €845,000<br />
Developer: Pafilia Property Developers<br />
Contact: (+357) 26 848 800<br />
<strong>in</strong>fo@pafilia.com<br />
www.m<strong>in</strong>thisresort.com<br />
Watch: Property Video<br />
Watch: Resort Video<br />
PAPHOS<br />
Royal Bay<br />
Tourist Area,<br />
Paphos<br />
Type: Villas, 3,4,5 and 6-bedroom<br />
villas and 2-3 bedroom apartments<br />
Price: From €950.000 -5.000.000<br />
Developer: Korant<strong>in</strong>a Homes<br />
Contact: <strong>in</strong>fo@korant<strong>in</strong>ahomes.com<br />
www.korant<strong>in</strong>ahomes.com<br />
Watch: Property Video<br />
PAPHOS<br />
SOHO Resort<br />
Tourist Area,<br />
Paphos<br />
Type: Apartments on<br />
15-floor tower and Villas<br />
Price: €1,200,000 – 6,000,000<br />
Developer: Korant<strong>in</strong>a Homes<br />
<strong>in</strong>fo@korant<strong>in</strong>ahomes.com<br />
www.korant<strong>in</strong>ahomes.com<br />
Watch: Property Video
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UNITED KINGDOM EDITION<br />
INSIGHT<br />
CEO, Invest <strong>Cyprus</strong><br />
Marios Tannousis
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UNITED KINGDOM EDITION<br />
The <strong>UK</strong> and <strong>Cyprus</strong> have a longstand<strong>in</strong>g history of<br />
cooperation. The <strong>UK</strong> is also a key source market for<br />
<strong>Cyprus</strong> <strong>in</strong> terms of <strong>in</strong>vestment. What type of projects<br />
or sectors have seen significant British participation<br />
so far, and what type of foreign <strong>in</strong>vestment would<br />
you like to see from the <strong>UK</strong> <strong>in</strong> the future?<br />
I<br />
n the evolv<strong>in</strong>g landscape of global bus<strong>in</strong>ess, the relationship between <strong>Cyprus</strong> and<br />
the United K<strong>in</strong>gdom stands as a beacon of successful <strong>in</strong>ternational cooperation and<br />
mutual growth. We are thrilled to observe flourish<strong>in</strong>g <strong>in</strong>vestment ties between the two<br />
nations, a partnership that is both historic and forward-look<strong>in</strong>g.<br />
Our bond is underp<strong>in</strong>ned by an exceptional alignment <strong>in</strong> bus<strong>in</strong>ess and <strong>in</strong>vestment<br />
practices. <strong>Cyprus</strong>, a Common Law jurisdiction and member of the European Union, offers<br />
an unparalleled gateway for <strong>UK</strong> companies seek<strong>in</strong>g to penetrate the EU market. This<br />
strategic advantage is further enhanced by our role as a preferred location for the regional<br />
headquarter<strong>in</strong>g of <strong>UK</strong> companies look<strong>in</strong>g to expand <strong>in</strong>to the Middle East and North Africa<br />
(MENA) region. In a post-Brexit landscape, as Brita<strong>in</strong> looks to forge new markets beyond the<br />
EU, <strong>Cyprus</strong> emerges as a vital <strong>in</strong>terconnector. Situated at the crossroads of Europe, Asia,<br />
and Africa, <strong>Cyprus</strong> is uniquely positioned to serve as a hub for British companies aim<strong>in</strong>g to<br />
access markets <strong>in</strong> the Eastern Mediterranean region outside the EU.<br />
A qu<strong>in</strong>tessential symbol of our <strong>in</strong>tertw<strong>in</strong>ed economies is halloumi, a Cypriot cul<strong>in</strong>ary<br />
treasure that has found a second home <strong>in</strong> the <strong>UK</strong>. Approximately 40% of <strong>Cyprus</strong>’<br />
halloumi exports grace British tables, illustrat<strong>in</strong>g the depth of our trade relations.<br />
Beyond cheese, our trade encompasses diverse sectors, <strong>in</strong>clud<strong>in</strong>g automotive, shipp<strong>in</strong>g,<br />
and notably, legal and f<strong>in</strong>ancial services. Equally important is the fact that the <strong>UK</strong> is<br />
traditionally the biggest <strong>in</strong>bound tourism market for <strong>Cyprus</strong>.<br />
Our countries share more than just bus<strong>in</strong>ess <strong>in</strong>terests. We boast excellent<br />
professional talent pools and a common language, English, which is widely used<br />
<strong>in</strong> <strong>Cyprus</strong> and facilitates seamless communication and collaboration. This synergy<br />
provides a competitive edge for our partnerships, mak<strong>in</strong>g the whole greater than the<br />
sum of its parts. The <strong>UK</strong> cont<strong>in</strong>ues to be a global hub for <strong>in</strong>vestment decision mak<strong>in</strong>g,<br />
and it rema<strong>in</strong>s firmly <strong>in</strong> the spotlight of our efforts. This focus is <strong>in</strong>tegral to our 2024-<br />
2026 strategy, where the <strong>UK</strong> is identified as a priority region. Our goal is not just to<br />
ma<strong>in</strong>ta<strong>in</strong> our current levels of cooperation but to elevate them to new heights.<br />
Our collaboration could further extend <strong>in</strong>to crucial contemporary issues such<br />
as climate protection and the green economy. As both nations strive towards<br />
susta<strong>in</strong>ability, our jo<strong>in</strong>t <strong>in</strong>itiatives <strong>in</strong> these areas could represent not only a shared<br />
vision, but also a shared responsibility to the global community. The <strong>in</strong>vestment<br />
relationship between <strong>Cyprus</strong> and the <strong>UK</strong> is a testament to the power of endur<strong>in</strong>g<br />
partnerships and shared visions. We are committed to further strengthen<strong>in</strong>g this bond,<br />
creat<strong>in</strong>g new opportunities for bus<strong>in</strong>esses, and pav<strong>in</strong>g the way for future collaborations<br />
that benefit not only our nations but also the global economy. n
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INCENTIVES<br />
Attract<strong>in</strong>g<br />
Non-EU <strong>Bus<strong>in</strong>ess</strong><br />
<strong>Cyprus</strong> has launched a new action plan to attract foreign bus<strong>in</strong>esses<br />
to establish or expand their activities on the island. <strong>Cyprus</strong> already<br />
provides many competitive advantages, but this new set of <strong>in</strong>centives<br />
aims to ramp up the number of companies establish<strong>in</strong>g headquarters<br />
on the island. The plan has considered the best practices from other<br />
European countries, with emphasis on doma<strong>in</strong>s related to technology,<br />
shipp<strong>in</strong>g, <strong>in</strong>novation, research and development, pharmaceuticals,<br />
biogenetics and biotechnology and tertiary education without<br />
exclud<strong>in</strong>g any other companies that choose <strong>Cyprus</strong> as their place of<br />
bus<strong>in</strong>ess. The new strategy which aims to promote foreign <strong>in</strong>vestment<br />
and stimulate economic activity was implemented <strong>in</strong> January 2022.<br />
THE BUSINESS FACILITATION UNIT<br />
The previous Fast Track <strong>Bus<strong>in</strong>ess</strong> Activation mechanism for companies of foreign<br />
<strong>in</strong>terest has been transformed <strong>in</strong>to a <strong>Bus<strong>in</strong>ess</strong> Facilitation Unit for foreign<br />
companies operat<strong>in</strong>g <strong>in</strong> <strong>Cyprus</strong>, or for foreign companies that wish to expand their<br />
operations <strong>in</strong> the country. The Unit is responsible for the various services required for<br />
the establishment of corporate entities:<br />
• expedite new company name approval and registration<br />
• facilitate registration with Social Insurance Services, direct<br />
(<strong>in</strong>come) and <strong>in</strong>direct (VAT) tax authorities<br />
• guidance <strong>in</strong> relation to the establishment, licens<strong>in</strong>g and operations of companies
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RESIDENCE AND EMPLOYMENT PERMITS TO HIGHLY PAID THIRD-<br />
COUNTRY NATIONALS AND SUPPORTING STAFF<br />
The government has revised the policy for the employment of highly paid personnel<br />
from third countries employed by companies of foreign <strong>in</strong>terests, as well as for<br />
those employed by Cypriot companies which give added value to the economy and the<br />
local workforce.<br />
ELIGIBLE COMPANIES:<br />
• companies operat<strong>in</strong>g <strong>in</strong> <strong>Cyprus</strong> and are of foreign <strong>in</strong>terest/<br />
sharehold<strong>in</strong>g and ma<strong>in</strong>ta<strong>in</strong> fully-fledged offices<br />
• public companies registered on any recognised stock exchange<br />
• <strong>Cyprus</strong> shipp<strong>in</strong>g companies<br />
• <strong>Cyprus</strong> companies <strong>in</strong>volved <strong>in</strong> <strong>in</strong>novation and technology<br />
• <strong>Cyprus</strong> pharmaceutical companies or companies that<br />
operate <strong>in</strong> the fields of biogenetics or biotechnology<br />
• <strong>Cyprus</strong> Private Institutions of Tertiary (Higher) Education<br />
ELIGIBLE COMPANIES CAN EMPLOY HIGHLY PAID THIRD-COUNTRY<br />
NATIONALS IN KEY POSITIONS IF THE FOLLOWING CRITERIA IS MET:<br />
• a m<strong>in</strong>imum monthly gross salary of €2,500<br />
• candidate must hold a university degree or equivalent, or<br />
have a m<strong>in</strong>imum 2 years’ relevant experience<br />
• m<strong>in</strong>imum two-year contract<br />
All companies under the Strategy commit to <strong>in</strong>vest 30% of their total staff <strong>in</strong> Cypriots/<br />
EU citizens over a period of five years. In five years from the date of the enforcement of<br />
the Strategy, that is after 2.1.2027, the ratio for new hires will be checked. If a company<br />
does not adhere to the 70:30 ratio, cases will be evaluated on their own merits.<br />
Eligible companies will also be allowed to employ third-country nationals as<br />
support staff with a gross monthly salary of less than €2,500. The employment of<br />
third-country nationals as support staff<br />
is allowed, provided that it does not<br />
Wargam<strong>in</strong>g Headquarters, Nicosia<br />
exceed 30% of the total support staff and<br />
provided that the third country nationals<br />
and the employers have entered <strong>in</strong>to an<br />
employment contract approved by the<br />
relevant authority, the Department of<br />
Labour, <strong>in</strong> accordance with the applicable<br />
law. The amount of their salary is to be<br />
determ<strong>in</strong>ed by the current legislation.<br />
BENEFITS FOR THIRD<br />
COUNTRY NATIONALS:<br />
• work permits will be issued with<strong>in</strong><br />
a one-month period and will be<br />
valid for up to three years<br />
• a work permit can also be granted to<br />
the spouse of the eligible <strong>in</strong>dividual<br />
that obta<strong>in</strong>s a visa with this scheme
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CASE STUDY<br />
THREE-STEP PROCEDURE TO<br />
REGISTER AN ENTITY, ENTER THE<br />
BFU REGISTER AND EMPLOY THIRD-<br />
COUNTRY HIGH SKILLED PERSONNEL<br />
Company registration <strong>in</strong> <strong>Cyprus</strong> is simple and<br />
efficient. This is an example of the required<br />
steps for a simple and straightforward set up <strong>in</strong><br />
<strong>Cyprus</strong> for a small or medium sized company.<br />
THREE EASY STEPS:<br />
1<br />
REGISTRATION OF THE COMPANY<br />
Registration must be done at the Department of Registrar of Companies and<br />
Intellectual Property. It is advised to seek professional advice and once your<br />
lawyer has filed for registration, it can be expedited and completed <strong>in</strong> one (1)<br />
bus<strong>in</strong>ess day. The adm<strong>in</strong>istrative cost is €465, lawyer’s or adm<strong>in</strong>istrative service<br />
provider’s fees not <strong>in</strong>cluded. Breakdown of registration fees, typical example for<br />
a Private Limited Liability Company: €165 registration fee + €100 accelerated<br />
procedure + €200 company’s full set of certificates by accelerated procedure.<br />
2<br />
SUBMIT AN E-APPLICATION TO THE BFU<br />
An onl<strong>in</strong>e application form must be submitted supported by a ‘Letter<br />
of Intent’ and other relevant documents required to the <strong>Bus<strong>in</strong>ess</strong><br />
Facilitation Unit (BFU) to register the company as Company with Foreign<br />
Interests. This takes no more than seven (7) bus<strong>in</strong>ess days.<br />
3<br />
VISIT THE CIVIL REGISTRY & MIGRATION DEPARTMENT<br />
FOR OBTAINING PERMITS FOR THE EMPLOYEES<br />
F<strong>in</strong>ally, you must prepare the documentation and go through the<br />
application procedure to register the company’s employees with the Civil<br />
Registry & Migration Department (CRMD). For registration of the first employees<br />
of new companies registered as Companies with Foreign Interests by the <strong>Bus<strong>in</strong>ess</strong><br />
Facilitation Unit, service at the CRMD will be on a first come-first served basis,<br />
without an appo<strong>in</strong>tment. For the rest of the applications, predeterm<strong>in</strong>ed fixed<br />
weekly appo<strong>in</strong>tments for specific providers have been set, based on volume and<br />
frequency of applications submitted. In such appo<strong>in</strong>tments, it is expected that<br />
approximately 3-5 applications may be submitted. Smaller offices and <strong>in</strong>dividuals<br />
will be served daily on a first come-first served basis, without an appo<strong>in</strong>tment. In<br />
such cases, it is expected that no more than 3 applications are submitted. Applicable<br />
fees per case can be found on the website of the CRMD which do not exceed €330<br />
per employee, lawyer’s or adm<strong>in</strong>istrative service provider’s fees not <strong>in</strong>cluded. The<br />
residence permit of the employee for temporary residence and employment takes<br />
approximately 40 days to be issued, <strong>in</strong> the case of a positive review.
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FAMILY REUNIFICATION RIGHTS<br />
Family reunification rights are granted to third-country nationals employed by this<br />
revised policy and regulated by the <strong>Bus<strong>in</strong>ess</strong> Facilitation Unit. Direct and free access<br />
to paid employment (exclud<strong>in</strong>g self employment) is granted to spouses of the thirdcountry<br />
nationals who have obta<strong>in</strong>ed a residence and employment permit <strong>in</strong> <strong>Cyprus</strong>,<br />
through this revised policy and who receive a m<strong>in</strong>imum gross monthly salary of €2,500.<br />
This right does not extend to support<strong>in</strong>g staff who receive a monthly salary of less than<br />
€2,500.<br />
DIGITAL NOMAD VISA<br />
Significantly, the new Action Plan provides for the <strong>in</strong>troduction and the issu<strong>in</strong>g of<br />
Digital Nomad Visas with a maximum <strong>in</strong>itial limit of 500 beneficiaries.<br />
WHO IS ELIGIBLE:<br />
Third-country nationals who are either self-employed or employees who work<br />
remotely us<strong>in</strong>g <strong>in</strong>formation and communication technologies to communicate with<br />
their clients or employers who must be outside <strong>Cyprus</strong>.<br />
WHAT RIGHTS DO YOU GET:<br />
• right to stay <strong>in</strong> the country for up to one year, with the<br />
right to renew their visas for another two years<br />
• can be accompanied by family members, to whom a residence permit is granted<br />
upon request, which will expire at the same time as that of the ma<strong>in</strong> applicant<br />
• dur<strong>in</strong>g their stay <strong>in</strong> <strong>Cyprus</strong>, the spouse or partner and the m<strong>in</strong>or<br />
members of the ma<strong>in</strong> applicant’s family are not allowed to<br />
engage <strong>in</strong> any k<strong>in</strong>d of economic activity <strong>in</strong> the country<br />
WHAT ARE THE CONDITIONS:<br />
• must show evidence of sufficient resources at a fixed <strong>in</strong>come level of<br />
a m<strong>in</strong>imum €3,500/month to cover liv<strong>in</strong>g expenses dur<strong>in</strong>g their stay<br />
without burden<strong>in</strong>g the national welfare system (the amount is <strong>in</strong>creased<br />
by 20% <strong>in</strong> case they have a spouse/partner and another 15% per child)<br />
• must have a clean crim<strong>in</strong>al record and healthcare <strong>in</strong>surance coverage<br />
• the aforementioned prerequisites are <strong>in</strong>dicative and<br />
additional requirements are applicable<br />
In the event that the holders of Digital Nomad Visas reside <strong>in</strong> the Republic for one or<br />
more periods that cumulatively exceed 183 days, with<strong>in</strong> the same tax year, they are<br />
considered tax residents of <strong>Cyprus</strong> provided that they are not tax residents <strong>in</strong> any other<br />
state.
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TAX INCENTIVES<br />
The <strong>in</strong>centives also <strong>in</strong>clude the <strong>in</strong>troduction of new tax benefits and tax breaks.<br />
BROADENING TAX INCENTIVES:<br />
• a 50% tax exemption to be granted to new and exist<strong>in</strong>g employees relocat<strong>in</strong>g/<br />
relocated to <strong>Cyprus</strong> with employment remuneration of €55,000 and above (with<br />
the requirement that they were not <strong>Cyprus</strong> residents dur<strong>in</strong>g the previous 10 years)<br />
• beneficiaries of this tax benefit should be entitled to this benefit<br />
for a period of 17 years from the year of employment<br />
TAX EXEMPTION EXTENSION FOR INVESTMENTS IN INNOVATIVE COMPANIES:<br />
• extension of the 50% tax exemption for equity <strong>in</strong>vestment <strong>in</strong><br />
certified <strong>in</strong>novative companies to corporate <strong>in</strong>vestors<br />
INCREASED (COMPARED TO THE REAL) TAX DEDUCTION FOR<br />
RESEARCH AND DEVELOPMENT EXPENDITURE:<br />
• grant<strong>in</strong>g an <strong>in</strong>creased discount on research and development<br />
expenditure (e.g., by 20%). Eligible research and development expenses<br />
will be deducted from taxable <strong>in</strong>come at 120% of actual expenses<br />
NATURALISATION<br />
law proposal to change the naturalisation criteria is currently be<strong>in</strong>g discussed <strong>in</strong><br />
A Parliament.<br />
View from 360, Cyfield
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REDEFINING THE ART OF<br />
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foundation of our Group for over two<br />
decades. This diversity empowers<br />
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our equally diverse clientele.<br />
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Aspen Trust Group<br />
Elia House 77, Limassol Avenue 2121<br />
Nicosia - <strong>Cyprus</strong><br />
T: +357 2241 8888<br />
F: +357 2266 8111<br />
E: mar<strong>in</strong>a.zevedeou@aspentrust.com<br />
W: www.aspentrust.com
DOING BUSINESS C YPRUS<br />
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UNITED KINGDOM EDITION<br />
INTERVIEW<br />
President, <strong>Cyprus</strong>-<strong>UK</strong> <strong>Bus<strong>in</strong>ess</strong> Association<br />
Marios Andreou<br />
<strong>Cyprus</strong> has historically attracted significant<br />
<strong>in</strong>vestment and participation from the <strong>UK</strong> <strong>in</strong><br />
various economic sectors, but there is scope<br />
for more cooperation to further strengthen<br />
the bilateral relationship and strategic ties of<br />
the two countries, says Marios Andreou.
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UNITED KINGDOM EDITION<br />
How would you describe the current trade<br />
relations between <strong>Cyprus</strong> and the <strong>UK</strong>?<br />
The trade relations between the two countries are quite high, reflect<strong>in</strong>g the two<br />
countries’ long historical ties, which date back to the 19 th century. Accord<strong>in</strong>g to data,<br />
the total trade <strong>in</strong> goods and services, exports and imports, between the <strong>UK</strong> and <strong>Cyprus</strong><br />
was a bit over €4 billion <strong>in</strong> the four quarters to the end of Q2 <strong>2023</strong> – an <strong>in</strong>crease of 25.4%<br />
from the four quarters to the end of Q2 2022. In addition, the <strong>UK</strong> is <strong>Cyprus</strong>’ second most<br />
significant trad<strong>in</strong>g partner.<br />
It should be noted that the <strong>UK</strong> and the EU reached a Trade and Cooperation<br />
Agreement, that came <strong>in</strong>to effect on 1 January 2021, cover<strong>in</strong>g various aspects of their<br />
relationship, <strong>in</strong>clud<strong>in</strong>g trade. While the <strong>UK</strong> is no longer part of the EU’s S<strong>in</strong>gle Market<br />
and Customs Union, the agreement aims to ma<strong>in</strong>ta<strong>in</strong> trade between the <strong>UK</strong> and the EU<br />
member states, <strong>in</strong>clud<strong>in</strong>g <strong>Cyprus</strong>, with reduced trade barriers.<br />
What economic sectors <strong>in</strong> <strong>Cyprus</strong> have seen<br />
significant <strong>in</strong>vestment and participation from the<br />
<strong>UK</strong>, and <strong>in</strong> what type of projects and activity?<br />
<strong>Cyprus</strong> has historically attracted significant <strong>in</strong>vestment and participation from the<br />
<strong>UK</strong> <strong>in</strong> various economic sectors. Some of the sectors that have seen notable <strong>UK</strong><br />
<strong>in</strong>volvement <strong>in</strong>clude tourism and hospitality, real estate, f<strong>in</strong>ancial services, shipp<strong>in</strong>g,<br />
education, and technology and <strong>in</strong>novation.<br />
The tourism <strong>in</strong>dustry <strong>in</strong> <strong>Cyprus</strong> has been a major focus for British <strong>in</strong>vestors. Many<br />
<strong>UK</strong> tourists visit <strong>Cyprus</strong> each year, and British companies have <strong>in</strong>vested <strong>in</strong> hotels,<br />
resorts, and other tourism-related ventures on the island. British citizens have been<br />
active buyers of real estate <strong>in</strong> <strong>Cyprus</strong>, particularly <strong>in</strong> the coastal areas. The appeal of a<br />
Mediterranean climate, beautiful landscapes, and a relatively low cost of liv<strong>in</strong>g has led<br />
to substantial <strong>in</strong>vestment <strong>in</strong> residential and commercial properties.<br />
In terms of f<strong>in</strong>ancial services, <strong>Cyprus</strong><br />
has been a popular dest<strong>in</strong>ation for <strong>UK</strong><br />
companies seek<strong>in</strong>g to establish a presence<br />
with<strong>in</strong> the European Union. The f<strong>in</strong>ancial<br />
services sector, <strong>in</strong>clud<strong>in</strong>g bank<strong>in</strong>g and<br />
<strong>in</strong>surance, has attracted British firms<br />
<strong>in</strong>terested <strong>in</strong> serv<strong>in</strong>g both Cypriot and EU<br />
markets. In addition, <strong>Cyprus</strong> has a wellestablished<br />
shipp<strong>in</strong>g <strong>in</strong>dustry, and the <strong>UK</strong><br />
has been <strong>in</strong>volved <strong>in</strong> this sector, <strong>in</strong>clud<strong>in</strong>g<br />
<strong>in</strong> ship management, maritime services,<br />
and ship registration.<br />
IPerhaps the biggest advantage<br />
that <strong>Cyprus</strong> can offer to <strong>UK</strong><br />
companies and <strong>in</strong>vestors is the<br />
comb<strong>in</strong>ation of a familiar legal<br />
system and an abundance of <strong>UK</strong><br />
graduates and English-speak<strong>in</strong>g<br />
people <strong>in</strong> the talent pool.
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The education sector has seen British <strong>in</strong>vestment with several private schools and<br />
universities <strong>in</strong> <strong>Cyprus</strong> offer<strong>in</strong>g British-style education programmes. These <strong>in</strong>stitutions<br />
cater to both local and <strong>in</strong>ternational students. While the technology sector, particularly<br />
<strong>in</strong> areas like <strong>in</strong>formation technology and telecommunications, has witnessed <strong>in</strong>terest<br />
from <strong>UK</strong> companies look<strong>in</strong>g to expand their operations or collaborate with local tech<br />
firms. It’s important to note that the nature and extent of <strong>UK</strong> <strong>in</strong>volvement <strong>in</strong> these<br />
sectors may vary over time, <strong>in</strong>fluenced by economic conditions, government policies,<br />
and market dynamics.<br />
What advantages does <strong>Cyprus</strong> offer specifically<br />
to <strong>UK</strong> companies and <strong>in</strong>vestors?<br />
Perhaps the biggest advantage that <strong>Cyprus</strong> can offer to <strong>UK</strong> companies and <strong>in</strong>vestors<br />
is the comb<strong>in</strong>ation of a familiar legal system and an abundance of <strong>UK</strong> graduates<br />
and English-speak<strong>in</strong>g people <strong>in</strong> the talent pool. As the <strong>Cyprus</strong> legal system is based<br />
on English Common Law pr<strong>in</strong>ciples, <strong>UK</strong> companies and <strong>in</strong>vestors will be carry<strong>in</strong>g<br />
out bus<strong>in</strong>ess <strong>in</strong> <strong>Cyprus</strong> under a familiar legal framework which is very important to<br />
create trust when carry<strong>in</strong>g out bus<strong>in</strong>ess. The abundance of English speak<strong>in</strong>g and <strong>UK</strong><br />
university graduates <strong>in</strong> the talent pool,<br />
who understand British culture and the<br />
way of do<strong>in</strong>g bus<strong>in</strong>ess is also reassur<strong>in</strong>g,<br />
whether these are bus<strong>in</strong>ess partners,<br />
counterparts, or colleagues.<br />
Another very important advantage<br />
I<strong>Cyprus</strong>, as a full member of the EU,<br />
can provide <strong>UK</strong> companies with a<br />
gateway to the EU s<strong>in</strong>gle market.<br />
is the fact that <strong>Cyprus</strong>, as a full member of the EU, can provide <strong>UK</strong> companies with a<br />
gateway to the EU s<strong>in</strong>gle market. This can be especially valuable for bus<strong>in</strong>esses that<br />
want to ma<strong>in</strong>ta<strong>in</strong> a presence with<strong>in</strong> the EU follow<strong>in</strong>g the <strong>UK</strong>’s departure from the<br />
Union. Moreover, <strong>Cyprus</strong> is strategically located at the crossroads of Europe, Asia, and<br />
Africa and serves as a bridge between these regions, <strong>in</strong>clud<strong>in</strong>g as a place for regional<br />
headquarters. Its tax system is modern and <strong>in</strong> l<strong>in</strong>e with EU and OECD requirements<br />
and has been <strong>in</strong> place s<strong>in</strong>ce 2003.<br />
What new prospects and opportunities could be cultivated<br />
to facilitate more bus<strong>in</strong>ess between <strong>Cyprus</strong> and the <strong>UK</strong>?<br />
<strong>Cyprus</strong> has been develop<strong>in</strong>g its energy resources, <strong>in</strong>clud<strong>in</strong>g offshore natural gas<br />
reserves. The <strong>UK</strong>, with its expertise <strong>in</strong> the energy sector, can explore cooperation <strong>in</strong><br />
energy exploration, production, and distribution, potentially lead<strong>in</strong>g to energy security<br />
and mutual economic benefits. Collaboration on environmental issues, susta<strong>in</strong>ability,<br />
and climate change can also be explored, with both countries work<strong>in</strong>g together to<br />
address global challenges.<br />
The healthcare sector <strong>in</strong> <strong>Cyprus</strong> can attract <strong>UK</strong> patients seek<strong>in</strong>g high-quality<br />
medical services and treatments. Build<strong>in</strong>g medical tourism <strong>in</strong>frastructure and
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promot<strong>in</strong>g healthcare services can be a mutually beneficial endeavour. The construction<br />
sector offers many opportunities for cooperation, with <strong>UK</strong> companies contribut<strong>in</strong>g to<br />
<strong>in</strong>frastructure development <strong>in</strong> <strong>Cyprus</strong>, <strong>in</strong>clud<strong>in</strong>g transportation, hous<strong>in</strong>g, and urban<br />
plann<strong>in</strong>g projects.<br />
Post Covid, <strong>Cyprus</strong> is <strong>in</strong>creas<strong>in</strong>gly becom<strong>in</strong>g a choice for a number of companies to<br />
set up their bus<strong>in</strong>ess and <strong>in</strong>dividuals as a place to live and work <strong>in</strong>. This is <strong>in</strong>creas<strong>in</strong>g<br />
the demand for quality education at all levels, especially English-speak<strong>in</strong>g education,<br />
as families move to <strong>Cyprus</strong>. There is a great opportunity for <strong>UK</strong> education <strong>in</strong>stitutions<br />
to collaborate with Cypriot ones <strong>in</strong> this space.<br />
By actively pursu<strong>in</strong>g the many opportunities, <strong>Cyprus</strong> and the <strong>UK</strong> can strengthen<br />
their bilateral relationship, diversify their economic and strategic ties, and adapt to the<br />
evolv<strong>in</strong>g global landscape while ma<strong>in</strong>ta<strong>in</strong><strong>in</strong>g their historical connections.
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How does the <strong>Cyprus</strong>-<strong>UK</strong> <strong>Bus<strong>in</strong>ess</strong> Association support<br />
and foster bus<strong>in</strong>ess l<strong>in</strong>ks between the two countries?<br />
Our Association operates under the<br />
auspices of the <strong>Cyprus</strong> Chamber<br />
of Commerce and Industry. The ma<strong>in</strong><br />
purpose of our Association is to keep<br />
improv<strong>in</strong>g the economic and bus<strong>in</strong>ess ties<br />
between the two countries. Through its<br />
dist<strong>in</strong>guished professional members, it<br />
encourages network<strong>in</strong>g for the promotion<br />
and stimulation of bus<strong>in</strong>ess relations<br />
and <strong>in</strong>vestments <strong>in</strong> the two countries.<br />
Moreover, exchange of <strong>in</strong>formation,<br />
delegations, sem<strong>in</strong>ars and bus<strong>in</strong>ess<br />
IBy actively pursu<strong>in</strong>g the many<br />
opportunities, <strong>Cyprus</strong> and the<br />
<strong>UK</strong> can strengthen their bilateral<br />
relationship, diversify their<br />
economic and strategic ties,<br />
and adapt to the evolv<strong>in</strong>g global<br />
landscape while ma<strong>in</strong>ta<strong>in</strong><strong>in</strong>g<br />
their historical connections.<br />
forums organised by the Association, aim<br />
at foster<strong>in</strong>g and promot<strong>in</strong>g the bilateral relations of the two countries. n
Flavours<br />
oF<br />
<strong>Cyprus</strong><br />
ts@meci.gov.cy<br />
www.meci.gov.cy
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WHO’S<br />
WHO<br />
CYPRUS BUSINESS DIRECTORY<br />
-<br />
-<br />
-<br />
-<br />
-<br />
-<br />
Account<strong>in</strong>g<br />
Agriculture, Forestry & Fish<strong>in</strong>g<br />
Associations & Organisations<br />
Audit<strong>in</strong>g & Assurance<br />
Bank<strong>in</strong>g<br />
<strong>Bus<strong>in</strong>ess</strong> Research<br />
-<br />
Capital Markets<br />
The def<strong>in</strong>itive<br />
guide to <strong>Cyprus</strong>’<br />
lead<strong>in</strong>g companies,<br />
professional advisors,<br />
government bodies<br />
and <strong>in</strong>dustry<br />
organisations.<br />
-<br />
-<br />
-<br />
-<br />
-<br />
Communications<br />
Construction<br />
Consult<strong>in</strong>g<br />
Corporate Services<br />
Education & Research
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-<br />
Energy & Environment<br />
-<br />
Media & Market<strong>in</strong>g<br />
-<br />
F<strong>in</strong>ancial Services<br />
-<br />
Metals & M<strong>in</strong><strong>in</strong>g<br />
-<br />
Food & Beverage<br />
-<br />
Property & Real Estate<br />
-<br />
Government<br />
-<br />
Regulation & Supervision<br />
-<br />
Healthcare<br />
-<br />
Retail & Consumer Goods<br />
-<br />
Hospitality<br />
-<br />
Ship & Yacht Registration<br />
-<br />
HR & Recruitment<br />
-<br />
Tax Plann<strong>in</strong>g<br />
-<br />
Insurance<br />
-<br />
Technology<br />
-<br />
Investment Services<br />
-<br />
Telecommunications<br />
-<br />
Law Firms<br />
-<br />
Transportation & Logistics<br />
-<br />
Management Consult<strong>in</strong>g<br />
-<br />
Trust & Fiduciary Services<br />
-<br />
Manufactur<strong>in</strong>g & Industry<br />
-<br />
Utilities
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BUSINESS OPERATING ENVIRONMENT<br />
DOING<br />
BUSINESS<br />
INCYPRUS<br />
€<br />
<strong>Cyprus</strong>’ bus<strong>in</strong>ess-friendly <strong>in</strong>frastructure and cando<br />
attitude has brought it worldwide recognition<br />
as an <strong>in</strong>ternational bus<strong>in</strong>ess centre. The country<br />
offers a w<strong>in</strong>n<strong>in</strong>g package for both <strong>in</strong>ternational<br />
entrepreneurs and <strong>in</strong>vestors with its sophisticated<br />
bus<strong>in</strong>ess environment, highly skilled workforce<br />
and cost-effective, yet high quality of life.
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BUSINESS CULTURE<br />
Respect, hospitality and personal trust are the cornerstones of the Cypriot bus<strong>in</strong>ess<br />
environment. An island nation with a long history of deal<strong>in</strong>g with foreign traders<br />
and bus<strong>in</strong>esses, Cypriot bus<strong>in</strong>esspeople are <strong>in</strong>ternational <strong>in</strong> their outlook and astute<br />
and knowledgeable <strong>in</strong> their negotiations. Punctuality is expected, bus<strong>in</strong>ess dress is<br />
formal for both men and women, especially at the beg<strong>in</strong>n<strong>in</strong>g of a bus<strong>in</strong>ess relationship,<br />
and even <strong>in</strong> warm weather. Most Cypriots prefer face-to-face meet<strong>in</strong>gs to telephone<br />
conferences or written communications, which are regarded as too impersonal, and<br />
place great importance on build<strong>in</strong>g personal relationships with bus<strong>in</strong>ess partners or<br />
connections. Trust is the key to successful bus<strong>in</strong>ess deal<strong>in</strong>gs <strong>in</strong> <strong>Cyprus</strong>.<br />
LANGUAGE<br />
Greek and Turkish are the official languages of <strong>Cyprus</strong>. However, English, the<br />
legacy of the British who ruled <strong>Cyprus</strong> from 1878 to 1960, is widely spoken and is<br />
the language of bus<strong>in</strong>ess. Many Cypriots also speak French, German or Russian.<br />
BUSINESS HOURS<br />
Office hours are generally 8.30am to 1.00pm and 2.00pm to 5.30pm, Monday to<br />
Friday. Although <strong>in</strong> summer some offices take a longer lunch break or f<strong>in</strong>ish early.<br />
Nicosia
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BUSINESS COSTS<br />
An EU base with<strong>in</strong> the eurozone, <strong>Cyprus</strong> rema<strong>in</strong>s one of the few <strong>in</strong>ternational<br />
bus<strong>in</strong>ess centres offer<strong>in</strong>g low operational costs and a high standard of liv<strong>in</strong>g.<br />
Office space and residential property <strong>in</strong> Nicosia, the capital and major bus<strong>in</strong>ess<br />
centre, is relatively <strong>in</strong>expensive when compared to other European capitals.<br />
In terms of cost of liv<strong>in</strong>g, <strong>Cyprus</strong> rema<strong>in</strong>s one of the most advantageous places to<br />
live, with cost of liv<strong>in</strong>g lower than <strong>in</strong> most Western European countries. At the same<br />
time, residents of <strong>Cyprus</strong> enjoy a high standard of liv<strong>in</strong>g and exceptional quality of<br />
life, as the balmy climate and low crime rate offer both comfort and peace of m<strong>in</strong>d.<br />
<strong>Bus<strong>in</strong>ess</strong> Costs <strong>Cyprus</strong> EU27 Average<br />
Labour (bus<strong>in</strong>ess sector) €19.40 €30.05<br />
Communications (services & equipment)* 77.20 94.70<br />
Electricity (households) €0.3739/kWh €0.289/kWh<br />
Electricity (non-households) €0.1921/kWh €0.1885/kWh<br />
* EU average was set to equal 100 po<strong>in</strong>ts for benchmark year 2015.<br />
Source: Eurostat (<strong>2023</strong>)<br />
Limassol Mar<strong>in</strong>a<br />
COMMERCIAL AND RESIDENTIAL PROPERTY<br />
<strong>Cyprus</strong> offers a full range of properties for both commercial and residential use<br />
situated <strong>in</strong> key locations across the island. While the exclusive, top-level market<br />
is currently the most sought after, the island has a good stock of properties available,<br />
from townhouses and apartments, to villas and seaside bungalows <strong>in</strong> five-star gated<br />
developments. Nicosia and Limassol are the ma<strong>in</strong> bus<strong>in</strong>ess centres. Office space<br />
is available <strong>in</strong> purpose-built office blocks, <strong>in</strong> converted houses or flats. A number of<br />
bus<strong>in</strong>ess centres also offer ready-to-move-<strong>in</strong>to offices. They usually <strong>in</strong>clude fully<br />
equipped offices that are available on demand with flexible terms, meet<strong>in</strong>g rooms<br />
and a receptionist service. Overall, rentals are around two-thirds of those charged<br />
for comparable commercial spaces <strong>in</strong> cont<strong>in</strong>ental Europe, and offices, retail or other<br />
commercial space is widely available for purchase or for rent.
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300<br />
200<br />
COMPARISON OF ESTIMATED AVERAGE RENT LEVELS<br />
FOR FLATS, 2021 (BRUSSELS = 100)<br />
European<br />
Union<br />
Europe<br />
(others)<br />
100<br />
0<br />
225<br />
216<br />
199<br />
199<br />
197<br />
171<br />
134<br />
128<br />
122<br />
122<br />
119<br />
109<br />
104<br />
100<br />
99<br />
99<br />
Dubl<strong>in</strong><br />
Copenhagen<br />
Paris<br />
Luxembourg<br />
Stockholm<br />
Hels<strong>in</strong>ki<br />
Berl<strong>in</strong><br />
The Hague<br />
Madrid<br />
Vienna<br />
Lisbon<br />
Rome<br />
Vilnius<br />
Brussels<br />
Valletta<br />
Ljubljana<br />
Budapest<br />
Tall<strong>in</strong>n<br />
Athens<br />
Prague<br />
Zagreb<br />
Riga<br />
Bratislava<br />
Warsaw<br />
Bucharest<br />
Nicosia<br />
Sofia<br />
London<br />
Geneva<br />
Rejkjavik<br />
Oslo<br />
Podgorica<br />
98<br />
98<br />
98<br />
96<br />
94<br />
84<br />
81<br />
74<br />
71<br />
64<br />
46<br />
278<br />
227<br />
188<br />
178<br />
54<br />
Note: Rents <strong>in</strong> currencies other than the Euro were converted accord<strong>in</strong>g to the exchange rate as of 1 July 2021.<br />
Source: Eurostat<br />
OFFICE SPACE<br />
In terms of office rental and sales prices, Limassol cont<strong>in</strong>ues to be the most expensive<br />
region followed by Nicosia, Larnaca, Paphos and Famagusta respectively.<br />
OFFICE SALE AND RENTAL PRICES PER CITY (2022)<br />
Sale Prices (per m 2 ) Rental Prices (per m 2 )<br />
Famagusta €1,300-€1,500 €6-€10<br />
Larnaca €1,800-€2,500 €8-€10<br />
LImassol €4,500-€6,500 €20-€40<br />
Nicosia €3,500-€4,500 €12-€22<br />
Paphos €1,400-€2,000 €7-€10<br />
Source: Danos International Property Consultants<br />
HUMAN RESOURCES<br />
Well-tra<strong>in</strong>ed and versatile, the Cypriot workforce is one of the island’s most<br />
valuable resources, offer<strong>in</strong>g high standards of productivity, technical expertise<br />
and professional excellence at reasonable costs to bus<strong>in</strong>esses.<br />
Accord<strong>in</strong>g to the Statistical Service <strong>in</strong> <strong>Cyprus</strong>, the country records the most higher<br />
education graduates per capita (age 30-34) <strong>in</strong> the European Union.<br />
The Cypriot labour force amounted to 482,385 persons or 65.1% of the population<br />
(males 71.2%, females 59.5%) <strong>in</strong> the Q2 of 2022. The biggest percentage of employed<br />
persons was <strong>in</strong> services (80.7%), followed by manufactur<strong>in</strong>g (16.8%) and agriculture<br />
(2.5%).
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SALARY SURVEY <strong>2023</strong> Source: GRS Recruitment<br />
JOB TITLE LOW (€) MID (€) HIGH (€)<br />
Management CEO 90,000 110,000 130,000<br />
Executive Director 60,000 100,000 140,000<br />
CFO 65,000 85,000 120,000<br />
Account<strong>in</strong>g & F<strong>in</strong>ance F<strong>in</strong>ancial Controller 55,000 65,000 80,000<br />
F<strong>in</strong>ance Manager / Senior Accountant 40,000 55,000 65,000<br />
Accountant / Auditor (Qualified) 35,000 40,000 45,000<br />
Accountant / Auditor (Part Qualified or QBE) 24,000 30,000 36,000<br />
Account Assistant 18,000 22,000 25,000<br />
HR Department Head of HR / Group HRM 50,000 80,000 100,000<br />
HR Manager 40,000 50,000 60,000<br />
HR Executive 21,000 24,000 28,000<br />
Legal Deparment Head of Legal / Group Legal Head 65,000 90,000 130,000<br />
Legal Advisor (Qualified Lawyer) 28,000 39,000 55,000<br />
Legal Assistant / Paralegal / None Qualified Lawyer 18,000 22,000 26,000<br />
Compliance, Anti-Money Head of Compliance 57,000 72,000 90,000<br />
Lauder<strong>in</strong>g (AML), Counter - Compliance / AML / CTF Manager 42,000 46,000 52,000<br />
Terrorist F<strong>in</strong>anc<strong>in</strong>g (CTF) Compliance / AML / CTF Officer 2 8,000 36,000 42,000<br />
Deal<strong>in</strong>g Room Chief Dealer 50,000 55,000 65,000<br />
Dealer 24,000 36,000 42,000<br />
Junior Dealer 18,000 20,000 24,000<br />
IT Department Head of IT / CTO 65,000 80,000 140,000<br />
IT Manager / Development Manager 50,000 65,000 80,000<br />
Quality Assurance(QA) / Tester 26,000 36,000 45,000<br />
IT Technician 20,000 28,000 36,000<br />
Developer 30,000 42,000 60,000<br />
Market<strong>in</strong>g Department Head of Market<strong>in</strong>g 50,000 72,000 90,000<br />
Market<strong>in</strong>g Officer 24,000 30,000 39,000<br />
Digital Market<strong>in</strong>g Specialist (Social, PPC / SEO) 30,000 36,000 42,000<br />
Market<strong>in</strong>g Executive 18,000 24,000 28,000<br />
Sales Departmen Head of Sales 42,000 50,000 60,000<br />
FX Sales 24,000 28,000 30,000<br />
Sales Executive (Industries other than FX / F<strong>in</strong>tech) 18,000 24,000 26,000<br />
Adm<strong>in</strong>istration Office Manager / Personal Assistant 24,000 36,000 40,000<br />
Adm<strong>in</strong>istrator / Receptionist 18,000 20,000 24,000<br />
Corporate Adm<strong>in</strong>istrator 22,000 30,000 36,000
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TAXATION<br />
Tax and Regulatory<br />
Regime of <strong>Cyprus</strong><br />
<strong>Cyprus</strong> offers one of the most attractive tax regimes<br />
<strong>in</strong> Europe. A member of the European Union s<strong>in</strong>ce<br />
2004, <strong>Cyprus</strong>’ regulatory regime is <strong>in</strong> full compliance<br />
with the requirements of the EU and OECD. <strong>Cyprus</strong> has<br />
one of the lowest EU corporate tax rates at 12.5%. The<br />
island’s advantageous tax rate coupled with an extensive<br />
list of double tax treaties places it high on the list of<br />
preferred jurisdictions for <strong>in</strong>ternational tax planners.<br />
CORPORATION TAX<br />
The Corporation Tax Rate <strong>in</strong> <strong>Cyprus</strong> is 12.5%.<br />
BASIS OF TAXATION<br />
All companies that are tax residents of <strong>Cyprus</strong> are taxed on their <strong>in</strong>come accrued or<br />
derived from all sources <strong>in</strong> <strong>Cyprus</strong> and abroad. A non-<strong>Cyprus</strong> tax resident company is<br />
taxed on <strong>in</strong>come accrued or derived from a bus<strong>in</strong>ess activity which is carried out through<br />
a permanent establishment <strong>in</strong> <strong>Cyprus</strong> and on certa<strong>in</strong> <strong>in</strong>come aris<strong>in</strong>g from sources <strong>in</strong><br />
<strong>Cyprus</strong>. A company is considered tax resident of <strong>Cyprus</strong> if it is managed and controlled<br />
from <strong>Cyprus</strong>. As of <strong>2023</strong>, a <strong>Cyprus</strong> <strong>in</strong>corporated company is by default considered a tax<br />
resident of <strong>Cyprus</strong> provided it is not tax resident <strong>in</strong> any other jurisdiction.<br />
Trilogy, Limassol
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UNITED KINGDOM EDITION<br />
SPECIAL TYPES OF COMPANIES<br />
SHIPPING COMPANIES<br />
The Merchant Shipp<strong>in</strong>g Legislation, fully approved by the EU, provides for an exemption<br />
from all direct taxes and taxation under the tonnage tax regime. The merchant<br />
shipp<strong>in</strong>g legislation applies to qualify<strong>in</strong>g shipowners, charterers and ship managers,<br />
which are <strong>in</strong>volved with the operation of qualify<strong>in</strong>g community ships (ships under a CY<br />
flag or a flag of an EU member state or of a country <strong>in</strong> the European Economic Area)<br />
and foreign (non-community) ships (under conditions) and provided that they engage<br />
<strong>in</strong> qualify<strong>in</strong>g activities. The legislation allows non-community vessels to enter the<br />
tonnage tax regime provided the fleet is composed by at least 60% community vessels.<br />
If this requirement is not met, then non-community vessels can still qualify if certa<strong>in</strong><br />
criteria are met. Exemption is also given <strong>in</strong> relation to the salaries of officers and crew<br />
aboard a <strong>Cyprus</strong> ship.<br />
INSURANCE COMPANIES<br />
Profits of <strong>in</strong>surance companies are liable to corporation tax similar to all other<br />
companies except <strong>in</strong> the case where the corporation tax payable on taxable profit of life<br />
<strong>in</strong>surance bus<strong>in</strong>ess is less than 1.5% of the gross premium. In this case the difference is<br />
paid as additional corporation tax.<br />
ADMINISTRATION AND COMPLIANCE<br />
Tax Year: The tax year is the calendar year. The accounts of a company may be closed on<br />
a date different from 31st of December, <strong>in</strong> which case taxable profits are apportioned<br />
on a time basis relevant to the tax years.<br />
CONSOLIDATED RETURNS<br />
Taxation on a consolidated basis is not permitted and each company is required to<br />
submit a separate standalone tax return. A set-off of group losses is possible provided<br />
there is a 75% parent subsidiary relationship, <strong>in</strong>clud<strong>in</strong>g subsidiaries under 75% control<br />
of a common parent company. Group loss relief is available only between resident<br />
companies (and EU-based companies/companies with which <strong>Cyprus</strong> has concluded a<br />
double tax treaty, provided that they have exhausted all options to utilize the losses <strong>in</strong><br />
their country of residence).<br />
FILING REQUIREMENTS:<br />
Corporate tax returns must be filed electronically by the 31 st of March of the year<br />
follow<strong>in</strong>g the year under consideration (i.e. 15 months from the year-end). Companies<br />
are required to pay provisional tax <strong>in</strong> two equal <strong>in</strong>stalments by 31 st of July and 31 st of<br />
December of the year under consideration. Any underpayment is due to be settled<br />
via self-assessment by 1 st of August of the follow<strong>in</strong>g year. If the <strong>in</strong>come declared for<br />
the payment of the provisional tax is lower than 75% of the actual <strong>in</strong>come as f<strong>in</strong>ally<br />
determ<strong>in</strong>ed, an additional tax equal to 10% of the difference between the f<strong>in</strong>al and<br />
provisional tax is payable.
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UNITED KINGDOM EDITION<br />
PERSONAL INCOME TAX<br />
BASIS OF TAXATION<br />
All <strong>Cyprus</strong> tax residents are taxed <strong>in</strong> <strong>Cyprus</strong> on all <strong>in</strong>come accrued or derived from<br />
all sources <strong>in</strong> <strong>Cyprus</strong> and abroad such as employment <strong>in</strong>come, rental <strong>in</strong>come etc. (i.e.<br />
worldwide <strong>in</strong>come).<br />
Individuals who are not tax residents of <strong>Cyprus</strong> are taxed on <strong>in</strong>come accrued or<br />
derived from sources <strong>in</strong> <strong>Cyprus</strong>.<br />
An <strong>in</strong>dividual is tax resident <strong>in</strong> <strong>Cyprus</strong> if one of the follow<strong>in</strong>g conditions are met:<br />
• he/she spends physically <strong>in</strong> <strong>Cyprus</strong> over 183 days dur<strong>in</strong>g the relevant tax year, or;<br />
• he/she does not rema<strong>in</strong> <strong>in</strong> any other state for one or more periods which altogether<br />
exceed 183 days <strong>in</strong> the same tax year and he/she is not tax resident <strong>in</strong> any other<br />
state for the same tax year and all the follow<strong>in</strong>g conditions are cumulatively met:<br />
• he/she should rema<strong>in</strong> <strong>in</strong> <strong>Cyprus</strong> for at least 60 days dur<strong>in</strong>g the tax year<br />
• he/she should pursue any bus<strong>in</strong>ess <strong>in</strong> <strong>Cyprus</strong> and/or to work <strong>in</strong> <strong>Cyprus</strong> and/or to<br />
be a director <strong>in</strong> a company tax resident <strong>in</strong> <strong>Cyprus</strong> at any time dur<strong>in</strong>g the tax year<br />
• he/she should ma<strong>in</strong>ta<strong>in</strong> a permanent residence <strong>in</strong> <strong>Cyprus</strong>,<br />
which can be either owned or rented by him/her<br />
The personal <strong>in</strong>come tax rates that apply to <strong>in</strong>dividuals are as follows:<br />
Taxable Income Tax Rate (%) Tax (€) Accumulated Tax (€)<br />
0-19,500 0 0 0<br />
19,501- 28,000 20 1,700 1,700<br />
28,001-36,300 25 2,075 3,775<br />
36,301-60,000 30 7,110 10,885<br />
60,001 and over 35
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UNITED KINGDOM EDITION<br />
TAX INCENTIVES FOR EXPATRIATE EMPLOYEES TAKING UP EMPLOYMENT IN CYPRUS<br />
The <strong>in</strong>dividuals who were non-Cypriot tax residents prior to the commencement of<br />
their employment, but become Cypriot tax residents afterwards, are eligible for a 50%<br />
exemption from <strong>in</strong>come tax if all the follow<strong>in</strong>g conditions are met:<br />
• their remuneration from the employment exercised<br />
<strong>in</strong> <strong>Cyprus</strong> is over €55,000 per annum; and<br />
• they were not tax residents of <strong>Cyprus</strong> for 15 (or 10, subject to conditions)<br />
consecutive years prior to the commencement of their employment; and<br />
The exemption is available from 1 January 2022, it is granted from the first year of<br />
employment and it can be enjoyed for a period of 17 years.<br />
Individuals with annual remuneration below €55,000 who were non-Cypriot tax<br />
residents <strong>in</strong> the 3 years preced<strong>in</strong>g their employment, are eligible for a 20% exemption<br />
from <strong>in</strong>come tax (maximum exempt amount is €8,550 per year). The exemption<br />
is available from the 1 st of January follow<strong>in</strong>g the year of commencement of the<br />
employment and can be enjoyed for a period of 7 years.
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UNITED KINGDOM EDITION<br />
SUBMISSION OF TAX RETURNS<br />
The tax year is the calendar year. Tax on employment <strong>in</strong>come is withheld by the<br />
employer under the PAYE system and remitted to the tax authorities.<br />
Self-employed <strong>in</strong>dividuals pay tax through the provisional and self-assessment<br />
systems. Tax returns must be filed electronically by 31 st of July follow<strong>in</strong>g the tax year<br />
for employees, 30 th of September for self-employed persons who are not required<br />
to file audited/reviewed f<strong>in</strong>ancial statements and 31 st of March of the year follow<strong>in</strong>g<br />
the year under consideration (i.e. 15 months from the year-end) for self-employed<br />
persons whose returns are accompanied by audited/reviewed f<strong>in</strong>ancial statements.<br />
Sole proprietors with an annual turnover of more than €70,000 are obliged to prepare<br />
f<strong>in</strong>ancial statements that are either audited or are subject to a review by a statutory<br />
auditor (<strong>in</strong> case their net turnover does not exceed the amount of €200,000 and the<br />
total value of the assets without deduct<strong>in</strong>g liabilities does not exceed the amount of<br />
€500,000).<br />
VALUE ADDED TAX<br />
Imposition of Value Added Tax (VAT) is imposed on the supply of all goods and services<br />
<strong>in</strong> <strong>Cyprus</strong>, on the acquisition of goods from other Member States and on the importation<br />
of goods from third countries. The standard rate of 19% applies to the supplies of all<br />
goods and services <strong>in</strong> <strong>Cyprus</strong> which are not subject to the zero rate, the reduced rates<br />
(3%, 5% and 9%) or are not exempt. <strong>Cyprus</strong> constitutes an attractive EU VAT jurisdiction<br />
apply<strong>in</strong>g several options permissible by the EU Directive, among others, a flexible VAT<br />
Group<strong>in</strong>g. As long as the pre-requisite l<strong>in</strong>ks are satisfied, and governmental revenues<br />
are not put <strong>in</strong>to jeopardy, related entities can form a VAT group disregard<strong>in</strong>g <strong>in</strong>tra-group<br />
transactions and hav<strong>in</strong>g a representative member submitt<strong>in</strong>g a s<strong>in</strong>gle VAT return.<br />
SPECIAL CONTRIBUTION FOR DEFENCE<br />
Limassol Seafront<br />
Special contribution for defence (SDC) is imposed on the dividend, <strong>in</strong>terest and rental<br />
<strong>in</strong>come earned by Cypriot tax resident and domiciled <strong>in</strong>dividuals. Non-domiciled<br />
Cypriot tax residents are exempt from SDC.
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UNITED KINGDOM EDITION<br />
KEY FEATURES OF THE CYPRUS TAX SYSTEM<br />
Simple, transparent and EU harmonised tax system<br />
follow<strong>in</strong>g recommended OECD practices.<br />
Enjoys the tax benefits of EU Directives (Parent – Subsidiary<br />
Directive, Merger Directive and Interest and Royalties Directive).<br />
Extensive Tax Treaty network with 68 countries.<br />
A corporate <strong>in</strong>come tax rate of 12.5%, one of the lowest with<strong>in</strong> the<br />
EU with possibility to enjoy a much lower effective tax rate.<br />
Availability of a Notional Interest Deduction for<br />
companies receiv<strong>in</strong>g new equity fund<strong>in</strong>g.<br />
The tax deduction can reach up to 80% of the taxable<br />
<strong>in</strong>come generated by the new equity.<br />
IP Box regime based on the nexus approach which allows 80% deemed<br />
deduction on qualify<strong>in</strong>g profits from the bus<strong>in</strong>ess use of qualify<strong>in</strong>g IP.<br />
Increased deduction of 20% on the actual expenditure <strong>in</strong>curred for scientific<br />
research as well as research and development, subject to conditions.<br />
Attractive Tonnage Tax (TT) regime for ship owners, managers and charterers.<br />
Attractive tax jurisdiction for funds and attractive<br />
tax regime for fund managers.<br />
Capital ga<strong>in</strong>s are exempt from tax (except for capital ga<strong>in</strong>s aris<strong>in</strong>g<br />
from the disposal of immovable property located <strong>in</strong> <strong>Cyprus</strong>).<br />
Profits of a foreign Permanent Establishment exempt from tax.<br />
Ga<strong>in</strong>s from trad<strong>in</strong>g <strong>in</strong> securities (shares, bonds and certa<strong>in</strong><br />
other f<strong>in</strong>ancial <strong>in</strong>struments) are exempt from tax.<br />
Unilateral credit relief for foreign taxes.<br />
No withhold<strong>in</strong>g tax on dividend, <strong>in</strong>terest or royalty payments (for<br />
use of royalties outside of <strong>Cyprus</strong>) made abroad, unless these are<br />
made to EU blacklisted jurisdictions (relevant conditions apply).<br />
No taxes on entry and on qualify<strong>in</strong>g reorganisations.<br />
Carry forward of tax losses for five years.<br />
Tax <strong>in</strong>centives for expatriate employees tak<strong>in</strong>g up<br />
employment <strong>in</strong> <strong>Cyprus</strong> (20%/50% exemption).<br />
Dividend <strong>in</strong>come and <strong>in</strong>terest <strong>in</strong>come are exempt from SDC for non-domiciled<br />
<strong>in</strong>dividuals tak<strong>in</strong>g up tax residency <strong>in</strong> <strong>Cyprus</strong> (eligibility for 17 years).<br />
Possibility to obta<strong>in</strong> <strong>Cyprus</strong> tax residency by spend<strong>in</strong>g<br />
only 60 days <strong>in</strong> <strong>Cyprus</strong> (subject to conditions).<br />
No <strong>in</strong>heritance tax.<br />
No immovable property tax.
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UNITED KINGDOM EDITION<br />
THE CYPRUS TRADE CENTRE (CTC) - LONDON<br />
The <strong>Cyprus</strong> Trade Centre (CTC) <strong>in</strong> London operates under the auspices<br />
of the <strong>Cyprus</strong> M<strong>in</strong>istry of Energy, Commerce and Industry as the<br />
commercial and economic arm of the <strong>Cyprus</strong> High Commission <strong>in</strong> the<br />
United K<strong>in</strong>gdom. It is one of the sixteen trade promotion missions of<br />
the Republic of <strong>Cyprus</strong> worldwide. The ma<strong>in</strong> objective of this office<br />
is to assist Cypriot enterprises <strong>in</strong> their endeavour to establish new<br />
and develop exist<strong>in</strong>g bus<strong>in</strong>ess l<strong>in</strong>ks <strong>in</strong> the United K<strong>in</strong>gdom with a<br />
particular focus on export<strong>in</strong>g capabilities, as well as to promote <strong>Cyprus</strong>’<br />
services sector and encourage foreign <strong>in</strong>vestment <strong>in</strong> the island.<br />
CORE ACTIVITIES<br />
Facilitate the liaison between bus<strong>in</strong>esses <strong>in</strong><br />
the United K<strong>in</strong>gdom and <strong>Cyprus</strong><br />
Develop trade <strong>in</strong> goods and services between<br />
British and Cypriot companies<br />
Promote <strong>Cyprus</strong> as an <strong>in</strong>ternational bus<strong>in</strong>ess and <strong>in</strong>vestment centre<br />
Provide reliable <strong>in</strong>formation and research studies on the British market<br />
Organise bus<strong>in</strong>ess events, trade delegations, press facility visits,<br />
participation <strong>in</strong> trade fairs and exhibitions <strong>in</strong> the United K<strong>in</strong>gdom<br />
CONTACT INFORMATION<br />
High Commission of the Republic of <strong>Cyprus</strong> Trade Centre<br />
13 St James’s Square<br />
London SW1Y 4LB<br />
United K<strong>in</strong>gdom<br />
Contact: Costas Dafos, Commercial Attaché<br />
T: +44 (0)20 7321 4141/+357 22651542<br />
F: +44 (0)20 7321 4169<br />
E: cdafos@cyprustrade.co.uk<br />
W: www.cyprustrade.com
THERE IS A PLACE WHERE…<br />
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on the ground.<br />
As the national <strong>in</strong>vestment authority, Invest<br />
<strong>Cyprus</strong> acts as a s<strong>in</strong>gle po<strong>in</strong>t of contact and one<br />
stop shop for exist<strong>in</strong>g and potential <strong>in</strong>vestors.<br />
Our dedicated team provides after care and<br />
facilitation services, <strong>in</strong>clud<strong>in</strong>g support<strong>in</strong>g you <strong>in</strong><br />
site selection, sett<strong>in</strong>g up offices, staff immigration<br />
and relocation procedures while cont<strong>in</strong>u<strong>in</strong>g to<br />
grow its extensive portfolio of available<br />
projects and <strong>in</strong>vestment opportunities.<br />
www.<strong>in</strong>vestcyprus.org.cy
TheProfilerGroup<br />
16, Elia Papakyriakou, Suite 101,<br />
Engomi, 2415 Nicosia, <strong>Cyprus</strong><br />
cyprus@theprofilergroup.com<br />
www.theprofilergroup.com<br />
www.cyprusprofile.com