Friday, 6 November, 2015

Increased demand for redomiciliation to Cyprus

Following international developments and regulations of the OECD, EU and other relevant authorities, more corporations are focusing on structures which incorporate the use of onshore companies, as opposed to those from offshore jurisdictions. In connection with this, there has been increased demand for both new incorporations and the redomiciliation of existing offshore companies to onshore jurisdictions in Cyprus.

A so-called offshore company may redomicile to Cyprus and continue its operations under the laws of Cyprus, without winding up the company in its current jurisdiction. This will open new opportunities to investors and foreign companies who can take advantage of the company’s operation in its current jurisdiction and at the same time benefit from being part of the EU. Companies that redomicile become a Cyprus-resident company and can benefit from the favourable taxation system offered by Cyprus and the EU.

It is important to note that redomiciliation can only be performed between two countries which both recognise the concept of redomiciliation between jurisdictions. This is outlined in the company law of each country. As an example, in the BVI, redomiciliation of BVI companies to another jurisdiction is regulated by Section 184 of the BVI Companies Act 2004. Redomiciliation procedures are generally the same across jurisdictions, but each may have particular differences. 

Procedure for redomiciliation of private companies

A company registered in an offshore jurisdiction which allows redomiciliation and whose memorandum and articles of association offer the possibility of redomiciliation may apply to the Registrar of Companies of Cyprus (the Registrar). The company will be registered in Cyprus as a ‘continuing company’ subject to the provisions of Cyprus company law.

The offshore company must appoint a local approved representative to assist with the redomiciliation process in Cyprus. The application to be filed with the Registrar must be accompanied by a number of documents including:

  • the memorandum and articles of association of the company
  • a certificate of good standing or equivalent document
  • a list of the current members and directors of the company
  • an affidavit by a director of the company confirming, among other things, that the company has notified the relevant authority in its current jurisdiction of its decision to redomicile to Cyprus.

Once the Registrar is satisfied that the documents provided comply with Cyprus law, it will issue a temporary certificate of continuation. This certificate confirms that the offshore company has redomiciled to Cyprus and can continue its business activities in line with the laws of Cyprus.

Within six months from the issue of the temporary certificate of continuation, the offshore company must present the Registrar with evidence from the offshore-relevant authority that it is no longer registered in the jurisdiction of its incorporation.

If this evidence is not provided, the Registrar may delete the name of the offshore company from its registry and inform the foreign authorities accordingly or the Registrar will allow a further three months for the documents to be submitted.

Once the Registrar is satisfied that the offshore company is no longer registered in its incorporation jurisdiction and after receiving the temporary certificate of continuation, the Registrar will issue a certificate of continuation, which confirms that the company is registered as a continuing company in Cyprus.

Additional information in special circumstances

Where an offshore company carries out activities requiring a licence

Where an offshore company carries out a licensed activity under the laws of its incorporation, it must gain consent from the relevant authority in the offshore jurisdiction that this activity can be continued in Cyprus. The company must obtain a similar licence in Cyprus (where required), subject to the requirements and provisions of the laws in Cyprus.

When an offshore company is a public company

When the offshore company is a public company, additional documents need to be submitted to the Registrar. This will include information relating to the most recent public offering and evidence that the relevant authorities regulating the stock exchange have provided their consent.  

 

This article is intended as a guide to the redomiciliation of an offshore company to Cyprus. If you are interested in redomiciling a company to Cyprus, please contact Gerard Jan van Spall

 

Contacts

Key Account Director,
+31 88 560 9665

Events

26 Sep
Monaco | 26 Sep - 29 Sep
Singapore | 27 Sep
Mauritius | 30 Sep
Mexico City | 4 Oct - 5 Oct
Luxembourg | 4 Oct - 5 Oct
Munich | 8 Oct - 10 Oct
Munich | 9 Oct
9 Oct - 10 Oct
Warsaw | 18 Oct
Dublin | 18 Oct
Chicago | 24 Oct - 25 Oct
London | 25 Oct - 26 Oct

Archive