Commercial Law in CyprusUpdated on Tuesday 22nd September 2015
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Company Law in Cyprus
The Cypriot law system is based on a mixture between the Anglo-Saxon system and the Continental one. The principal sources of law in Cyprus are the EU Directives, the constitution, the statutory laws and the judicial laws. The Cypriot commercial or company law falls under the Companies’ Law Chapter 113.
The company law states what a private company is how it is incorporated and dissolved and it also controls the Memorandum and Articles of Association.
The Cypriot company
Companies in Cyprus are divided into:
- · Public companies that require a minimum of 7 shareholders that can trade their shares on the stock market.
- · Limited liability company which is the most popular type of Cypriot company and it requires at least one shareholder and 50 maximum. The liability of the shareholders is limited at the value of the shares they own in the company.
- · Companies limited by guarantee are usually employed as non-profit organizations (NGOs).
- · Branch of a foreign company which is an extension of the parent company in Cyprus
- · The European Society or trust which is a company registered in an EU country that opens societies in other countries.
Registering a company in Cyprus according to the commercial law
When registering a company in Cyprus the following data must be provided:
- -The name of the company.
- -The activity of the company.
- -The share capital of the company. It must be noted that a start-up share capital of 1,000 euros is recommended for a private limited liability company.
- -Identification of the shareholders and directors.
- -Notarized copy after the owner’s passport.
- -Notarized copy after an utility bill of the owner.
After the approval of the name for the company is achieved, the Memorandum and Articles of Association are submitted with the Companies Registrar and in about 5 business days the company will have the certificates which will allow it to carry economic activities.
The staff of a Cypriot company
The Companies’ Law requires that every company has at least one director that can be a person or a legal entity. Even if it is not mandatory, it is advisable for the director to be a Cyprus resident for taxation purposes. The Cypriot commercial law also states the presence of a secretary which will be named by the Board of Directors of the company and it is advisable for the secretary to be a resident. The law requires a company to have at least one shareholder that can be an individual or a legal entity and to have a registered office in Cyprus.