Why Open a FTZ Company in Cyprus?
Why Open a FTZ Company in Cyprus?Updated on Friday 27th March 2020
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Free trade zones (FTZ) in Cyprus represent a Customs institution utilized to encourage the external trade, through offering certain incentives for the storage and distribution of goods, therefore subsidizing the transit trade development.
In this article, our lawyers in Cyprus present the different advantages of opening an FTZ company in Cyprus. Our team can help you open a business in Cyprus in a Free Trade Zone.
Definition of free trade zones in Cyprus
FTZs in Cyprus constitute parts of the customs territory of the premises or community located inside that territory and separate from the other areas of the country, in which:
• Non-Community goods are taken into account, with the objective of import duties and commercial policy import measures;
• Community goods, as stipulated by the Community Legislation which rules those particular fields. Our Cypriot lawyers can provide more information on this subject.
How can a company operate in an FTZ in Cyprus?
The way in which a company may operate in an FTZ in Cyprus is as stipulated by the provisions of the Free Zone Law and the Free Zones (Administration and Control) Regulations, as well as the Free Zones Customs Regulations as modified in order to align with the EU Regulations.
An FTZ in Cyprus in located in Larnaca area, next to the airport, being opened since 1980. The goals of the opening of an FTZ are as follows:
• Attraction of foreign investors;
• Creation of employment;
• Increase of exports and influx of foreign currency;
• Use of the geographical location of Cyprus and the developed infrastructure. Our attorneys in Cyprus can offer further details related these matters.
The two control type II FTZs in Cyprus
The two control type II FTZs in Cyprus are the Larnaca Free Zone and the Free Port Areas of Limassol and Larnaca. Our lawyers in Cyprus can give you detailed information related to these two FTZs in Cyprus.
In the Larnaca Free Zone, companies which operate inside this FTZ have to comply with minimal customs formalities, being able to import machinery, plant, raw materials and equipment duty-free.
Their foreign employees have to pay only 50% of the usual rates on their income.
If you need to know more about the reasons why open a FTZ company in Cyprus, we invite you to get in touch with our Cypriot law firm.