Areas of Practice

Cyprus a Strategic Services Center

The Government of Cyprus a few years back began offering incentives in order to encourage the establishment of legal entities by foreign persons for the purpose of managing their overseas affairs or to provide services abroad from the island. Since then a large number of such entities which have become popularly known as international business companies or "IBCs", have been established in Cyprus. Today the island is a well established and highly respected centre for the conduct of commercial, professional, financial and maritime activities within the region and around the world.


The contents of the following pages are for the purpose of general information only.


For any specific information in connection with the regulatory framework fiscal considerations relating to the operation of companies, tax advantages and other relief's and benefits which derive from domestic Cyprus Legislation and from Cyprus double tax treaties, please apply for further information.

 

Cyprus is situated in the eastern Mediterranean close to the busy trade routes linking Western Europe with the Arab World and the Far East.


The island has a Mediterranean climate with about 300 days of sunshine the year round. The coldest month is January with a minimum mean temperature of 4°C. The hottest month is August with a maximum mean temperature of 36°C.


The population of Cyprus is about 700,000 of which 82 percent are Greek Cypriots and 18 percent are Turkish Cypriots. The official languages are Greek and Turkish but almost everyone speaks English as a second language. English is widely used in commerce and government.

 

The structure of Government is similar to other western democracies where human rights, political pluralism and private property are safeguarded. The Republic's Constitution is largely modeled on the American Constitution. As a result, executive, legislative and judicial powers are exercised by separate and independent bodies.


Cyprus is a member of the United Nations, the Commonwealth, the Council of Europe and a member country of the European Union.


The island has two international airports which are situated near Larnaca and Paphos some 50 and 150 kilometers, respectively from Nicosia. There is a wide network of air-routes connecting Cyprus with Europe, Africa and Asia.


The island is among the most developed countries of the world in telecommunications. Cyprus has automatic telephone connection with 121 countries, or 95 percent of the world's telephones.


The legal tender is the Euro. Its ultimate market maker is the European Central Bank.


The banking system consists of   commercial banks and a large number of offshore banking units (OBUs) and specialized financial institutions and Cyprus Investments companies. Commercial banking arrangements and practices follow the British model. Strong correspondent networks are maintained around the world by onshore and offshore banks. Most of these banks subscribe to SWIFT, Reuters Monitor, Telerate and other services.


Cyprus has an open free market economy. The role of government is limited to regulation, indicative planning and the provision of public utilities.


Trade, tourism and services in general are the economy's most important sector. In particular, earnings from tourism and services have consistently grown faster than exports. Over 60 percent of tourist arrivals originate in the European Community.