Cyprus has a superior business infrastructure. This in connection with the widespread use of English on the island, and its legal system largely based on English law means that Cyprus is an efficient and attractive jurisdiction in which to conduct business.
The many local and international banks operating on Cyprus have set up Offshore Banking Units on the island and are equipped to assist both foreign and offshore companies.
The government has created business legislation that includes special offshore regimes for many businesses including insurance companies, shipping companies, and Offshore Financial Services companies. Nevertheless, the distinctions between œoffshore and œonshore companies were abolished in 2003.
Cyprus is used as the basis for international investors in managing and holding their investments and carrying out their business activities, either on a domestic or international level.
The following legal forms may be registered in Cyprus:
- Company with Share Capital (Limited Liability)
- Business Branches/Permanent Establishment
- General/Limited Partnerships
- European Company (SE)
- Foreign Company with registered and management office.
Benefits of using Cyprus Companies:
- The general tax exemption from dividends received from overseas entities.
- The favourable tax regime, the lowest corporate tax rate in EU.
- The broad tax exemption from the disposal of securities.
- No withholding tax on dividends received by foreign shareholders.
- Potential use by Cyprus Companies of EU funds.
- Benefits that could arise from the Parent-Subsidiary Directive and the Interest Royalty Directive.