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Registration of a Branch of a Foreign Company in Cyprus

  • by Author
  • Oct 5
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Cyprus Branch Overseas companies, meaning companies that have been incorporated outside Cyprus, can conduct business in the ideal business environment that Cyprus has to offer, by establishing a place of business in Cyprus, in accordance with the Companies Law – Cap 113. The Part VIII of the Companies Law provides the legislative framework governing establishment and carrying out of business of branches of foreign companies in Cyprus.

Benefits

Registering a branch in Cyprus means that an Overseas Company can enjoy the same benefits that are in place for Cyprus companies, provided that the management and control of the branch office is in Cyprus, including: (a) Tax benefits; profits generated from the activities of the branch are taxed at a rate of 12,5%. (b) Power to hold immovable property in the Republic, as if the Branch were a Cyprus company. Whereas the management and control of the company is not in Cyprus, the profits generated from the activities of the branch are exempted from Cyprus tax and the profits will be taxed in the country of incorporation of the Overseas Company.

Required Documents

Overseas companies must submit, within one month from the date of establishment, to the Registrar of Companies the following documents in accordance with section 347 of the Cyprus Company Law Act:

(a) In relation to the overseas company

i. Particulars of the company and its activities;

ii. Certificate of incorporation;

iii. Memorandum and Articles of Association;

iv. Particulars of Directors, Secretary and Members; and

(b) In relation to the Cyprus Branch

i. Name and Address of at least one person who is ordinarily resident in Cyprus authorized to accept on behalf of the company any notices served to the company (authorized representative);

ii. Details of the registered office address in Cyprus;

iii. Name of the branch office is the same of the overseas company unless provide a different name for the branch office.

Whereas the Overseas company carries out regulated activities in accordance with the laws of Cyprus (investment, banking, insurance, engineering) a permit of the relevant authority is also required. All Certificates required in relation to the overseas company shall be original, ‘apostilled’ in the country of origin by a notary public and translated into Greek.

Obligations of the Overseas Company in relation to the branch office:

(a) Annual Filing Requirements

Unless exempted, an overseas company that has a branch office in Cyprus must file in every financial year to the Cyprus Company Registrar the following: its financial statements, director’s report and auditor’s report that were presented in its last Annual General Meeting. The overseas company is exempted from the Annual Filing Requirements provided that it is a small-medium enterprise registered in a member-state of the EU that falls within the meaning of the Directives of the European Union 2006/43/EC and 2013/34/EU. If the overseas company is exempt, it must deliver to the Cyprus Company Registrar a certificate signed by a director and the secretary of the company stating that it is an exempt company, the legal provisions of its home state that implement the EU Directives, as well as, a statement from the relevant authority of the home state providing that the said company is exempted pursuant to the said legal provision;

(b) Particulars of the Overseas Company

Overseas companies are obliged to expose distinctly in all of its invoices, notices, official publications and office letters the following: its name, country of incorporation and whether the liability of its members is limited by shares.

(c) Notifications and Service

Any notice that is sent to the overseas company by post or served to the authorised representative shall be considered as properly and sufficiently served to the said company.

Many shipping or ship management foreign companies choose to open a branch in Cyprus rather than to incorporate a new Cyprus company or to re-domicile in Cyprus, in order for them to maintain their International Maritime Organization (IMO) number.

Marina Daniel,

Trainee Lawyer

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