Geographic location and history at a glance

Cyprus is an island located in the eastern Mediterranean Sea at the crossroad of Europe, Asia and Africa. This strategic geographical characteristic has made Cyprus the hub of the three continents throughout the ages. Its history goes back to the 70th Century BC. Cyprus Greek culture and civilisation was founded well before the 10th century BC. Since then Cyprus has come under the influence or control of nations and peoples that have exercised power in the area, the last of which was the British. Cyprus became independent in 1960. Cyprus is a member to the United Nations, the Commonwealth, the Council of Europe, the World Bank and the International Monetary Fund. Cyprus' great international aim for accessing the European Union was achieved on 13th December 2002 at the Copenhagen Summit.

Population
Its estimated population is 760.000 of which 85,2% belongs to the Greek Cypriot Community and 11,6% to the Turkish Cypriot Community the remaining being foreign residents.

The Language
The official languages are Greek and Turkish. English is widely used in communications and commercial transactions.

The Three Authorities
The President who is elected for a 5-year term of office heads the Republic of Cyprus. The Council of Ministers the members of which are appointed by the President exercises the executive power. The House of Representatives is the Legislative Authority. The Judicial Authority lies with the Supreme Court that operates both as appellate and constitutional. District Courts function in every District.

The Legal System
Whereas Cyprus's legal system is based on Common Law, elements of the Continental Law have been introduced since the independence especially in the field of the administrative control.

The Economy
The economy leading sectors are those of tourism and services that decisively contribute to the GNP. Cyprus's economy has performed real growth and low inflation rates. (Per capita Gross National Product is about US$14.000).

The Currency and Finance
Cyprus currency is the Cyprus Pound (Cy£). The Central Bank, the ultimate market maker of currency, and the Commercial Banks, the banking units and the financial institutions constitute the banking system that operates with correspondent networks world-wide. The Cyprus Stock Exchange operates since 1996.

The Human Resources
Cyprus ranks among the leading countries in terms of the proportion of university graduates and has a well-trained and versatile work force.

The Transport and Telecommunications
Cyprus is connected with the continents through a wide network of air-routes, through its two international airports, that of Larnaca and Paphos. The sea transport is served by the ports of Limassol and Larnaca and the land transport by a network of highways and secondary roads. Cyprus is a regional hub in telecommunications and provides advanced telecommunication services.

Opportunities
Inward Investment

• There are no exchange control restrictions applicable to direct and portfolio investments by physical or legal persons from EU member states. However, in the banking sector the EU participation is restricted to 50% of the equity capital. There are also restrictions regarding the acquisition of immovable property, the establishment of radio and television stations and the provision of utilities.
• Non-EU investors may invest in companies listed on the Cyprus Stock Exchange up to 49% of the equity capital. As far as investments in other types of companies are concerned, there are certain restrictions especially with regard to the maximum percentage and/or the minimum amount of participation depending on the investment sector. Restrictions on equity participation in the banking sector and on acquisition of immovable property apply equally to non-EU investors.

International Business

• The term International Business Company (IBC), though extinguished since the Cyprus Tax Law Reform of 2002, refers to any legal entity whose beneficial ownership and business activities lie outside Cyprus. There are currently around 14.000 IBCs registered in Cyprus. Cyprus' business environment and supporting as well as administrative facilities compare favourably with those of the best international business centres around the world.

Ship Ownership

• Cyprus ranks 6th with over 2.600 ships exceeding 26 million gross tonnage. The cost competitiveness of the Cyprus Ship Registry, the island's well developed maritime infrastructure and the high standard of services offerred render Cyprus as one of the leading international maritime centres of the world.
• The fees payable by Cypriot registered vessels are low and may be favourably compared with those of other flags. Ship owners are initially attracted to the Cyprus Register by the inexpensive registration and annual fees and the excellent services offered. Other important incentives are:
  • No tax on profits from the operation of a Cypriot registered vessel or on dividends received from a ship owning company.
  • No capital gains tax on the sale or transfer of a Cypriot registered vessel or the shares of a ship owning company.
  • No estate duty on the inheritance of shares in a ship owning company.
  • No income tax on the emoluments of officers and crew.
  • No stamp duty on ship mortgage deeds or other security documents.
  • Double tax treaties with various countries.