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.
Many local and international banks operating in 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 offshore and onshore 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, on a domestic and international level.
The following legal forms are mainly registered in Cyprus:
- Company with Limited Liability by shares (Private/Public)
- Company with Limited Liability by guarantee
- Business Branches/Representative offices
- General/Limited Partnerships
- European Company (Societas Europaea)
- Sole Proprietorship
- Trusts (Cyprus International Trust)
Benefits of using Cyprus Companies:
- Favorable tax regime, one of the lowest corporate tax rate in Europe at 12.5%
- Extensive network of double taxation treaties
- Tax-exempt dividend income (subject to applicable criteria)
- Broad tax exemption from the disposal of securities
- Tax-relief for group losses
- Potential use by Cyprus Companies of EU funds.
- Benefits that could arise from the EU directives ( Parent-Subsidiary Directive, Mergers Directive, Interest Royalty Directive, Directive on Mutual Assistance and Cooperation)