Foreign Company operating in Cyprus

It must be clarified that a separate legal personality is not created simply because a foreign company operating in Cyprus registers with the registrar of companies. To create a separate legal personality a Cyprus private company limited by shares, or a Cyprus private company limited by guarantee should be formed in accordance with the provisions of the Companies Law, Chapter 113.

Prior to registration of a foreign company operating in Cyprus the place of operation and the legal representative must be selected. Once these two matters have been resolved the legal representative or the legal team entrusted with the registration must request a name approval from the registrar of companies.

Once the registrar approves the use of the foreign Company’s name then within 30 days of commencing operations the following process should be followed:

Form AE1:

Form AE1 is the main form entailing the registration with the local authorities.

• Provide the country of incorporation
• The address currently operating
• A certified copy of the internal rules. Certification should be in the form of an apostille or in the instance that the foreign jurisdiction does not participate in the Hague Convention on Private International Law then the document is to be certified by a competent foreign authority or a certified translation in case the document is in a language other than English.
• Register of the Director and Secretary including, in the case of an individual the name and surname, the ordinary address and nationality and in the case of a legal person, the business name and the registered address.
• Name and address of the legal representative

Form AE2:

Form AE2 is used to capture the details of the director and first secretary of the Company. The form requires that the following information is provided:

• Name and Surname
• Previous Names
• National Identity
• Profession
• Date of birth
• Nationality
• Address

Form AE3

Form AE3 is used to capture the details of the legal representative residing in Cyprus of the foreign company. The form requires:

• Name and Surname
• Previous Names
• National Identity
• Profession
• Date of birth
• Nationality

Address

A foreign company operating in Cyprus can hold assets, it can hire people, it can rent offices and even is able to acquire and hold real estate situated in Cyprus. Nevertheless the said agreements should be entered into in the name of the foreign company operating in Cyprus.

Annual Levy

Every year until the 30th of June companies registered with the registrar of companies in Cyprus must pay pay the annual levy amounting to Euro 350. if the company delays by 2 months, that is until the 30th of August of each year it is required to pay a penalty of 10%. If company pays the levy within 5 months the penalty will be 30%.

Financial Statements

The board of directors of a Company procure that a full set of financial statements are prepared in accordance to the International Financial Reporting Standards. Every foreign company operating in Cyprus must once a year prepare financial statements for the foreign company’s operations in Cyprus. The financial statements are presented to the general meeting, the latest within 18 months after its registration and thereafter once every year.

The board of directors is responsible for the maintenance of proper books and records which will be the backbone of the financial statements.

Exempt from the obligation to prepare financial statements are EU member state companies who are eligible in accordance with the national rules of the member state to do so. In this case the foreign company operating in Cyprus submits to the registrar of companies a certificate signed by the director and the secretary of the company is submitted.

The submission of AE1, AE2 and AE3 come at a cost of Euro 380 not including any third party fees, courier costs and out of pocket expenses.

The cost for requesting certificates from the registrar of companies amounts to Euro 40 per certificate not including any third party fees, courier costs and out of pocket expenses.

Upon submission of AE1, AE2 and AE3 the registrar will issue a certificate declaring that the Company has been registered and that it may operate in Cyprus. Furthermore a similar notice is made to the official newspaper of the Republic of Cyprus and the online website of the registrar.