Member Search

Criteria and Conditions for Granting of Cyprus Citizenship by Exception to Foreign Investors / Entrepreneurs

Published: Friday, May 29, 2015

A  non-Cypriot  citizen,  who  meets  one  of  the  following  economic  criteria  (A),  either  personally  or  through  a  company/  companies  in  which  he/she  participates  as  a  shareholder  -  proportionally  based  on  the  percentage  of  participation,  or  even  as  a  high-ranking  senior  manager  of  a  company/companies  that  meets  one  of  economic  criteria  (A),  may  apply  for  the  acquisition  of  the  Cypriot  citizenship  through  Naturalization  by  exception.

A  high-ranking  senior  manager  may  apply,  provided  that  he/she  receives  such  a  remuneration  that  generates  for  the  Republic  tax  revenue  of  at  least  €100,000  for  a  three  year  period  and  provided  that  this  tax  has  already  been  paid  or  prepaid.

The  applicant  should  have  concluded  the  necessary  investments  during  the  three  years  preceding  the  date  of  the  application  and  must  retain  the  said  investments  for  a  period  of  at  least  three  years  since  the  date  of  the  Naturalization.

In  addition,  the  applicant  must  fulfill  the  Terms  and  Conditions  set  out  in  Part  B.

In  the  case  where,  following  a  periodic  inspection,  it  has  been  ascertained  that  any  condition  is  being  circumvented,  the  Naturalization  may  be  revoked.

Α.  CRITERIA

Α.1  Investment  in  government  bonds:

The  applicant  must  have  purchased  state  bonds  of  the  Republic  of  Cyprus  of  at  least  €5,0  million.

or

Α.2  Investment  in  financial  assets  of  Cypriot  companies  or  Cypriot  organizations:

The  applicant  must  have  purchased  financial  assets  of  Cypriot  companies  or  Cypriot  organizations  (bonds/  securities/  debentures  registered  and  issued  in  the  Republic  of  Cyprus)  of  at  least  €5,0  million.

It  is  noted  that  these  financial  assets  can  be  purchased  either  at  issuance,  or  subsequently  by  the  market.

or

Α.3    Investment  in  real  estate,  land  development  and  infrastructure  projects:

The  applicant  must  have  made  an  investment  of  at  least  €5,0  million  for  the  purchase  or  construction  of  buildings  or  for  the  construction  of  other  land  development  projects  (residential  or  commercial  developments,  developments  in  the  tourism  sector  or  other  infrastructure  projects).

or

Α.4    Purchase  or  creation  or  participation  in  Cypriot  businesses  or  companies:

The  applicant  must  have  made  an  investment  of  at  least  €5,0  million  in  the  purchase,  creation  or  participation  in  businesses  or  companies,  that  are  based  and  operating  in  the  Republic.  These  businesses  or  companies  should  evidently  have  a  tangible  presence  in  Cyprus  and  employ  at  least  five  (5)  Cypriot  citizens.

It  is  noted  that  the  mandatory  conversion  of  deposits  into  shares  is  included  in  this  criterion.

or

Α.5  Deposits  in  Cypriot  banks:

The  applicant  must  have  personal  fixed  term  deposits  for  three  years  in  Cypriot  banks  or  deposits  of  privately  owned  companies  or  trusts  (in  which  he/she  is  the  beneficiary  owner)  in  the  Republic  of  Cyprus  of  at  least  €5,0  million.

or

Α.6  Combination  of  the  aforementioned  criteria  Α.1  (Investment  in  government  bonds),  Α.2    (Investment  in  financial  assets  of  Cypriot  companies  or  organizations),  Α.3  (Investment  in  real  estate,  land  development  and  infrastructure  projects),  Α.4  (Purchase  or  creation  or  participation  in  Cypriot  businesses  or  companies)  και  Α.5  (Deposits  in  Cypriot  banks):

The  applicant  is  required  to  have  a  combination  of  the  above  amounting  to  at  least  €5,0  million.

or

Α.7    Persons  whose  deposits  with  the  Popular  Bank  Public  Company  Ltd  have  been  impaired  due  to  the  measures  implemented  after  the  15th  March  2013:

The  applicant  has  incurred  an  impairment  in  deposits  amounting  to  a  total  of  at  least  €3,0  million.

In  the  case  where  the  applicant  has  incurred  an  impairment  in  his/her  deposits  under  €3,0  million  he/she  may  apply,  having  made  an  additional  investment  through  the  criteria  A.1  (Investment  in  Government  bonds),  A.2  (Investment  in  financial  assets  of  Cypriot  companies  or  Cypriot  organizations),  A3  (Investment  in  real  estate,  land  development  or  infrastructure  projects),  A.4  (Purchase  or  creation  or  participation  in  Cypriot  businesses  and  companies)  and  A.5  (Deposits  in  Cypriot  Banks)  for  the  balance  of  the  required  amount  of  the  aforementioned  criteria.

or

Α.8  Major  Collective  Investments:

The  Council  of  Ministers  shall  have  the  right  on  special  occasions,  to  reduce  the  above  criteria  (Α.1  (Investment  in  Government  Bonds),  Α.2  (Investment  in  financial  assets  of  Cypriot  companies  or  Cypriot  organizations),  Α.3  (Investment  in  real  estate,  land  development  or  infrastructure  projects)  and  Α.4  (Purchase  or  creation  or  participation  in  Cypriot  businesses  and  companies):

I.To  €2,5  millions  for  investors,  who  demonstrably  participate  in  a  special  collective  investment  scheme,  provided  that  the  total  value  of  the  investment  is  at  least  €12,5  millions.

II.To  €2,0  millions  for  investors  who  demonstrably  participate  in  a  special  collective  investment  scheme,  provided  that  the  total  value  of  the  investment  is  more  than  €12.5  millions.  It  is  noted  that  this  present  provision  (I),  will  be  in  force  until  the  1st  of  June  2014.

In  addition,  it  is  noted  that  for  the  above  mentioned  provisions  (Ι)  and  (ΙΙ),  the  investment  for  the  Criteria  Α1  until  Α4  may  be  realized  through  a  different  salesman/provider  (physical  or  legal  entity).

B.TERMS  AND  CONDITIONS

1.Clean  Criminal  Record:  the  applicant  must  have  a  clean  criminal  record.  Furthermore,  his  name  must  not  be  included  on  the  list  of  persons  whose  property  is  ordered  to  be  frozen  within  the  boundaries  of  the  European  Union.

2.  Residence  in  the  Republic  of  Cyprus:  In  all  cases  listed  in  Part  A,  the  applicant  must  hold  a  permanent  privately-owned  residence  in  the  Republic  of  Cyprus,  the  purchase  price  of  which  must  be  at  least  €500.000,  plus  V.A.T.

It  is  noted  that  members  of  the  same  family,  which  apply  separately  as  investors,  can  collectively  acquire  a  residence,  provided  that  the  total  value  of  this  home-property  covers  the  amount  of  €  500.000  per  each  applicant.

C.SUBMISSION  OF  DOCUMENTS

In  order  to  examine  any  applications  the  submission  of  the  form  (M127)  and  of  the  following  is  required:

1.Clean  Criminal  Record:

Certificate  of  Clean  Criminal  Record  from  the  country  of  origin  and  the  country  of  residence  (if  it  differs).

2.Residence  in  the  Republic  of  Cyprus:

(a)  Contract  of  Sale.

(b)  Title  Deeds/  Receipt  for  lodging  the  contract  with  the  Lands  and  Surveys  Department

(c)  Receipts  for  paying  the  agreed  purchase  price

(d)  Copy  of  the  wire  transfer  in  the  Cypriot  commercial  banking  institution  in  the  name  of  the  seller  or  the  seller’s  company

As  for  the  investment  Criteria  the  following  are  required,  depending  on  the  case:

(a)  Certificate  of  Registration  of  the  company/  companies  by  the  Registrar  of  Companies

(b)  Certificate  of  shareholders  by  the  Registrar  of  Companies  or  certificates  evidencing  that  the  applicant  is  the  beneficiary  owner  of  the  company/  companies

(c)  Audited  Accounts  of  the  company  (or  companies)  for  the  last  three  years  preceding  the  year  of  the  application

(d)  If  the  applicant  is  a  high-ranking  senior  manager  the  submission  of  the  employment  contract  and  the  receipt  from  the  Department  of  Inland  Revenue  is  additionally  required.

Any  other  document  that  might  be  requested  either  by  the  Ministry  of  Interior,  or  by  the  Ministry  of  Finance.

Furthermore,  depending  on  the  case,  the  following  are  required:

1.Investment  in  Government  bonds

(a)  Receipts  from  the  Treasury  of  the  Republic  of  Cyprus  for  the  purchase  of  the  Government  bonds.

2.Investment  in  financial  assets  of  Cypriot  companies  or  Cypriot  organizations

(a)  Title/titles  and  other  documents  regarding  the  financial  assets.

(b)  Copy  of  the  wire  transfer  in  the  Cypriot  commercial  banking  institution  in  the  name  of  the  company  or  the  organization

3.Investment  in  real  estate,  land  development  or  infrastructure  projects

(a)  Contract  of  sale.

(b)  Title  Deeds/  Receipt  for  lodging  the  contract  with  the  Lands  and  Surveys  Department

(c)  Receipts  for  paying  the  agreed  purchase  price

(d)  Copy  of  the  wire  transfer  in  the  Cypriot  commercial  banking  institution  in  the  name  of  the  seller  or  the  seller’s  company

4.Purchase  or  creation  or  participation  in  Cypriot  businesses  and  companies

(a)  Contract  of  sale.

(b)  Receipts  for  paying  the  agreed  purchase  price

(c)  Certificate  of  shareholders  by  the  Registrar  of  Companies  or  certificates  evidencing  that  the  applicant  is  the  beneficiary  owner  of  the  company/  companies

(d)  Copy  of  the  wire  transfer  in  the  Cypriot  commercial  banking  institution  in  the  name  of  the  company  or  the  organization

(e)  Confirmation  from  the  Social  Insurance  Department  as  to  the  insurable  income  of  the  Cypriot  employees  in  the  company

(f)  Confirmation  from  the  Inland  Revenues  Department  as  to  the  taxable  income  of  the  Cypriot  employees  in  the  companies  or  businesses  that  the  applicant  invested  in.

5.Deposits  in  Cypriot  banks

(a)  Confirmation  from  Cypriot  banks  as  to  the  fixed  term  deposits  for  three  years  of  the  applicant  or  the  companies  in  which  he  is  the  beneficiary  owner  or  of  the  trust  in  which  he  is  the  beneficiary  owner

(b)  Copy  of  the  wire  transfer  in  the  Cypriot  commercial  banking  institution

6.Impairment  of  deposits  in  the  Popular  Bank

(a)  Confirmation  as  to  the  level  and  the  time  of  the  impairment  of  the  deposits

(b)  In  the  case  of  deposits  of  companies  of  which  the  applicant  is  the  beneficiary  owner,  the  Certificate  of  Registration  of  the  Company  by  the  Registrar  of  Companies  and/or  any  other  evidence,  along  with  a  declaration  from  the  trustee  of  the  funds  confirming  the  beneficial  owner  is  to  be  attached

In  addition  to  the  above,  the  following  documents  should  also  be  provided:

  • Letter  in  which  the  investment  and  criterion  under  which  the  application  is  submitted,  are  briefly  explained;

  • Application  form  M127  fully  completed  and  signed  before  a  Registrar  of  a  Cypriot  court  or  a  consular  officer;

  • Certificate  of  birth;

  • Marriage  certificate;

  • Copy  of  passport;

  • 2  passport  size  photographs

  • Curriculum  vitae

  • Clean  criminal  record  from  the  country  of  origin  and  the  country  of  residence  ,  if  it  differs;

  • Letter  of  introduction  ie    CV,    details  of  residence,  family  status  (married,  children)  description  of  business  activities,  assets  worldwide  etc;

  • Title  deed  or  contract  of  sale;

  • Confirmation  that  the  contract  of  sale  has  been  submitted  to  the  Land  Registry;

  • Receipt  that  the  house  has  been  paid  in  full;

  • Copy  of  the  wire  transfer  in  the  Cypriot  commercial  banking  institution  in  the  name  of  the  seller  or  the  seller’s  company;

  • Arrival  and  departure  dates  from  the  Republic  of  Cyprus  in  order  to  reveal  a  connection  with  the  Republic,  although  this  is  not  a  requirement;

  • Evidence  of  the  monetary  requirements,  as  stated  above.

  • Copies  of  advertisements  in  a  daily  newspaper  two  consecutive  posts

If  the  applicant  is  a  high-ranking  senior  manager  the  following  documents:

(a)Copy  of  the  employment  contract

(b)Copy  of  the  receipt  by  the  Inland  Revenue  Department

There  is  no  requirement  that  the  house  is  of  a  minimum  size  or  that  the  applicant  has  ever  reside  in  the  house.    Actually  the  house  does  not  need  to  be  ready  to  live  in  at  the  time  of  the  application  but each  applicant  must  own  his  own  house.    The  value  of  the  house  is  not  included  in  the  €5.0  millions  if  the  applicant  is  applying  under  the  Direct  Investments  or  Combination  of  Direct  Investments,  Business  Activities  and  Deposits  in  Banks,  but  not  if  he  is  applying  under  the  Deposits  in  Banks.

BENEFITS:

A  person  who  is  a  Cypriot  citizen  can  travel  without  any  restrictions  to  the  EU  countries  but  not  to  the  Schengen  area  –  Iceland,  Norway  and  Switzerland  -  since  Cyprus  has  not  yet  implemented  the  Schengen  agreement.

The  spouse  of  the  applicant  automatically  is  naturalized  as  a  Cypriot  national.

His  juvenile  children,  as  well  as  any  children  above  18  that  are  considered  dependants  of  the  applicant,    they  are  also  naturalized  as  Cypriot  citizens  after  following  a  very  simple  procedure  and  provided  the  applicant  has  been  approved.

A  child  of  a  person  that  is  granted  the  Cypriot  citizenship,  who  is  over  18  years  and  is  not  considered  as  a  dependant  of  the  applicant,  is  also  allowed  to  stay  in  Cyprus  after  following  a  simple  procedure  for  the  gaining  of  entry  and  residence  permit.

The  fact  that  a  person  is  granted  the  Cyprus  citizenship  does  not  mean  that  he  is  considered  a  Cyprus  Tax  Resident.      An  individual  is  considered  to  be  tax  resident,  if  he  is  present  in  the  Republic  for  a  period  exceeding  183  days  in  a  tax  year.

BUSINESS  BENEFITS:

Cyprus  has  become  a  centre  through  which  many  leading  international  companies  conduct  their  business  activities.    Among  the  benefits  which  accrue  in  using  Cyprus  as  a  corporate  vehicle  are  the  lowest  corporate  tax  rate  in  Europe,  the  extensive  double  tax  treaty  network,  the  secure  environment,  its  reputation,  infrastructure  and  favorable  tax  provisions.

Any  application  is  subject  to  the  absolute  discretion  of  the  Council  of  Ministers  in  taking  a  decision.

The  above  is  brief  and  general  in  nature.    Kindly  contact  our  professionals  for  an  in depth  analysis  and  advice.


Andry Tryfonos
Suxess Management ltd
Country:
Cyprus
Practice Area:
Fiduciary
Phone Number:
+357 25730061
Fax:
+357 25730060

Member Introduction

The Lawyer Network in numbers

0+

Members Firms

0+

Countries

0+

Practice Areas

0+

Member Firms
Total Staff