Debt Collection in Cyprus and Internationally

The global economic crisis has also been extended to Cyprus and to the financial transactions taking place in Cyprus. Nowadays, liquidity is a major problem for all types of business, which their main concern is how to collect the debt owed to them.

Do you have clients that are not paying their invoices in a timely manner or refuse to pay at all?

Don’t waste your own time and resources trying to recover the debt owed to you.

Our Debt Collection Department offers debt collection services to clients in Cyprus and around the world. We combine professionalism and extensive experience within the legal process with a commercial and practical approach to debt collection. Our aim and priority is to offer honest and realistic advice to collect any debt owed to you or to your company, in the fastest and most amicable way.

We seek to avoid unnecessary litigation proceedings, thus we firstly contact debtors by formal letters of demand, which debtors take very seriously. In every case, we strive to achieve the most optimum results in the swiftest means possible.

Our lawyers’ help you navigate throughout the debt collection regulations in Cyprus and may accordingly perform negotiations on your behalf, locate debtor’s assets and initiate and/or enforce any legal action.

If you require assistance for a debt collection in Cyprus or abroad, we invite you to contact our Law firm.

The content of this article is intended to provide a general guide to the subject matter and does not constitute legal advice.

For any additional information, please contact us at [email protected] or at +357 22 42 11 90.

Cyprus Redomiciliation – A Global Solution

Cyprus Law permits the so-called “re-domiciliation” process allowing a company to transfer its “seat” of incorporation into, or out of Cyprus, in accordance with Companies (Amendment) Law of 2006, Law No. 124(I)/2006) (the “Law”).

This law provides a major advantage for a foreign company that can transfer its seat to Cyprus and perhaps later to any European country.

What is the Re –Domiciliation process?

 A re-domiciliation of a company is also known as a “transfer of seat”, which it refers to a procedure of a company transferring its seat of incorporation, to and from a jurisdiction.   The company continues to exist under the laws of a new jurisdiction, into which it transfers its seat, and ceases to exist under the jurisdiction of its incorporation.

It’s remarkable that this process provides a solution to the company to continue existence and not to be liquidated and incorporated from scratch to a different country. This allows an existing company to transfer its registered office and address to another jurisdiction by acquiring all the benefits there.

On a European level, the re-domiciliation of companies within the EU is not prohibited and each member state has its own strict regulations for the re-domiciliation process. However, Cyprus is included in the list of very few countries which allow the re-domiciliation of third-country companies (Non-EU) into and out of the Republic of Cyprus.

Why re-domicile to Cyprus?

Undoubtedly, Cyprus attracts a lot of foreign investors and international merchants as they gain a lot of benefits by either incorporating a Cyprus company or by re-domiciling their existing company to Cyprus. 

Some of the main advantages are below:

  • The foreign company continues to maintain its legal identity;
  • Cyprus is a member of the European Union;
  • Cyprus can be used as a key to transfer the foreign company in any other European country;
  • Cyprus has one of the lowest corporate tax rates in Europe;
  • Tax-exempt dividend income – (less stringent regulation and scrutiny);
  • There are no withholding taxes on payment of dividends, interest and royalties;
  • There is no taxation on profits from the sale of Securities;
  • There are widespread double tax treaties in force;
  • There is full adoption of the EC Directives.

What is the procedure to re-domicile into Cyprus?

The process to re-domicile a foreign company to Cyprus is simple from a practical perspective, as long as there is the appropriate guidance.

A lawyer is an essential part of this process as there is a need to prepare and submit documents both to the Courts of Cyprus and to the Department of Registrar of Companies and Official (the “Registrar”). 

The procedure to re-domicile a foreign company to Cyprus is divided to the bellow different parts:

  1. Company’s name approval;
  2. Application for re-domiciliation of the foreign company to Cyprus and submission of all the supporting documents;
  3. Issuance of Temporary Certification of the foreign company;
  4. Issuance of Permanent Certificate of Continuation.

Are there any restrictions?

It is crucial for a foreign company that intends to re-domicile in Cyprus or abroad, not to start any proceedings for its dissolution or have any pending court orders against it. If any of these exists, then the procedure of re-domiciliation may not be allowed by the Registrar.

Why should consider this process?

Cyprus is an attractive solution for investment and specifically for British enterprises and businesses. Our legal system is based on British Common Law and there are lots of similarities with UK companies’ law system, which arguably, investors can benefit from it.

Thus, as per the uncertainty caused by Brexit, Cyprus can be the key for many companies that wish to be based within the European Union, under a tax favorable system.

The content of this article is intended to provide a general guide to the subject matter and does not constitute legal advice.

For any additional information, please contact us at [email protected] or at +357 22 42 11 90.

Abolition of Bank Guarantees

According to the recent amendment of the Aliens and Immigration Law, which took place on  6.12.2019, the requirement for employers to submit to the Civil Registry and Migration Department in Cyprus a bank guarantee for the purpose of granting temporary residence and work permits to a third-country national, has been abolished.  

Further to the aforesaid amendment, the employer will instead have to submit a confirmation letter by which they will confirm that they are bound to incur any costs for the employee’s removal if such removal is necessary.

In cases where a bank guarantee has already been provided, or the amount has been made available to the Civil Registry and Migration Department, then this will be refunded upon submission of the required confirmation to cover any potential removal costs by the employer.

The aforesaid applies to third-country nationals who:

  1. possess a valid residence and work permit;
  2. have submitted an application for employment to a new employer;
  3. remain illegally in the Republic;
  4. remain with the regime of the asylum applicant.

If the employer refuses or fails to bear the removal costs of the third-country national, then the Director of the Civil Registry and Migration Department shall take legal action against them for the purpose of receiving the owed amount and, whilst the employer fails to incur the removal costs no new applications shall be examined for the employer in question.

For the release of a Bank Guarantee which has already been submitted or for the return of the amount of Guarantee which is available to the Civil Registry and Migration Department, the employer shall submit their confirmation letter before the Civil Registry and Migration Department or before the relevant local authorities.

The content of this article is intended to provide a general guide to the subject matter and does not constitute legal advice.

For any additional information, please contact us at [email protected] or at +357 22 42 11 90.