Cyprus’ role in the development and conduct of international business can be traced back to ancient times to the eras of the Greeks, Phoenicians, Egyptians and the Romans. These nations realized the opportunities offered by Cyprus due to its strategic location which is situated at the crossroads of Europe, Asia and Africa. Because of this Cyprus became a key trading center in the regions and now became more developed and more familiar after the entrance in European Union on 1st of May 2004. This activity left its mark on the island and its people and since then it has become a promising tradition.
Today, Cyprus has become a well respected, international business and financial centre that provides significant benefits to International Entities and many unique opportunities for investors. Cyprus has a well developed business, legal and professional infrastructure, one of lowest crime rates in the world government commitment to the international business industry, an advantageous time zone, low operating costs, and generous tax incentives. These factors have all contributed to the phenomenal growth of the financial services industry a key part of which is the international business entities sector. Since 1975, when the concept of an international business entity was first introduced in Cyprus more than 50,000 permits have been issued for the registration of international business enterprises.
In July 2002 new tax legislation has been passed affecting a reform of the Cyprus tax systems. The tax reform fully complies with Cyprus commitment to the OECD to eliminate Harmful Tax Practices and is consistent with harmonizing laws to the EU‘s legal order and in particular the EU’s Code of Conduct and State Aid Rules. The many advantageous features of the new tax system combined with Cyprus network of double tax treaties, coupled with the full acceptance of the tax by OECD and the EU significantly enhance the reputation of Cyprus as an international business centre. Of particular importance is the fact that once the features of the tax reform are communicated to the administrations of OECD and non- OECD countries Cyprus will in due course no longer be subject to the defensive measures proposed by the OECD on harmful tax practices such as inclusion in black lists, non deductibility of expenses and other discriminatory measures.
Legal entities registered in Cyprus have a choice between operating from the offices of accountants or lawyers as “brass plate” entities or from their own fully fledged offices. More than 1,100 international business entities have opted to physically locate and administer their operations in Cyprus although such a presence is not required for the establishment or operation of an international business entity.
There are many significant benefits available to investors and entrepreneurs using Cyprus international business entities as vehicles for their international business activities. It is also intended to familiarize businessmen and professionals with certain legal and fiscal matters associated with the establishment and operation of international business entities. In practice, an investor may achieve optimum tax benefits by the use of only one Cyprus international business company. There may be cases where additional tax benefits can accrue by using a Cyprus international business company and another company in another jurisdiction. Our firms’ professional staff will be pleased to provide you with more information and professional advice in accordance with your individual needs.