August 25, 2011, 4:04 pm
Anyone who wants to set up a business in Cyprus needs to be aware of the rules mentioned in the Cyprus Company Law, cap. 113, which is considered to be inspired by the English Companies Act 1948. Anyway, there were some amendments to the Companies Law, which were introduced in 2000 and 2001. As a consequence, when an entrepreneur decides to incorporate a company in Cyprus, he must firstly choose the type of corporation he wants to set up and then follow the procedures of registration in the Cyprus Company Law.
TYPES OF COMPANIES
The types of companies that you will find stipulated in the Cyprus Company Law are Private Company limited by Shares, Public Company Limited by Shares, Company Limited by Guarantee, General Partnership, Limited Partnership and Sole Proprietorship. Articles of a Private company need to mention restrictions to the right of transferring its shares, number of members that cannot be higher than 50 and prohibitions of any public subscription to shares. A private company that is entirely owned by foreign investors can be called an offshore company or an International Business Company.
A Public Company Limited by Shares can be listed on the Cyprus Stock Exchange, according to the Company Law in Cyprus.
General and Limited Partnerships are regulated by Partnerships and Business Names Law, Cap. 116 and they must be registered at the Registrar of Partnerships. Sole proprietorships are also stipulated in the Partnerships and Business Names Law, being subject to the same regulations as any partnership.
When it comes to the formation of an International Business Company (IBC), the Cyprus Company law requires some information for proceeding with the registration. Two options of the company’ s name, main activities, proof of the initial capital deposit and full personal details of shareholders and directors are usually necessary for registration after being translated in Greek. The procedure does not take longer than three weeks.
As far as the employees are concerned, they are protected under the Cyprus Labour Law and EU acquis communautaire. Rights and obligations are stated in the Cyprus Labour Law, together with important specifications about the employment contract.