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[ESTABLISHING A BUSINESS ENTITY IN CYPRUS]
2. Steps and Timing to Establish 2.A Company
3. Governance, Regulation and Ongoing Maintenance 3.A Company Governance Companies operate in accordance with the provisions of the Companies’ Law and those in their memorandum and articles of association. The Companies’ Law provides for certain matters which are to be decided by the shareholders. Such matters include the change of the company’s memorandum or articles of association, the change of its name, the reduction of its share capital and its liquidation. It is possible by addition of provisions in the articles to require that further matters are to be decided by the shareholders, and/or to require higher majorities than those provided by the statute for the decisions of the shareholders to be passed. The way proceedings of the directors are to be conducted and the quorum and majorities required for their decisions are regulated by the provisions in the articles of association. The articles of association of a company may be amended by shareholders’ resolution passed with at least 75% majority of the persons entitled to vote and present at the meeting (subject to anything further that may be provided by the company’s articles of association). Minority protection Protection to minority shareholders is afforded by mandatory provisions in the Companies’ Law which cannot be bypassed by contract or provisions in the articles. Such provisions include the right to call meetings, to obtain certain information and to block the passing of decisions unless the majorities provided by the law are satisfied.
The incorporation of a Cyprus company is straight forward and comparatively easy. It can usually be completed in approximately one week to ten days. The company’s name must be first approved by the Registrar of Companies and thereafter, the memorandum and articles of association of the company signed by the shareholders together with statements signed by the directors are submitted for registration. 2.B Partnership A partnership exists from the day on which it commences business. It must inform the Registrar of Companies within 30 days of commencement so that its existence is registered. 2.C Fund Except where a fund is established as a “Registered Fund” where no licensing is required, in all other cases funds must obtain approval from the Cyprus Stock Exchange Committee. The application process is fairly simple and quick and can be completed within a couple or few months. 2.D Trust The trust is effective as from the time it is declared and signed by the settlor. The trust instrument must be stamped, and the trustee must notify the relevant competent authority (being either of the Cyprus Securities and Exchange Commission, the Cyprus Bar Association, or the Cyprus Association of Certified Accountants) within fifteen days from the creation of the trust, to lodge it in the Cyprus Trust Registry.
ILN Corporate Group – Establishing a Business Entity Series
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