ILN: BUYING AND SELLING REAL ESTATE - AN INTERNATIONAL GUIDE

[BUYING AND SELLING REAL ESTATE IN CYPRUS]

91

Types of Business Entities The most common forms of business entities established in Cyprus are (a) limited companies; (b) partnerships; and (c) alternative investment funds. Further Cyprus international trust are also commonly formed by non-Cypriot investors and high net worth individuals. ✓ Private Company limited by shares Cyprus companies are registered under the Companies Law, Cap 113 as amended. The private company limited by shares is the most common form of entity established in Cyprus. It has a legal personality separate and distinct from its shareholders with the liability of shareholders limited to the unpaid amount of their subscribed shares. There is no requirement for a share capital and generally there is no restriction as to its availability to carry on business activities even where its share capital is small. ✓ Public Company limited by shares A public limited liability company is similar to a private company in terms of its features. It must have at least seven shareholders and a minimum share capital of Eur. 25.629. Unlike a private company, a public company is permitted to make offerings to the public and can be listed on the stock exchange upon satisfying certain criteria. ✓ Partnerships

of the partnership. In a limited partnership at least one partner is treated as a general partner and has unrestricted liability for the partnership’s obligations with the other partners having limited liability up to the amount contributed (or remaining unpaid) by them to the partnership. ✓ Fund With the enactment of the Alternative Investment Funds Law of 2018, Cyprus has modernized its legal framework regulating the registration and operation of alternative investment funds (AIF’s). The Law permits the registration of AIFs which are self – managed (by their board of directors) or externally managed by a fund manager and may be registered with unlimited number of persons or with limited number of persons, or as “Registered” AIFs. An AIF may be formed as a company with a fixed capital, a company with variable capital, a common fund or as a limited liability partnership with or without legal personality. ✓ Trusts and Beneficial Ownership The concept of “trust” is recognized under Cyprus law, and it is regulated by both statute and common law principles. Accordingly, real estate property can be made part of the trust estate and afford to the beneficiaries the rights that the settlor provides in the trust instrument. Trusts can be registered with the Land Registry Office over the real estate to which they relate to. The beneficiaries do not hold title over the real estate, as title is registered in the name of the trustee

Partnerships are regulated by the Partnerships and Business Names Law Cap 116, as amended, and they may form either as general partnerships or limited partnerships. In general partnership all partners have unrestricted liability for all obligations

ILN Real Estate Group – Buying and Selling Real Estate Series

Made with FlippingBook Online newsletter