Main Features

2 Main Features

2.1 Principles of Equity

2.1.1	The principles adopted in relation to the Cyprus International Trust (“CIT”) are the English principles of equity and common law . The settlor places his assets under the control and ownership of the trustee, for the benefit of the beneficiaries, or for some other purpose of the trust.
2.1.2	The trust does not have a separate legal personality: the legal title to the assets is vested in the trustees, and the beneficial ownership is vested in the beneficiaries, resulting in a dual ownership.

2.2 International Trust Law 1992

2.2.1	In general, a CIT is merely a trust established in Cyprus pursuant to the International Trusts Law of 1992; this builds on the Trustee Law of 1955, which is almost a reproduction of the English Trustee Act of 1925.
2.2.2	The distinguishing features of a trust which is an International Trust are, first, that it is created by a settlor who is not a permanent resident of Cyprus. The settlor, the settlor’s spouse or the settlor’s children can be beneficiaries.
2.2.3	Secondly, the beneficiaries must be persons who are not permanent residents of Cyprus, save as to any charitable institution.
2.2.4	Thirdly, the trust property must not include any immovable property in Cyprus. It can include foreign real property or any personal property, whether situated abroad or in Cyprus – including shares in a Cyprus company.
2.2.5	Finally, at least one of the trustees must at all times be a resident of Cyprus. The trustee can be a legal or physical person. There is a proposed new Fiduciaries Law, providing that individuals or companies offering trustee or company management services must be authorised as fit and proper persons by the Central Bank of Cyprus.
2.2.6	For the purposes of this Memo it is assumed that the CIT has a single trustee, which is a Cyprus Trustee Company (“CTC”) incorporated and resident in Cyprus.