On 15.10.2021, the Government of the Republic of Cyprus, formally announced its new Action Plan for attracting foreign businesses to establish or expand their activities in Cyprus.
President Nicos Anastasiades, emphasized the Government’s hopes of making Cyprus a sustainable business and trade centre of the broader region and Europe. More specifically, he noted that the new Action Plan has taken into account the best business practices from other major European countries.
The structure of the new Action Plan is mostly focused on sectors related to technology, shipping, innovation, research and development technology biogenetics and biotechnology without excluding any other companies that choose Cyprus as their place of business.
The date of implementation of the new Action Plan has been set to 01.01.2022.
The list of new incentives includes:
- The setting up of a “Business Facilitation Unit” – The existing Fast Track Business Activation mechanism for companies of foreign interest shall be transformed into a new “Business Facilitation Unit” for foreign companies operating in Cyprus or for foreign companies that wish to expand their operations in Cyprus.
- A Revised Policy for Issuance of Residence and Employment Permits – Revision of the policy for the employment of highly skilled personnel from third countries which are employed by companies of foreign interests, as well as for those employed by Cypriot companies which give added value to the economy and the local workforce.
- Introduction of family reunification rights to third country nationals – family reunification rights are granted to third-country nationals employed by the above Revised Policy and regulated by the Business Facilitation Unit.
- Simplification of the process of granting work permits under CATEGORY E – Long Term Resident Status to persons who have been offered permanent employment and whose employment does not create undue local competition.
- The introduction of Digital Nomad Visa – Those entitled to such visas will be third country nationals who are either self-employed or are employees who work remotely using information and communication technologies to communicate with their clients or employers who must be outside Cyprus.
- The introduction of various new tax incentives – Several legislative proposals concerning the granting of tax benefits and tax breaks will be submitted to the House of Representatives by the end of December 2021. The government is hopeful that these proposals shall be approved by the first quarter of 2022.
- New Proposed Naturalisation Procedure – Proposal for the right to submit an application for naturalisation after 5 years of residency and employment in the Republic instead of the 7 years rule as applicable today or a further reduction to 4 years if the potential applicants meet the criteria of holding a recognised certificate of very good knowledge of the Greek language.
The legislation of the Action Plan regarding the tax incentives will be expected to be submitted to the Cyprus Parliament by the end of December 2021 with the aim to be approved during the first quarter of 2022.
Our Team will be closely monitoring all developments related to the new Action Plan.
For further information and/or enquiries, please contact us on cgv@vasslaw.com
