The European Union is one of the most important players in the world economy and in international trade today. Therefore, it is very attractive as a base for business, for both individuals and companies. Cyprus is one of the EU states that offer a scheme where foreign investors – both individuals and corporations – can become citizens of the country, and therefore EU citizens as well.

Why Cyprus?

• EU and OECD Member state;
• Strategic location;
• Cost effective setting up and ongoing management of structures;
• Extensive network of double taxation treaties;
• Modern funds legislation and various regulatory bodies to facilitate investments;
• Mature business centre;
• Tax incentive schemes (see more details below).

Criteria

A. Financial Criteria – each applicant must meet ONE of the following criteria, either personally or via a company in which he is a shareholder or a senior executive and provided that the investment is being kept after citizenship had been granted:

a. The applicant must have invested at least €5 million for the purchase of Cyprus Government Bonds; or,

b. The applicant must have invested at least €5m for the purchase of financial assets of Cyprus companies (ie shares, bonds etc.); or,

c. The applicant must have invested at least €5m for the purchase or construction of property in Cyprus (including residential or non-residential property) ; or,

d. The applicant must have invested at least €5m for the purchase, creation or participation in businesses or companies that are based and operating in Cyprus and employ at least 5 people; or,

e. The applicant should have a private, or via a company or trusts connected to him, €5m placed in deposits at Cyprus Bank with a 3 years duration; or,

f. Any combination of the criteria above (a-e); or,

g. Major Collective investments: regarding this term, the council of ministers can reduce the aforementioned amount to €2.5m provided that the applicant participates in such collective investment of at least €12.5m.

B. Mandatory Terms: these terms include all of the following: (1) clean criminal record; (2) no freezing order has been issued in relation to the applicant’s assets within the EU; and (3) applicant must hold a permanent-privately owned residence in Cyprus, the value market of which must be at least €500,000 plus VAT.

C. Family members (if applicable): a spouse and any dependent children (not exceeding the age of 28 and provided that they intend to study or are in process of studying) may apply without the need of meeting the financial criteria. The procedure is quite similar to the main applicant subject to the exempt from the Financial Criteria.

Procedure

In order to examine each application, various documents must be submitted as follows (non-exhausting list):

• Letter by the applicant or a representative on his behalf in which the investment criterion under which the applicant applies is briefly explained;
• Application form duly completed and signed before a registrar of the Cypriot court or court officer;
• Birth certificate;
• Passport;
• Marriage certificate (if applicable);
• Clean record certificate
• Relevant documents depending on the type of investment;
• If the applicant is connected to a company as defined above, additional documents are required.

It should be noted that with regards to birth certificate and marriage certificate these documents must be issued by the country of birth and/or marriage. These documents must be presented in original format with apostil and their official translation in English again with apostil.

In the case where the issuing country has not signed the Hague convention, then the document (birth certificate or marriage certificate) needs to be certified by the Ministry of foreign affairs of the issuing country and the nearest Embassy or consulate of Cyprus in that country.

It should also be emphasized that as per Cyprus Ministry of council’s decision, disabled dependents of a main applicant are also eligible to apply regardless to the fact that they are unable to work nor engage in any kind of activity (provided they are under the age of 28).

Taxation

One of the salient points regarding the Cypriot citizenship scheme is that applicants may enjoy, once granted certificate of naturalization, major tax benefits as followed:

• 1. Exemption on tax on dividend income;
• 2. Exemption from the deemed dividend distribution;
• 3. Exemption from tax on interest income;
• 4. Exemption from tax on any rental income;
• 5. Other tax benefits regarding CGT and Income Tax may also be granted.

In order to be entitled to these benefits, a new legislation has been made to distinguish between those domiciled in Cyprus and those who are not (ie both physically and residents for tax purpose). The latter group will be exempt as indicated above even if the relevant applicant resides in Cyprus once granted his certificate of naturalization and such exemption will be granted for 17 years!

How can we help you gain your Cypriot passport through the program?

The lawyers at Porat Group deal and have been dealing with Cyprus as a jurisdiction for several years, dealing with a range of different legal issues, including regulation for Forex trading and other financial industries as well as nominee services, just to name a few and therefore are well acquainted with the country and its’ laws.

The law firm has many professional partners in the country, from banks, financial networks, lawyers, international accountants, tax advisors, regulatory bodies and others and can therefore provide consultation and professional services for a range of matters related to Cyprus, including Cypriot Citizenship by investment.

We are happy to give any potential clients more detailed information on applying for the Citizenship Program, and offer free, non-committing consultations on the matter.