Under Section 347 of the Companies Law (Cap 113), companies incorporated outside the jurisdiction of the Republic of Cyprus may register a branch in Cyprus. The registration procedure is to a large extent identical with the incorporation of a new company in Cyprus with the major difference being that the registration of a branch in Cyprus does not create a new legal entity in Cyprus. What this essentially means is that the legal entity, which is established under a different jurisdiction, has a branch in the Republic of Cyprus and it may operate through this branch for its international activities.
The branch of such overseas company acts as an agent of its parent company or under any status the parent company may choose to have.
Within one month of establishment, the overseas company bears the responsibility to submit to the Registrar the following documents
translated in Greek:
- Certified copy of the Overseas Company’s charter or of the Memorandum and articles of Association or any other instrument defining or containing its constitution. If such document is not in English then a certified translated copy must be filed as well.
- The particulars and details of the directors and secretary of the overseas company together with a catalogue of the persons who are authorized to represent the company
- The name and addresses of one or more persons who have a permanent residence within the jurisdiction of Cyprus and who are authorized to accept on behalf of the overseas company any legal documents or notices which are served on the branch.
Every foreign corporation that maintains a branch in the Republic must submit, for every financial year, copies of its financial statements as presented in its last AGM and published in accordance with the laws of the country of incorporation.
Benefits of International Business Branches
An international business branch registered in Cyprus benefits from all those advantages that international business legal entities benefit from. In relation to the tax rates that apply to branches; the following apply:
- If the management and control of the business of the branch is located in Cyprus, then the profits of the branch are subject to a reduced tax rate of 4.25%.
- More importantly, if the management and control of the business of the branch is not based in Cyprus, the profits of the branch are relieved from all taxes.
The Registrar of Companies is the competent Authority of this type of registration procedures. It should be stated here that it is a quick and a relatively straight-forward procedure and it takes approximately 1 week for it to be completed.