The Legal 500

As per the previous VAT regulations in Cyprus yacht purchase and yacht leasing was subject to full rate of VAT at 17%. A lot of questions were raised justifiably when the yacht was not actually used within Cyprus and EU territorial waters.

The Sale of Immovable Property (Specific Performance) Law allows purchasers who deposit a stamped agreement for the sale and purchase of immovable property in Cyprus with the relevant District Land Registry within specified time limits to obtain specific performance of the contract if the seller subsequently fails to cooperate.

The Department of Merchant Shipping has published details of the amended government policy on ship registration under the Merchant Shipping (Registration of Ships, Sales and Mortgages) Laws 1963 to 2005. The amended policy has applied since October 15 2011. It simplifies, and in some cases relaxes, the earlier policy, which was in effect from July 1 2009.

The Department of Merchant Shipping has issued two new notifications under the Tonnage Tax Law (44(I)/2010).

The island now has the most modern and favourable trust regime in Europe

After years of falling behind, Cyprus has recently updated its law on international trusts to reflect changes in global investment practice. The following article examines the revisions involved from a tax perspective.

In March 2012 the Cyprus VAT Authority launched a special scheme making Cyprus as one of the most attractive EU jurisdictions for yacht registration. This new favorable VAT scheme requires a Cyprus company to enter into a lease agreement of a yacht with a third party, paying VAT only on a predetermined percentage of the time that the yacht is deemed to sail within EU waters, hence reducing the effective VAT rate down to only 4,42% when taking into account as well the required profit condition. - Kinanis LLC

In March 2012, the Parliament of Cyprus enacted the long awaited International Trust (Amending) law of 2012 effecting various structural changes to the International Trust law of 1992. The amendments were necessary to adapt the Cyprus law on International Trusts, to the current needs of international investors and at the same time strengthening the role of Cyprus as a trust jurisdiction.

In Ngassam v Republic of Cyprus via the General Director of the Ministry of Interior and the Attorney General of the Republic the Supreme Court recently ruled on the right of an HIV-positive illegal immigrant to remain in Cyprus.(1)

Property amnesty laws amended

Introduction 7-8