Elias Neocleous & Co LLC

Cyprus Nestled in the eastern Mediterranean, Cyprus has long been a sought-after destination for investors seeking a strategic business foothold in Europe and beyond. With its rich history, favourable business infrastructure, strong economy, and appealing opportunities, Cyprus remains an attractive jurisdiction for both domestic and foreign entrepreneurs, organizations, and corporations. Business environment Changes in 2026 versus 2025 - What has changed in the last year that has impacted the way business is conducted? Over the past year, Cyprus has experienced several significant developments that have impacted the business environment: Political motivation EU Council Presidency 2026: Cyprus holds the EU Council Presidency  in the first half of 2026, focusing on strengthening EU strategic autonomy, migration management, internal security, and economic competitiveness. During this period, Cyprus will coordinate Council work, facilitate legislative negotiations, and host key EU meetings, raising the island’s visibility in European policymaking. Economic Indicators and Fiscal Policy Inflation and Fiscal Surplus: Inflation continued to stabilise, remaining low at around 1.2% in January 2026 and 0.9% in February 2026, down from 2.2% in 2024 and 3.9% in 2023. Cyprus recorded one of the lowest inflation rates in the euro area,· (1) reflecting strong price stability driven partly by declining energy prices and modest increases in services and food. The country also maintained a strong fiscal surplus, contributing to overall economic stability. (2)   Tourism Sector Record-Breaking Tourism Figures: In 2025, Cyprus’ tourism sector continued its strong performance, with over 4.5 million visitor arrivals in 2025,(3) and record tourism revenues of €3.69 billion,(4) representing a 15.2% increase from €3.2 billion in 2024. This sustained growth highlights the sector’s robust post-pandemic recovery and underscores its critical role in the national economy, contributing to roughly 14% of Cyprus’ GDP.   Tax reform Cyprus implemented a comprehensive tax reform that came into effect on 1 January 2026, introducing a more modern, transparent and predictable tax framework aligned with EU standards. Corporate Tax Adjustment: As part of the 2026 tax reform, Cyprus increased the corporate income tax rate from 12.5% to 15%, aligning with the global minimum tax framework while maintaining one of the most competitive corporate tax rates within the European Union. Reduced Taxation on Dividends: To balance the corporate tax increase and enhance Cyprus’ attractiveness for investors, the Special Defence Contribution (SDC) on dividends has been significantly reduced from 17% to 5%. In addition, the deemed dividend distribution rules for profits generated after 1 January 2026 have been abolished, simplifying the tax system and improving predictability for businesses. Attractive Intellectual Property (IP) Regime: The reform maintains Cyprus’ highly competitive Intellectual Property (IP) regime, which continues to provide substantial tax advantages for companies engaged in research, development and innovation, reinforcing the country’s position as a regional technology and innovation hub. Introduction of Crypto-Asset Taxation: The reform also introduces clearer rules for digital investments through the implementation of an 8% flat tax on gains from the disposal of crypto-assets, with the ability to offset losses within the same tax year, providing greater certainty for investors in the rapidly growing digital asset market. Abolition of Stamp Duty: The reform also provides for the full abolition of stamp duty, reducing transactional and administrative costs for businesses and individuals. This measure simplifies documentation requirements and improves the ease of doing business, particularly for commercial agreements and financial transactions.   What are the advantages of your country as a business location? Cyprus boasts a strategic geographical position, situated at the crossroads of Europe, Asia, and Africa, making it a prime location for businesses seeking entry into these lucrative markets. This unique positioning presents a wealth of opportunities for international enterprises. Additionally, Cyprus offers an appealing tax system with one of Europe's lowest corporate tax rates at 15% and an extensive network of double tax treaties. Further, the country has introduced a favourable Intellectual Property (IP) regime that provides tax incentives for companies holding IP rights, reducing their effective tax rate to a very low level, resulting in one of the most competitive IP tax regimes in Europe for IP-related profits.Such tax advantages make Cyprus an enticing choice for foreign investors seeking to optimize their financial profiles. Additionally, the country is included on the OECD’s whitelist of jurisdictions and has also received positive credit rankings in 2023 from Fitch (BBB), Moody’s (Baa2) and S&P (BBB). Cyprus also finds its long-term credit rating 3 grades above the minimum investment threshold, specifically at BBB High and BBB+ by DBRS Morningstar and the Germany-based agency Scope Ratings. The island further stands out due to its well-developed infrastructure, including modern telecommunications, global ports, and international connectivity. A skilled and educated workforce, proficient in English, strengthens Cyprus's appeal for companies seeking to establish their operations. Beyond this, Cyprus diversifies its business sectors, extending well beyond traditional domains like tourism and real estate. Thriving in sectors such as ICT, fintech, shipping, renewable energy, entrepreneurship and innovation, investment funds, filming, and higher education, Cyprus's economic prospects remain robust. Moreover, its straightforward legal system simplifies business establishment and operation. Furthermore, Cyprus offers accessible residency programs for foreign investors, allowing them to secure residency through varied investment opportunities. Lastly, Cyprus's European Union (EU) membership opens doors to the EU's market and free trade with other member states, enhancing its business attractiveness on a global scale. What are the business structures in your country? Private limited liability company by shares Such a company has share capital, and the liability of its members is limited by its memorandum of association to any unpaid amount for the shares they hold respectively. A private limited liability company by shares must have at least one (1) shareholder but no more than fifty (50), exclusive of any persons who are or have formerly been in the employment of the company and are or still continue to be members of the company. A private limited liability company cannot offer its shares for subscription to the public. This is the most common type of company. Public limited liability company by shares This company has share capital and the liability of its members is limited by its memorandum of association, to any unpaid amount for the shares they hold respectively. A public limited liability company may invite the public to subscribe for its shares and may be listed on the stock exchange. The number of members of a public company must be at least seven (7). The minimum authorized and issued capital of a public company, which is offered for subscription, must be twenty-five thousand, six hundred and twenty-nine euros (€25,629). Limited liability company by guarantee without share capital This type of company does not have share capital and its members act as guarantors rather than shareholders. The liability of its members is limited by its memorandum of association, up to the amount that the members have undertaken to contribute respectively to the assets of the company in case of dissolution. Limited liability company by guarantee with a share capital This company has share capital and the liability of its members is limited by its memorandum of association, on the one hand, up to any unpaid amount for the shares they hold, and on the other, up to the amount that its members have respectively undertaken to contribute to the assets of the company in case of dissolution. This type of company can be either private or public company. If it is a public company, it can invite the public to subscribe for its shares. Variable capital investment company This company is a limited liability company by shares. The main characteristic of this type is that, according to its memorandum of association and the rules governing its operation, its shares do not have a nominal value but rather a variable value. The company can be incorporated after it receives a relevant license from the Cyprus Securities and Exchange Commission (CySec) to operate as Collective Investment Funds (CIF). A variable capital investment company (VCIC) can take the form of either a private or a public company, depending on the type of collective investment fund (CIF) that such variable investment company will take (UCITS, AIF, AIFLNP, RAIF). The number of members of a private company can range from one (1) to fifty (50) members while the number of members of a public company must be at least one (1). General Partnership In a general partnership, all partners are general partners and therefore every partner is jointly and severally liable with all the other partners for the debts and obligations of the partnership that arise while he/she is a partner. A general partnership must have at least two (2) partners. Limited Partnership A limited partnership must comprise of one (1) or more persons who will be the general partners and shall be responsible for all the debts and obligations of the partnership, as well as one (1) or more persons who shall be the limited partners who will contribute a certain amount or property, valued at a specific amount to the partnership and to which persons a specified number of shares may be assigned. Limited partners are not liable for the debts and obligations of the partnership beyond the amount they have contributed. A limited partnership may have a share capital and be limited by shares. Regardless of whether it has share capital or not, a limited partnership is not considered as a legal entity with an independent legal personality.   Economy Currency strength Cyprus adopted the Euro as its official currency on 1 January 2008. The Euro is one of the top 10 strongest currencies in the world and is the official currency of 20 out of the 27 countries that form the European Union. Euro coins and banknotes entered circulation in 2002, and the currency is free-floating. Inflation rates Inflation (HICP) in Cyprus has continued to moderate in recent years. Annual inflation declined to 2.2% in 2024, down from 3.9% in 2023, reflecting easing price pressures. More recent data show inflation remaining relatively low, with the Harmonised Index of Consumer Prices (HICP) rising by 1.2% in January 2026 compared with January 2025, before easing further to 0.9% in February 2026. These figures indicate a continued stabilisation of prices, supported in part by declining energy costs and moderate increases in services and food prices. Main trade sectors Tourism remains a cornerstone of Cyprus' economy, with 2025 marking a record-breaking year for visitor arrivals and revenue. The sector welcomed over 4.5 million tourists and generated approximately €3.69 billion in revenue, representing a significant increase compared with 2024. The government continues to promote Cyprus as a premier travel destination, leveraging its rich history, picturesque landscapes, and strategic Mediterranean location. Despite the sector’s strong performance, continued instability linked to the Middle East conflict involving Iran may pose potential risks to Cyprus’ tourism industry. However, bookings remain stable and there are currently no indications of widespread cancellations. Real estate remains a strong driver of economic activity, attracting both domestic and foreign investment. Cyprus' property market showed resilience in 2025, with 19,304 property transfers worth €4.55 billion, slightly up from 19,155 transactions worth €4.12 billion in 2024.(5)Limassol, in particular, remains a hotspot for commercial and residential property development, with high-end projects catering to international buyers. The financial services sector continues to thrive, with banks, insurance companies, and investment firms benefiting from Cyprus' favourable regulatory and tax environment. The funds industry has seen exponential growth, attracting a diverse range of international investors. The ship management industry also remains robust, contributing significantly to the economy. Cyprus’ shipping sector accounts for around 7% of the country’s GDP and employs more than 9,000 people onshore, as well as about 80,000 seafarers on vessels managed by Cyprus-based companies. The sector continues to strengthen Cyprus’ position as a global maritime hub, ranking 12th worldwide in fleet capacity and flag according to the United Nations Conference on Trade and Development (UNCTAD).(6) The energy sector has continued to advance, with Cyprus strengthening its role in the Eastern Mediterranean’s evolving energy landscape. The government’s strategy focuses on expanding renewable energy, developing LNG import and regasification infrastructure, promoting regional electricity interconnections, and advancing the exploitation of offshore natural gas reserves. Cyprus has recorded six significant gas discoveries in its Exclusive Economic Zone, including Aphrodite, Calypso, Glaucus, Cronos, Zeus and the recent Pegasus discovery, with development plans for key fields progressing in cooperation with international partners. At the same time, investments in solar power, energy storage and grid upgrades are supporting the country’s transition toward a cleaner and more secure energy system in line with EU sustainability objectives.(7) Technology and innovation have become major economic drivers, with Cyprus emerging as a regional hub for fintech, ICT services, and digital businesses. The sector has expanded rapidly in recent years, with international IT, fintech, and cybersecurity firms establishing operations on the island and creating a growing ecosystem of high-skilled employment. According to industry estimates, the technology sector now represents a significant share of the economy, with ICT previously accounting for around 15% of GDP and generating approximately €4 billion in revenue. As Cyprus moves forward in 2026, these key sectors of tourism, real estate, financial services, shipping, energy, and technology are expected to continue shaping the country’s economic landscape. Strong growth in services,exports, rising foreign investment and the continued expansion of the technology ecosystem are reinforcing Cyprus’ role as a regional business and investment hub. Legal system How does the legal system operate? What should clients be mindful of when doing business in your jurisdiction? Cyprus is primarily a common law jurisdiction with a justice system which is based on the adversarial model. This is a legacy from its period as a British colony.  Much of Cypriot legislation is based on the UK law in force at the time Cyprus ceased to be a colony.  It is updated and amended regularly to ensure alignment with all relevant EU Guidelines and Directives. Where there is no applicable Cypriot legislation, English common law and equity are applicable, and English authorities have persuasive force.  The courts are bound by the doctrine of precedent according to which where the common law has been interpreted by the Supreme Court of Cyprus in a particular way, the subordinate courts will be bound by that interpretation. This offers the parties to a commercial action the advantages of consistency, predictability, and efficiency. Foreign investment restrictions Regulatory environment Cyprus, as an EU member state, operates within a regulatory framework that encompasses various sectors, each designed to promote economic growth, protect the rights of consumers and investors, and ensure compliance with international standards. In the financial realm, the Cyprus Securities and Exchange Commission (CySEC) oversees banking, insurance, and investment services, aligning the country with EU directives to maintain financial stability. The nation's competitive tax environment and the extensive double taxation treaties position Cyprus as an attractive hub for international businesses, and the government actively combats tax evasion and money laundering. Moreover, Cyprus upholds robust labor regulations and fosters fair working conditions, while consumer protection measures are in place to safeguard consumers' rights. The regulatory landscape here extends to environmental protections, legal systems, and data privacy, with an overarching commitment to EU standards. Cyprus also ensures a conducive environment for business operations and investment. The Department of Registrar of Companies and Official Receiver facilitates the registration of various business entities, welcoming foreign investment. In the real estate and construction sectors, regulations maintain construction quality and safeguard buyer rights, while in the telecommunications and IT domains, regulatory bodies ensure competition, service quality, and data protection. These efforts are complemented by a robust legal system based on English common law principles, providing the legal foundation for contracts, property rights, and dispute resolution. In response to global concerns, Cyprus has implemented comprehensive measures in areas such as anti-money laundering and counter-terrorism financing, aligning its regulations with international standards and EU directives. Additionally, the country complies with the General Data Protection Regulation (GDPR), ensuring the privacy and security of personal data. In healthcare and pharmaceuticals, Cyprus adheres to EU standards in the delivery of healthcare services and the regulation of pharmaceutical products. Overall, Cyprus' regulatory environment reflects its commitment to maintaining a thriving economy, protecting individual rights, and adhering to international norms in various sectors of governance. Direct Investment and Foreign Investment Screening The Cyprus government has historically encouraged foreign direct investment (FDI) to diversify the economy. The tax regime has played a key role in making Cyprus one of the most attractive destinations in Europe for individuals, investors, and businesses. There are currently no general restrictions on ownership or investment in Cyprus, and no capital controls exist; travelers must only declare cash sums exceeding EUR 10,000 upon arrival, in line with EU rules. On 2 April 2026, Cyprus formally implemented the EU FDI Regulation (2019/452), introducing a national FDI screening mechanism to monitor and control foreign investments in strategically important enterprises, particularly in sectors sensitive to national security, critical infrastructure, and key economic activities. Key definitions under the law include: Foreign Direct Investment (FDI): Any investment by a foreign investor aiming to establish or maintain lasting links with an entity in Cyprus, including investments enabling effective participation in management or control. Control of an Undertaking: The ability to exercise decisive influence through ownership of at least 25% of voting rights or assets, or via contracts or other means allowing control of management decisions. Strategically Important Enterprise: Any entity engaged in particularly sensitive sectors as defined in the Regulation, including companies, partnerships, associations, foundations, trusts, or foreign-established entities operating or supplying goods/services in Cyprus. Foreign Investor: Any natural person who is not an EU, EEA, or Swiss national, or any non-EU enterprise, making or intending to make an FDI. The new law establishes a clear FDI review process, enhancing investor certainty and enabling proactive cooperation with EU institutions. While the legislation marks a significant step in regulatory clarity, caution remains. Retrospective EU reviews may still occur, and ongoing risk assessment and client advising are essential for foreign investors.   (1) (https://cyprus-mail.com/2026/03/03/cyprus-records-lowest-inflation-in-eurozone-as-prices-stay-flat) (2) (https://cyprus-mail.com/2026/02/25/cyprus-inflation-slows-to-1-2-per-cent-as-energy-prices-fall) (3) (https://cyprus-mail.com/2026/03/04/record-2025-for-eu-and-cyprus-tourism-shadowed-by-threat-of-regional-instability) (4) (https://cyprus-mail.com/2026/03/02/cyprus-tourism-revenues-hit-record-e3-69bn-in-2025) (5) (https://knews.kathimerini.com.cy/en/comment/opinion/cyprus-property-market-2025-more-cash-unexpected-winners) (6) (https://knews.kathimerini.com.cy/en/business/cyprus-shipping-charts-a-course-for-growth) (7) (https://www.gov.cy/en/speeches/keynote-address-by-the-minister-of-energy-commerce-and-industry-of-the-republic-of-cyprus-mr-george-papanastasiou-at-the-eastern-mediterranean-energy-conference-and-exhibition-emc-2025/#:~:text=1.,with%20more%20exploration%20to%20come.)

Background Since gaining independence from the UK in 1960 Cyprus has transformed itself into a successful, modern international business centre. A Member State of the European Union (‘EU’) since 2004, it provides a gateway for investment into and from Europe and, due to its geographic location, it enjoys strong commercial ties with Eastern Europe, the Middle East, Asia and Africa.   A consequence of this is that commercial disputes frequently involve international parties at corporate and individual levels. Additionally, where main court or arbitration proceedings take place in another EU Member State or in a third country with which Cyprus has a bilateral agreement or has ratified an international agreement, it is common where a link exists, for the parties to  seek for provisional measures in Cyprus in support of the foreign court proceedings.  The commercial disputes arising are varied and may be linked to issues such as negligence, fraud, contractual disputes, corporate disputes, etc. The dominant means of settling large commercial disputes in Cyprus is via litigation; however, recently arbitration and mediation have also gained popularity. Until September 2023, there was often negotiation before and during court proceedings, but no legal obligation  or expectation that the parties  would engage in such discussions unless they have specifically agreed to do so. However, since September 2023, with the implementation of the new Civil Procedure Rules, the parties in a dispute are obliged to engage in discussions with the aim to amicably settle such disputes before proceeding to the pursue of a Claim before the Courts of Justice.  Alternative dispute resolution methods (“ADR”) are a relatively new concept, other than in the construction and co-operative institutions sectors, but they do exist. Cyprus is primarily a common law jurisdiction with a justice system which is based on the adversarial model. This is a legacy from its period as a British colony.  Much of Cypriot legislation is based on the UK laws in force at the time Cyprus ceased to be a colony.  It is updated and amended regularly to ensure alignment with all relevant EU Guidelines and Directives.  Where there is no applicable Cypriot legislation, English common law and equity are applicable, and English authorities have persuasive force.    The courts are bound by the doctrine of precedent according to which where the common law has been interpreted by the Appellate Court and the Supreme Court of Cyprus in a particular way, the subordinate courts will be bound by that interpretation.   This offers the parties to a commercial action the advantages of consistency, predictability and efficiency. Problems Despite the apparent attractiveness of the Cypriot legal system to national and international business it has, since the 2008 financial crash, been heavily criticized as an obstacle to the commercial growth of the island.  It should be stressed that this criticism does not stem from a real or perceived lack of integrity or independence on the part of the judges.  Rather, it is directed at the enormous backlog of cases pending before the courts and the average time it takes to get a final judicial decision in any given case.  Whilst the courts are generally efficient in determining applications for interim relief, final adjudication in a case can commonly take between three and six years to obtain. A functional review of the justice system in 2017/18 supported by the EU Structural Reform Support Service (SRSS)[1] found that the length of court proceedings was among the longest in the EU, and the level of backlogs in litigious civil and commercial cases among the highest.  Such delays run contrary to the democratic nature of the EU which, along with the Cypriot government, citizens, and businesses adopts the view that ‘justice delayed’ is ‘justice denied’.  Working with the EU and its representative bodies Cyprus determined that problems in the justice system were primarily caused by: A large increase in cases and appeals being brought before the courts as a consequence of events linked to the financial crash. A lack of support resources within the system. The use of legal officers to support judges in the research and drafting of judgements was very limited. An increase in the complexities of the cases brought in before the courts. An unrestricted right of appeal. Reliance on a paper-based system with very minimal use of ICT for internal or external communication resulting in significant inefficiencies and, inter alia, a management information deficit. Steps Taken The reaction of the Cyprus government to the findings of the SSRS was twofold.  Firstly, it determined that there was an urgent need to begin addressing the backlog of existing cases.  Secondly, it realised that the entire justice system was in need of radical reform. Case Backlog To help facilitate a reduction in the backlog the first step taken was a decision to increase the overall capacity of the justice system by increasing the number of judges.  The House of Representatives passed a 2019 budget which included the creation of 32 new judges.  Following on from this, a pilot project was introduced in the Paphos District Court.  The project involved the assignment of seven experienced judges to a ‘task force’ dedicated to reducing the case backlog.  The theory was that the experience level of the judges would allow them to assess the cases with relative speed.  The pilot was deemed to be beneficial and was expanded in September 2021 to cover all districts. Moreover, the distribution on the backlog cases has been changed allowing all backlog cases to be heard simultaneously and be promoted in parallel. In addition, an amendment was made to Civil Procedure Rules which established a ‘small track’ procedure.  This allowed for the introduction of a simplified process for claims under €3,000 which has now been increased to €10,000.  This increased the case management options available to judges by allowing them to give summary judgments on the lower value cases and thereby accelerating the speed with which they could be dealt with. Reform of Justice System It was clear from a series of EU backed reviews that a wholesale redesign of the system was required. This required detailed planning and necessitated the involvement and ‘buy in’ of all stakeholders in the system.  Consequently, and with the support of the European Commission for Democracy through Law, a period of comprehensive consultation and review took place with the cooperation of all stakeholders. The result of this exercise was the production, in 2021 of a coherent plan (the Plan) to reform the Cypriot justice system with the object of building a modern, accessible and efficient system. The key pillars of the plan are: New Civil Procedures Rules Training for judges Reform of the court structure Introduction of technology In its entirety the plan represents a seismic change for the Cypriot justice system.  The implementation of the plan is mostly completed and many parts of it featured in the post covid ‘Recovery and Resilience Programme of Cyprus’ (the ‘RRP’). New Civil Procedures Rules The Civil Procedures Rules (the ‘CPR’) which were in use until the end of August 2023, were substantially in the form of the Civil Procedures Rules that operated in England and Wales in 1958. The revision of the CPR was one of the most significant reforms included in the Plan. The project was undertaken by a team of international experts who worked in collaboration with a Rules Committee established by the Supreme Court. A revised set of rules drafted by them was then subject to consultation with the Cyprus Bar Association and the Judge’s Association.  Following this, on 19 May 2021 the new CPR were approved by the Supreme Court and came into force on 1st of September 2023. This reform has had a material impact on the efficiency of the courts, as it is structured in such a way that many disputes could be resolved at a pre-trial stage and unsubstantiated legal procedures are discouraged. In addition, firm compliance with the new CPR has achieved the granting of justice in a much faster pace and without the delay currently experienced, with significant reduction of legal costs. Training for Judges Obviously, the introduction of the new CPR and the adoption of new technologies will only be successful if judges are adequately trained in their use.  Consequently, following the enactment of the relevant law 14 August 2020 a training school for judges was established.  This formalises training for the new justice system and will also support ongoing training of judges.  It is envisaged that, in line with many other professions, judges are now required to engage in continual education for their period of tenure.  This move to a higher level of professionalism follows on from a decision taken by the Supreme Court in 2019 to publish the criteria for the recruitment of judges and for the promotion of judges.  Said criteria were set following a study undertaken by the DG Reform of the European commission. Within the framework of the RRP a commitment was made to ensure that at least 110 judges had completed annual training on the new CPR and various other agreed topics and skill by the 4th quarter of 2025.  According to the Ministry of Justice and Public Order this target had already been surpassed by 31 January 2023. Reform of Court Structure Prior to the proposed reforms, the Supreme Court sat at the apex of the court system in Cyprus. The Supreme Court consisted of 13 members, and it exercised both original and appellate civil and criminal jurisdictions. It was vested with authority as: Supreme Constitutional Court. Supreme Administrative Court. Admiralty Court. Appellate Court. A court with exclusive jurisdiction to hear and determine petitions concerning the interpretation and application of the electoral laws. A court with exclusive jurisdiction to issue prerogative writs (e.g. habeas corpus, mandamus, prohibition, quo warranto, and certiorari). No special leave to file an appeal was required. The Supreme Court, in its appellate jurisdiction, was not bound by any determination on a question of fact made by the trial court, and it had power to review all the evidence, draw its own inferences, hear or receive further evidence and give any judgment or make any order which the circumstances of the case may have justified, including an order for retrial. The wide jurisdiction of the Supreme Court and the increasingly specialized knowledge required to deal with many of the cases before it created perfect conditions to foster a bottleneck in the justice system.  Changes were required to disperse the workload and ensure that the more complex cases were dealt with by judges with the appropriate skills and expertise. On 7 July 2022, the House of Representatives voted (the 22nd amendment) for: The separation of the Supreme Court into two Supreme Courts: one Supreme Constitutional Court with 9 judges and one Supreme Court with up to 7 judges. The creation of a new Second Instance Court, i.e. the Court of Appeal (Appellate Court). The Appellate Court hears appeals from the First Instance Courts (administrative, civil and criminal) and is comprised of up to 16 judges. The new Supreme Court acts as a third level appellate court hearing cases referred to it by the Appellate Court. Additionally, on 12 May 2022, the ‘Establishment and Operation of Commercial Court and Admiralty Court Act 2022’ (‘the Act’) was passed. The Act establishes a dedicated Commercial Court which will have jurisdiction to hear and determine at first instance all commercial disputes where the amount or value in dispute is at least €2,000,000. Excluded will be claims or counterclaims in personal injury cases and claims, counterclaims, or registration of an arbitral award in relation to banking or financial matters. The Act also establishes an Admiralty Court which, once operational, will have jurisdiction to hear Admiralty cases as defined in the Act.  Given the rising importance of Cyprus as an international business and shipping hub, the introduction of these dedicated courts should significantly decrease the pressure on the Supreme Court.  Also significant is that, prior to the passing of the Act, the House of Representatives approved an amendment of Article 3 of the Constitution of the Republic of Cyprus to allow the use of English in both courts when to do so would be in the interests of justice. Greek will remain the official court language but a Judge of either court may, at the request of one of the parties, allow the use of English, including for the submission of documents and evidence. Since English is more widely spoken than Greek this should again increase efficiency by removing the need to always involve translators and certified translations of documentary evidence. Originally it was intended that the new court structure should become operational on 1 January 2023. This deadline was later extended to 1 July 2023 to allow more time for the recruitment and training of additional judges and court staff.  Whilst targets set out in the RRP have been exceeded the Supreme Court, the Justice Minister and the Attorney General agreed that fully staffing the new courts on the original deadline would have resulted in understaffing of the lower courts. Recently, further steps have been taken to enable functioning of the two special jurisdiction Courts, and they are expected to fully operate within the year 2026. Introduction of Technology Widespread introduction of technology into the justice system is essential if the system is to become and remain efficient and effective.  The failure to engage with technology led to a catastrophic situation during the Covid 19 lockdowns where the courts were forced to close because they lacked both equipment and expertise to function remotely. The Plan,therefore, incorporated the introduction of an i-justice platform as an interim step towards full engagement in the EU wide e-justice project.  The platform was launched on 21 July 2021 as a pilot version with the objective of streamlining legal processes.  The pilot was judged to be a success and use of the platform for commercial cases became obligatory from 1 February 2022. The full implementation of the system was preceded by thorough training and a sufficient period to allow users to build familiarity with the system.  Additionally, the Cyprus Bar Association (CBA), organized training points in the local bar associations, so that any difficulties of a technical nature could be resolved immediately and effectively.   The I-Justice platform aimed to bring together litigants, advocates, law firms, court staff and clerks, judges, the police and relevant governmental authorities so that justice is administered in an effective and practical digital environment.   The platform allows lawyers to: Submit claims remotely. Access electronic case files Pay fees and commissions remotely. Access up to date information about the progress of ongoing cases. Attend court appearances remotely, through the communication portal. Supplemental to the above, on 15 September 2021 the Supreme Court issued a court regulation, the so-called ‘e-Justice Procedural Regulation’. This regulates the handling of cases through electronic communication (emails) with the Court and allows but does not compel judges to handle cases without any physical presence. Use of the i-justice platform greatly simplified and sped up the operation of the court system in general with specific advantages accruing to those seeking to settle commercial disputes. It has eased the transition to the ‘e-justice’ platform which was implemented before the end of 2023.  Further modernization will involve the introduction of Digital Audio Recording of minutes to the courtroom which is still to be implemented.  Once this  will be fully implemented,  it will lead to time savings and greater efficiency. Mission accomplished? There can be no doubt that important progress has been made in the march to deliver a new justice system that will be fit for future generations.  The President of the Supreme Court and the President of the House of Representatives have both publicly stated that they expect the backlog of cases to be cleared within a 5-year period[2].  Within the RRP framework a commitment has been given by the Supreme Court to meet specific targets in the reduction of cases and appeals which have been pending for more than two years. An ex-President of the Supreme Court has been appointed to co-ordinate and monitor progress.  Some protests by members of the Cyprus Bar Association were recorded at the introduction of the possibility of summary judgements of small claims but these have not been sustained. The passage of the legislation introducing a new court structure was a significant milestone.  Whilst some disappointment has been expressed at the delay in the implementation of the new courts, criticism has been muted.  The general perception appears to be that it is better to ensure that all necessary resources are in place from the outset than to risk creating new problems to resolve.  It is, however, important for the economic future of Cyprus that the delay does not become a lengthy one. The introduction of formal training requirements for judges can only prove to be beneficial for all stakeholders in the system.  The same is true for the use of technology which finally allows the courts to move out of the 20th century. January 2023 saw the delivery of a report following completion of a project related to the establishment of a modern, efficient Court Service to support the management and administration of the courts.  It produced recommendations on re-engineering of procedures, organisational and governance structures and staffing requirements. These recommendations are now under consideration by the Supreme Court and the relevant Ministries and effectively form the final part of the ‘jigsaw’. Overall, provided momentum can be maintained, the signs are favourable for the creation of a justice system which is fit for Cyprus in the 21st century and which will be capable of adapting to future requirements.  Given that the EU has stressed that lack of reform is deterring investment in the country it seems unlikely that the desire for change will dissipate any time soon. [1] http://www.supremecourt.gov.cy/Judicial/SC.nsf/All/EBD26B775C1A627DC225843F0041884A/$file/Functional%20Review%20of%20Courts%20System%20of%20Cyprus%20(IPA%20Ireland)%20-%20Final%20Report%20March%202018.pdf [2] https://knews.kathimerini.com.cy/en/news/the-backlog-in-court-cases-will-be-alleviated-in-4-to-5-years https://knews.kathimerini.com.cy/en/news/the-backlog-in-court-cases-will-be-alleviated-in-4-to-5-years