Cyprus company formation is a term used to describe the process of incorporation of a legal entity in the Republic of Cyprus which is commonly called the Company. The same term is also stated as company registration or incorporation.
Incorporating a company in Cyprus is comparatively easier and faster than in most other European countries. The process is initiated with an application for name approval and then registering a company is processed by Registrar of Companies. The company will be incorporated within 7-10 days.
Company formation includes the procedures and undertakings before the registration of the company. The company incorporation requires the preparation of the Memorandum and Articles of association, which includes the rules of the company and duties of the directors and shareholders. If a company formation and registration will be made by a law firm in Cyprus due diligence regarding the beneficial owners of a Company is mandatory before the registration.
Company formation procedure
The procedure for company formation in Cyprus begins with the appointment of a licenced lawyer who will undertake to prepare all necessary incorporation documents and register the company. Under the Cyprus Companies law only licenced Cyprus lawyers can prepare and sign the company registration documents.
The existence of each company begins with the issuance by Registrar of Companies of the certificate of incorporation.
The Department of Registrar of Companies
All the companies in Cyprus are registered at the Cyprus Registrar of Companies, which has the responsibility to keep the Register of Companies and which must be notified for any changes in the company.
Cyprus company name approval
The first step is to apply for approval of the desired company name. The company name includes at the end the abbreviation Ltd or Limited. The name must not be unreasonably similar to the name of an existing company.
Also only in special cases for valid reasons the following will be allowed:
- The words: national, international, democracy, Europe, Euro,
- Names should not include the words: cooperative, municipal, privileged, acknowledged.
- Names that include a primary name that is not the small name and/or the surname of one of the directors or shareholders will only be allowed if provided there are reasonable grounds for accepting them.
- Names containing the following words will only be allowed if where justified: Bank, Banking, Investing, Trust, Insurance, Broker.
- The name of an associated company is not accepted unless having written consent.
Usually, we recommend using unique names and adding initials of the owners in the front to get easier Cyprus company name approval from the register. In addition, we have a list of already approved company names, which can be used for immediate Cyprus company registration.
The name approval procedure takes 1-3 working days.
Required documents for Cyprus company registration
The Documents to be prepared by the lawyer and submitted to the Registrar of Companies for registration of a Cyprus company are the following:
- Articles of Association
- A statutory declaration by Lawyer (HE1)
- Forms HE2 and HE3
Articles of Association
Each Cyprus company's articles of association must provide the following:
- It must indicate the name of the Company as approved.
- It must state the business activities of the Company.
- The activities of the company cannot be illegal. A company has the right and authority to perform only those operations covered by the powers conferred on it by its articles. We recommend drafting the articles in broadway and adding additional activities so that the company can freely engage in additional business activities if required.
- It must state that its members' liability is limited.
- The company has separate legal personality, which in practice means that its members/shareholders have no personal responsibility in case of any issues the company might face.
- It must indicate the amount of share capital with which the Company intends to subscribe and its division into shares of a specified amount. The usual share capital used is 1000 ordinary shares of 1 euro nominal share value.
The Memorandum of a Cyprus company is the document that sets the rules which regulate the operations of the company. Together with the articles they bind the company and its members and are essentially an agreement of each member of the company to comply with the provisions of these two documents.
A statutory declaration by Lawyer (form HE1)
The form HE1 is an affidavit from the lawyer who confirms that he has prepared all the company documents according to the provisions of Cyprus company law.
Form HE2 – Company’s Registered office
The form HE2 provides the company’s registered office address. Every Cyprus company must maintain a registered address in Cyprus, this can be optionally offered as a service by the lawyer. In this address all notifications to the company can be officially served.
Form HE3 – Company Director and Secretary
The form HE3 provides the company’s officials, director and secretary. Each company must have at least one director and a secretary. Additional directors can be appointed.
The director can be any natural person or company and is not needed to be a shareholder of the company. The same applies to the secretary. Both the above might be offered as a service by licenced lawyers.
Submission of documents to the Cyprus Registrar
All the above documents are submitted to the Cyprus Registrar of Companies for approval. On approval the following certificates are issued:
- Directors & secretary
- Registered office
- Articles of Association & Memorandum
The Certificates of the company can be in English or Greek. For the Articles and Memorandum to be in English there is some extra charge.
The approval and registration of the company take 2-4 working days after submission.
Cyprus company formation fees
The government fees required for a Cyprus company formation and registration are the following:
- Company name approval €30
- Stamps for form HE1 €52
- Company registration fees €485
- Articles of Association & Memorandum in English (optional) €240
- Courier Fees €35
- Advice as to the most efficient Cyprus company structure
- Preparation and submission of company documents
- Tax Advice
- Secretarial Services - keep share registers, holding of Annual General Meetings, filing of financial statements
- Fiduciary and Domiciliary Services – provision of directors, nominee shareholders, registered address and substance offices
- Accounting and Payroll Services
- Virtual Office Services
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