Moving a Company to an EU Member State: How Redomiciliation to Cyprus Works

A foreign company, including one from outside the EU, can become a Cyprus company without being wound up. The mechanism is redomiciliation, known in company law as continuation. The registered office moves to Cyprus, an EU member state, and the company keeps its corporate identity and its business continuity. That is why owners consider it instead of closing one entity and incorporating another. Only the law governing the company changes.

Cyprus allows continuation in both directions, for private and public companies, under the Companies Law, Cap 113, as amended in 2006. The procedure is a sequence of approvals handled by two registries, and each step has a deadline attached. The order of the steps and the length of those deadlines shape the timetable more than the number of documents does.

Coming into Cyprus: conditions first, then a six month window

A foreign company can move to Cyprus only if its own constitution and its home law allow it, and only with the prior consent of its home authorities. That consent is a precondition, so it has to be obtained before anything is filed in Cyprus. The company’s name must end in “limited”, and a name approval in Cyprus lasts six months. A company carrying on licensed activity must show evidence of its foreign licence and obtain a Cyprus licence before it starts regulated business there. Bearer shares are not recognised, so share capital must be in registered form.

The paperwork is largely corporate. The shareholders adopt a new Memorandum and Articles by special resolution, which needs 75 percent approval at a general meeting called on 21 days’ notice. The file also includes an apostilled board or shareholder resolution, an apostilled good standing certificate, lists of directors and shareholders, a legal opinion or authority confirmation from the home jurisdiction, and evidence that no employee or creditor objects. Sworn affidavits on the company’s status and solvency complete it. A false solvency declaration carries criminal liability: up to one year in prison and a fine of up to €34,172. A Cyprus lawyer or a resident director must act as authorised representative and file forms MEA and ME1.

Once the Registrar is satisfied, it issues a Temporary Certificate of Continuation, and the company is treated as Cyprus incorporated from that date. A second deadline then starts running. The company has six months to file form ME4 with a de-registration certificate from its original registry, and the home registration must not be cancelled until the temporary certificate exists. The Registrar can add three months for reasonable cause. After that, it may delete the company’s name and notify the foreign authorities. The Final Certificate of Continuation follows the ME4 filing.

Leaving Cyprus: solvency, publication and a three month wait

A company leaving Cyprus starts from Cyprus compliance. Its Memorandum and Articles must allow the transfer, the destination law must permit it, and the proposed name there must be confirmed. All annual returns must be filed and every fee, levy and sum due paid. Any Cyprus licence needs consent from the relevant authority, including the Cyprus Securities and Exchange Commission where it applies. No court case or liquidation may be pending, and employees must be informed and paid any compensation due.

The central document is the solvency statement on form ME3, signed by at least two directors, or by the sole director, covering the next three years. It travels with a special resolution approving interim financial statements, certified accounts approved by shareholders and auditors, form ME2 with a board resolution, and tax, VAT and social insurance clearance certificates. The special resolution must then be published in two daily newspapers, and a copy sent to the Registrar within 14 days.

Publication starts the longest wait in the process. The Registrar will not consent until three months have passed from publication, which gives creditors and others time to object. When the conditions are met, the Registrar issues a certificate of consent, the destination authority issues its Certificate of Continuation, and the company delivers that certificate to the Registrar with a certified translation. The Registrar then strikes the company off, issues a Strike Off Certificate and publishes the notice in the Cyprus Government Gazette. The certificate goes on to the destination authority.

Read side by side, the two directions mirror each other. Inbound, the slow part is the front end: home consents, apostilled documents and name approval have to be in order before the Registrar acts, and a six month window then runs for the home registry to release the company. Outbound, the front end is Cyprus compliance and a solvency statement that looks three years ahead, followed by a fixed three month wait after publication. In both directions the steps that depend on another authority, such as home consents, newspaper publication or licence approvals, set the pace, so they are the ones to start first. Mavronichis & Co LLC has published an overview of redomiciliation to and from Cyprus, which is useful reading on the documents and steps for each direction.