<!DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd">
<html xmlns="http://www.w3.org/1999/xhtml">
<meta http-equiv="Content-Type" content="text/html; charset=iso-8859-1" />
<title>K&amp;K LAW</title>
For career opportunities with our firm, please send your C.V. to Mrs. Androula Constantinou, as our firm is constantly interested in recruiting candidates who can fit in with the rest of the team.
Cyprus enacted in 1992 the International Trusts Law (Law No. 69(1)/1992) and as a result Cyprus became a very attractive jurisdiction to non residents for setting up a trust.
As it is provided by Article 2 of the Law, for a trust to qualify as an international trust, the following requirements must be fulfilled:
1. the settlor must not be a permanent resident of Cyprus;
2. at least one of the trustees must be permanently resident in Cyprus. Cyprus companies that are not resident are able to set up international trusts and as a result a non Cypriot settlor may maintain control of the trust by incorporating a Cyprus Company that is controlled by him, which could be appointed as Trustee. 3. no beneficiary, other than a charitable institution, can be a permanent resident of Cyprus;
4. the trust property cannot include any immovable property in Cyprus; CHARACTERISTICS AND ADVANTAGES OF CYPRUS INTERNATIONAL TRUSTS
• Trusts and beneficiaries of trusts are not taxed in Cyprus provided both the settlor and the beneficiaries are nonresident and the trust property is not in Cyprus.
• No formalities are required in order to create a Cyprus International Trust, except where it is created by a will.
• The Settlor has a very wide discretion as to the provisions of the trust, provided that there are certainty of intention, object and subject matter.
• No capital gains tax is paid by international trusts.
• Credit interest on a foreign currency account held at any bank in Cyprus is not taxed and there is no exchange control.
• No estate duty is paid by international trusts.
• In accordance to Article 12(2) of the Law a Cyprus International Trust is subject to stamp duty of CY£250 irrespective of the amount or value of the trust property.
• A Cyprus international trust may be a shareholder in a Cyprus international company and thereby enjoy the tax and other benefits of international companies. Its liability is limited to the original capital paid and confidentiality is ensured by the use of nominees.
• There is no registration or reporting requirements for trusts established in Cyprus and the names of the trustees, and others named in the trust document, are not disclosed.
• The disclosure of information regarding a Cyprus International Trust may be allowed only by a Court Order that is issued only if the information is critical for the outcome of any civil or criminal procedure.
• When this is allowed by the provisions of a trust, the law that governs a trust (either this is Cyprus law or any other law) may be changed provided that:
- in the case where a trust governed by Cyprus Law adopts another law, the new governing law should recognize the validity of the trust and the various rights of the beneficiaries.
- In the case where an existing trust that is governed by any law other than Cyprus Law, such law should allow the change of governing Law.
Withholding Tax Rates paid from the treaty countries listed to residents of Cyprus
(1) 5 per cent on film and TV royalties
(2) Nil on literary, dramatic, musical or artistic work
(3) Nil if paid to a government or for export guarantee
(4) For literary, artistic or scientific work, film, and TV royalties, the relevant non-treaty applies
(5) Nil if paid to the Government of the other state
(6) 10 per cent on literary, artistic or scientific work, film and TV royalties
(7) 10 per cent if received by a company controlling 25 per cent or more of the voting power
(8) 10 per cent on dividends received by individuals which may be refundable in some cases
(9) 10 per cent if received by a company controlling 10 per cent or more of the voting power
(10) Nil if paid to a Government, bank or financial institution
(11) 5 per cent on film royalties
(12) 15 per cent if received by a company controlling less than 10 per cent of the shares
(13) 5 per cent if received by a company controlling 25 per cent or more of the voting power
(14) 5 per cent if received by a company controlling less than 50 per cent of the voting power
(15) Nil if received by a company controlling 10 per cent or more of the voting power
(16) 5 per cent if received by a company controlling 10 per cent or more of the voting power
(17) 15 per cent if received by a company controlling less than 25 per cent of the shares
(18) 5 per cent on patent royalties
(19) 30 per cent on payments to individuals
(20) 25 per cent on excess amount on annual payments over C£100.000
(21) The treaty provides for withholding tax but Greece does not impose any withholding tax in accordance with its own legislation
(22) 10 per cent if the investment in a company is less than US$100.000.
(23) The old treaty with the USSR applies to most of the CIS Republics. (The old USSR treaty applied to Russia until 31 Dec. 1999.)
(24) 5% if the investment exceeds EU200.000. 10% if the investment is lower than EU200.000 and the investor controls over 25% of the shares. 15% in all other cases.
(25) 10% if received by a company controlling less than 25% of the voting power.
(26) Does not apply if paid to a Cyprus International Company of which 25% of the shares are directly or indirectly controlled by a Bulgarian resident.
(27) 10% if paid to a financial institution or on credit sales of industrial, commercial, or scientific goods or equipment
(28) This rate applies to any copyright of literary, dramatic, musical, artistic or scientific work. 10% for use, or right to use, industrial, commercial, or scientific equipment. 15% for use of a patent, trademark, design, or model, plan, secret formula or process.
(29) 7% if paid to a bank or financial institution
On 1st January 2003, Cyprus introduced new tax laws that are especially favourable to holding companies.
The main advantages are:
1.1 Dividend income is wholly exempt from income tax, but see “Participation Exemption” at 1.13.
1.2 Any gains realised on disposal of securities / shares in subsidiaries are not subject to taxation in Cyprus. This applies to all gains including capital gains and gains from trading in securities.
1.3 There is no holding period requirement for dividends or capital gains exemptions.
1.4 Cyprus joined the European Union (EU) on 1st May 2004. As a result, Cyprus holding companies can now receive tax-free dividends from their EU subsidiaries in cases where the Parent – Subsidiary Directive applies, subject to any anti-avoidance provisions in the jurisdiction of the paying company. Interest and Royalties can also be free of withholding taxes through the application of the Interest and Royalties Directives.
1.5 Cyprus has a wide network of double tax treaties providing zero or low withholding tax rates on interest, dividends and royalties.
1.6 There is no withholding tax on dividend, interest and royalties paid to non- resident individuals, and corporations.
1.7 There is no general Controlled Foreign Corporation (CFC) legislation.
1.8 Interest paid to non-resident group companies is tax deductible
1.9 There are no thin capitalisation rules
1.10 Taxes withheld abroad can be credited against Cyprus tax even in cases where there is no double tax treaty between Cyprus and the other country. Also, where tax was withheld on dividends by an EU country the tax credit includes the share of tax paid on the gains of the company paying the dividend and the gains of its subsidiaries.
1.11 Losses
�� Can be offset against other sources of income
�� Can be carried forward indefinitely
�� Losses of a company can be set off against profits of another company of the same Group.
�� World-wide losses can be set off against taxable income of the same year or carried forward
1.12 Reorganisations, Mergers, Acquisitions, Amalgamations
The Law adopted the Merger Directive of the European Union, but took into account emerging EU policies. The Law covers domestic and foreign reorganisations, and reorganisations abroad that have effect in Cyprus; these are exempted from all taxes including Capital Gains Tax, VAT, Stamp Duties, and Land Transfer Fees. From 1st January 2003, Cyprus has the best tax system for reorganisations in the World.
1.13 Participation exemption
Defence contribution, another form of taxation, is imposed as follows:
15% on dividends received. Nil if received from a non-resident company in which the Cyprus company holds at least 1% of the share capital. The exemption will not apply if the paying company derives more than 50% of its income from investments and foreign tax on its income is substantially lower than Cyprus taxes.

Cyprus has traditionally been a major offshore incorporation centre attracting the incorporation of thousands of offshore companies annually, since Cyprus has always provided attractive tax planning possibilities together with its centralized geographical position in the middle of the Mediterranean Sea, enclosed by Europe, Asia and Africa.
Since the 1st of May 2004, Cyprus has entered the European Union and as a result the Cyprus Laws in the last couple of years have gone through a wide range reform so as to bring Cyprus laws in line with E.U. requirements and also within the OECD requirements against harmful tax practices. These reforms, together with a wide network of double taxation treaties establish Cyprus as one of the most favourable tax regimes in the world.
From 1st October 2004, non Cypriots (physical persons or other entities) do not require any permit to hold shares in a Cyprus Company.
The first step to set up a Cyprus Company is to apply to the Registrar of Companies for approval of the company’s name. This takes about 30 working days. By paying an acceleration fee to the registrar of companies this can be reduced to 5 to 6 working days. Please note that we always have a list of already approved names. If you are not concerned about the name you can choose from our list.
Secondly, an application is made to the Registrar of Companies to register the company in accordance with the Cyprus Company Law.
To register a Cyprus Company takes about 30 working days. By paying an acceleration fee to the Registrar of Companies this can be reduced to 5 to 6 working days. You can also use immediately one of the already incorporated companies that our office keeps, at an additional cost.
For registration of the company in accordance with the Cyprus Laws, the following are required:
1 The name of the company. At least three names should be provided in order of preference.
2 The names, addresses and nationalities of the directors, company Secretary and Shareholders, together with copies of their passports (main pages only). Our Form A should be completed by each shareholder, director, company secretary.
3 References for each Shareholder. We require a reference from a bank, or professional accountant, or lawyer or existing client. A specimen reference can be found at page 5 of Form A.
4 The number of shares held by each Shareholder.
5 The amount of Authorised and Issued Share Capital.
6 The company's main activity. Our standard text for a trading company has clauses covering almost all classes of activity.
The following information should be useful:
1. The minimum number of directors is one (who cannot however be the Secretary unless specifically stated in the Articles of Association of the Company).
2. The Secretary does not have to be Cypriot.
3. One of the officers of the Company (Director or Secretary or Assistant Secretary) should reside in Cyprus.
4. The Registered Office must be in Cyprus - our address may be used.
5. Local auditors must be appointed.
6. There is no minimum number of shareholders for a private company.
7. Nominee Shareholders can be appointed. By the use of nominees complete confidentiality is ensured.
8. On incorporation you will receive:
a. Certified Memorandum & Articles of Association in the Greek language together with an English copy as translated by us.
b. Certificates of incorporation, of the shareholders, directors & secretary and registered office, all in Greek or English.
c. Share certificates in Greek or English.
d. A company stamp.
e. Trust Deeds (when appropriate).
A complete list of our fees and charges for the formation of Cyprus Companies can be supplied upon request.

Koushos & Korfiotis Advocates and Legal Consultants was established in 1977, by two young and prominent lawyers, Kyriacos J. Koushos and George Th. Korfiotis. The firm has grown steadily to one of the leading law firms in Cyprus providing legal services in almost all areas of law putting in full use the expertise and experience of our team which consists of lawyers and other support staff.
As the firm is comprised of efficient and reliable lawyers of different educational backgrounds, we are capable of dealing with cases of all areas, as well as having our own specialized fields, in the aim of providing our clients with the best and most coherent legal advice and services.

KOUSHOS & KORFIOTIS Advocates and Legal Consultants is engaged in a number of practice areas, some of the main ones are listed here with below:
• Administrative Law
• Alternative Dispute Resolution
• Banking and Financial Services Law
• Competition Law
• Corporate, Commercial and Tax Law
• Corporate Finance Law
• Employment Law
• Family Law
• Insurance
• International Contracts
• Litigation
• Medical Negligence
• Real Estate Law
Due to the long established experience of the lawyers of our firm and their legal expertise, each in their respective specialized fields, our firm is in the privileged position to provide our clients with outstanding zeal and most coherent legal advice in almost all areas of law.
A non-exhaustive list of the major practice areas of our firm includes the following:
Administrative Law
KOUSHOS & KORFIOTIS Advocates and Legal Consultants provide legal advice and consultation regarding Administrative Law issues, and any legal representation to relevant litigation. Examples of administrative law issues dealt by our office include matters involving tender offers, administrative penalties and issues concerning the Cyprus Stock Exchange and the Cyprus Securities Committee. Our firm has also been chosen by the relevant authorities for providing professional services for the drafting of legislation and regulations relating to the harmonisation of Cyprus Cooperatives Laws with the European directives as well as the legislation and regulations relating to the Cyprus Stock Exchange.
Alternative Dispute Resolution
Koushos & Korfiotis Advocates & Legal Consultants is active in the area of arbitration and other alternative dispute resolution measures. Members of our team have been appointed as arbitrators for many kinds of disputes, or represented our clients before arbitration proceedings or offered legal advice and court representation to arbitrators. The firm has also undertaken the registration in Cyprus Courts of arbitral awards and the filing of appeals against arbitrary decisions. Our firm has also considerable experience in international and local mediation.
Banking and Financial Services Law
By being one of the first law firms in Cyprus to be involved in the area of Financial Services Law in Cyprus, we provide legal services to a number of Banks, Financial Institutions and Financial Services Companies.
Competition Law
The firm has provided our clients with legal advice and representation before the Commission for the Protection of Competition and the Supreme Court of Cyprus, regarding all aspects of competition law.
Corporate, Commercial and Tax Law
KOUSHOS & KORFIOTIS Advocates and Legal Consultants is very active in counselling Cypriot and foreign clients in matters relating to Corporate, Commercial and Tax Law. Our clients are provided with comprehensive legal services in the area of
Corporate and Commercial Law including contract drafting and negotiations, Tax advice and structures, formation and administration of Cyprus and other jurisdiction companies, establishment of trusts, formation of joint ventures structures and joint venture agreements, negotiation and drafting of shareholders’ agreements, and more. Being an important area of practice of our firm, the practice further extends to takeovers and acquisitions, buy-outs, mergers, group formation and group restructuring involving complex and usually multinational negotiations. KOUSHOS & KORFIOTIS Advocates and Legal Consultants further extend their services to their clients through the registration of patents both with the Cyprus and the European registries and the registration of companies, partnerships and business names with the relevant registries.
Corporate Finance Law
KOUSHOS & KORFIOTIS Advocates and Legal Consultants is one of the leading Cypriot law firms engaged in the provision of Corporate Finance services, including legal services in the floatation of companies and their listing in the Cyprus Stock Exchange.
Employment Law
KOUSHOS & KORFIOTIS Advocates and Legal Consultants assist its clients with all aspects of Employment Law from the drafting of employment contracts, management of human resources departments, termination of employment agreements, to negotiation and legal representation before the Courts.
Family Law
The team of our firm is involved in the legal advice and representation of its clients through the different family law procedures, including divorce applications to both religious and lay courts, alimony proceedings, property disputes and adoption proceedings, involving negotiations and court representations in all levels.
Insurance Law
Our firm is involved in the whole spectrum of Insurance law including legal advice, negotiation and review of insurance policies, claims and representation before the Court of insurance companies, insured persons and entities, or of other persons and entities that claim any kind of remedy against insured persons and entities.
International Contracts
Our firm provides services to our international and local clients in the field of cross-border transactions of various kinds including the drafting or reviewing or negotiation of agreements and other documentation and the provision of legal advice with respect to tax, securities, corporate issues, due diligence, trading, provision of services, licensing, joint ventures, agency, distributorship, and all related matters.
The team of KOUSHOS & KORFIOTIS Advocates & Legal Consultants ensures the legal representation of our clients in court, regarding all areas of dispute. The court representation offered to our clients is at all levels, with respect to disputes based on a variety of origins including contractual grievances, purchase and sale contracts, company law disputes, service agreements, financing, inheritance law, partnerships, accidents, insurance, medical negligence, employment contracts, registration of arbitral decisions, etc. Our firm further provides legal representation in Alternative Dispute Resolution (ADR) measures including arbitration.
Medical Negligence Law
Koushos and Korfiotis Advocates & Legal Consultants is one of the leading law firms in the area of Medical Negligence Law being involved in a number of cases representing hospitals, doctors or persons claiming compensation for medical negligence.
Real Estate Law
KOUSHOS & KORFIOTIS Advocates and Legal Consultants provides its clients with advice and support on all aspects related with the legal framework of Real Estate Law. This involves amongst others drafting and negotiation of purchase and sales contracts, lease agreements, filing of applications by foreign nationals for permission to acquire property in Cyprus.