It is universally acknowledged that internet has an increasing and enormous potential in the development of online business marketplace and electronic commerce. More and more businesses are integrated into the online arena, day by day.

Undeniably, when it comes to online business it is of crucial importance to ensure that your online business is aligned and duly, in compliance, with the relevant regulatory and legislative frameworks. A number of laws have been enacted, that pertain specifically and/or related to the online businesses, including but not limited to intellectual property rights (trademarks, copyrights etc.), privacy policies, terms of service, data protection and consumer rights.

First of all, you have to ensure the registration of your incorporation.

Chambersfield Economides Kranos offers full corporate services in order to cover every possible corporate need, and, can provide you inter-alia, with any legal assistance and/or services required and/or undertake on and/or for your behalf all the necessary procedures, for the purposes of ensuring the registration and formation of your company.

The application for registration of a Cypriot company is filed to and examined by the Companies Registrar and Official Receiver, on a case by case basis.

Also, noted shall be that depending on the services and/or products you wish to provide, you may require to apply for specific license.

Furthermore, when choosing internet as a means for establishing and/or starting your business activities, you must also be properly aware of the issues surrounding intellectual property rights.

Online businesses that embrace modern innovation and invest in research and development, in a cyberspace with a continuous information flow shall, undoubtedly, be Intellectual Property informed and aware.

Intellectual property, comprises, inter alia, industry and industrial property that includes inventions, patents, trademarks, industrial designs and intellectual property rights, creators’ copyright rights, including scientific, musical, literary and artistic works as well as television shows, software, databases, architectural plans, advertising and multimedia, as well as business strategies which include business secrets, confidentiality agreements and know-how.

An important number of consumers avoids electronic commerce, fearing the insufficient data, security and confidentiality.

A strong emphasize shall be placed on consumer protection standards and legislative requirements. When you operate your business online, you have to ensure that your website is properly compliant with the relevant legislative and/or regulatory requirements, considering privacy policies.

Among others there is an outmost need of implementing privacy policies. Privacy policies are used to let customers know how their personally identifiable information is going to be used by the online business.

In addition, personal data protection is deemed to be of outmost importance and one of the main concerns for consumers and businesses.

If you use and/or process the personal data of EU citizens or residents, then the GDPR (General Data Protection Regulation) may apply to you even if you’re not in the EU, imposing high privacy and security standards. Consequently, you have to make sure that you have the appropriate terms and conditions and disclaimers in place.

Moreover, ensuring and implementing cyber security policies is of vital importance for your business, safeguarding sensitive data, personally identifiable information and protecting it from cyber threats.

For online businesses to thrive there is a need of compliance with the relevant legislative and/or regulatory framework, encouraging businesses’ economic growth and success.

Complying with the relevant regulatory and legislative framework will enhance, inter alia, your relationship with your prospective and existing customers and help you building your reputation as an ethical and trustworthy business.

Be fully prepared in properly complying with all the legal requirements and/or formalities, will minimize possible risks to your business and/or prevent any unwanted legal complications.

Our legal team of expert and experienced professionals can advise you and assist you with all legal aspects related to formation and/or operation of online businesses, as well as consultation and representation in relevant litigation proceedings.

For further information and/or clarifications you may require, please contact our offices.

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Majority of trading retail shops, malls, shopping centers, restaurants, cafes and other type of businesses are turning into online e-commerce in order to minimize and mitigate against the losses due to the lock-downs from the Pandemic.

It is crucial that any business should take the steps towards online sales (e-commerce) in order to continue their operations. In addition, e-commerce of course can play a critical role in actually even expanding a business. By going digital and online, a business can approach a bigger market share than the traditional retail store operation.

The transition to e-commerce must be done in a correct and educated manner, taking all the precautions and all legal measures to support that change of operations.

There are numerous procedures and documents that needs to be prepared in order to be able to legally and safely initiate online sales. Starting form basic terms and conditions, privacy policy, cookies policy, GDPR compliance, refund and returns rights, intellectual property, copyright and trademark issues are some of the few issues that a business should consult and act upon before they launch their online business.

The correct and professional set up of the above will increase your operational capabilities and minimize exposure in severe risks in the future. Our law firm has an expert team for specifically online – digital – eCommerce businesses and can assist you in a prompt, professional and efficient manner.

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An Article by Michalis Economides, Advocate & Legal Consultant | CEO of Chambersfield Economides Kranos Law firm

Article Publication: Capital Today Magazine July 2018.

The last decade formed a new reality in the Intellectual Property sector, which made its registration essential to any business.

The cyberspace with its continuous information flow, as well as the expansion of most businesses abroad, have already established the new, modern, framework for the intellectual property.

Intellectual Property is defined as the competitive advantage of a private or legal entity and is categorized as follows:

• Industry and Industrial Property that includes inventions – patents, trademarks, industrial designs and intellectual property rights.
• Creators’ Copyright rights. This category includes scientific, musical, literary and artistic works as well as television shows, software, databases, architectural plans, advertising and multimedia.
• Business strategies which include business secrets, confidentiality agreements and know-how.

As a business investment center and member of the European Union, Cyprus provides protection under the Community law while being harmonized with all the standards and requirements of the World Intellectual Property Organization (WIPO) and the European Union Intellectual Property Office (EUIPO). Additionally, the Republic of Cyprus has numerous Community and international conventions and related sanctioning laws, including the Bern Convention on the Protection of Literary and Artistic Works, the Madrid Agreement and Protocol on the Registration of Trademarks at International Level, the Paris Convention on the Protection of Industrial Property etc., and has rightfully earned its position on the world map as one of the most favorable jurisdictions for company formation and intellectual property management.

The competitive advantage gained by the intellectual property protection is of major economic importance for today’s businesses because it can provide instant awareness and / or differentiation in the company’s products and services, while adding value to its reputation. This is exactly why reputation is considered to be a fixed asset of a business.

Another competitive advantage, for reducing the taxation on intangible assets such as intellectual property, is the company’s formation in jurisdictions with a favorable tax regime. Republic of Cyprus is definitely a privileged jurisdiction due to the various double taxation treaties which maintains its favorable tax status with other countries, as well as the low to zero tax retention of dividends.

It is vital to understand the differentiation of the trademark, the business trade name and their significance.

The trademark guarantees the name and / or logo and / or both, while the business trade name basically protects only the name, without fully guaranteeing the owner’s copyright. The trademark is what effectively protects the name of the product or service, the logo, or the combination of both.
Additionally, the company name is not copyrighted if the company does not make the appropriate procedures provided by the legal framework for its registration as a trademark.

Subsequently, in order to be protected by the registration of the company name, it should be registered as a trademark, as defined by the Trademark Law (Chapter 268), combined with the provisions, principles and guidelines deriving from the International Convention of Paris for the Protection of Industrial Property (Laws 63/65 and 66/83).

As a law firm that operates internationally in more than twenty one jurisdictions by providing corporate services, we advise our customers, especially those operating abroad, to register their trademark so that they can prevent any use and / or exploitation, by third parties. Specifically, this process is of upmost importance when it comes to companies investing remarkable funds in branding the services and products they provide.

Besides, the trademark is the one characteristic that differentiates and highlights the innovative ideas and activities of the businesses. For that reason, huge branding, preservation and development budgets are being invested for the product or service concerned, always aiming at the establishment of reputation, which is inseparably interrelated with the profitability of the company.

Furthermore, our highly competitive business environment, having as its main feature the widespread and immediate dissemination of information, indicates the significance of branding, making it a matter of major importance.

In the Republic of Cyprus, the Intellectual and Industrial Property sector of the Department of Company Registrar and Official Receiver, is the one who manages and regulates Intellectual Property issues. This sector includes trademarks, patents, industrial designs, record keeping and intellectual property rights.

In conclusion, the registration of Intellectual Property should not be overlooked; on the contrary, it is an investment and at the same time, an intangible asset, which adds value to the products and / or services of each business. Moreover, it is important that an intellectual property owner monitors and protects his intellectual property rights in a wider range, especially when they operate in other countries, where appropriate actions should be taken to register and protect such intellectual property rights to all required entities.

Based on our experience and due to the fact that not all cases are simple, we recommend that all intellectual property procedures must be supervised by experienced and accredited law firms, which can provide the necessary and appropriate advice throughout the procedure, both at national and international level.

The post Intellectual Property | IP appeared first on Chambersfield Economides Kranos.

In the last few years the term “StartUps” has become quite popular, despite the fact that this business model first appeared in 1950s.

“StartUps or Young Entrepreneurships” are newly established enterprises which offer innovative ideas, aim at extremely fast business development and reach a wide audience.

Their main goal is to create a model that can evolve and repeat itself.

Due to the above-mentioned characteristics, a large percentage of these companies originate from the field of technology aiming at the dynamic development of an existing idea or the creation of an innovation that will satisfy a new need.

Based on our experience, the past has repeatedly demonstrated that there is no “secret recipe for success”. Each case is different and unique, it accepts either positive or negative influences from the various changes and fluctuations that occur in the domestic and international market, as they result from the political, economic, social, technological, environmental and legal framework.

Due to the complexity of the aforementioned factors as they arise from the markets, especially from the legal perspective, it is important for StartUps companies, from the conception of the idea until its realization, to cooperate with a law firm specializing in company and business law. Embracing this approach, you directly ensure the protection of the newly established company, the implementation of the correct procedures and due diligence on the points of cooperation. It also prevents uncertainties on terms and conditions, while providing legal and business advices at every stage of the business development.

Although each case is unique, we have noticed that there are common legal questions about the establishment of the StartUp corporate entity, such as:

• Which is the most appropriate type of forming a corporate entity for a “StartUp” company?

The most popular corporate entity of a “StartUp” type is the Limited Liability Company (LTD). This is because the company is a separate legal entity and the responsibility of the owners and shareholders is limited to their share of the investment capital, without any extension to their personal assets, unless of course the case is of a criminal nature.

• Where will the headquarters of the new entity’s StartUp be?

Because of the European Union as well as globalization, a “StartUp” company can choose its headquarters among multiple jurisdictions. Cyprus is one of the most popular jurisdictions for the incorporation of a company since it has a straightforward taxation system and a 12.5% corporate tax, one of the lowest in Europe. In addition, among others reasons, Cyprus has more than 60 double taxation treaties established with other countries, is a Member State of the European Union, operates in a favorable tax regime, has a low to zero retention of dividend taxes, any financial losses of a company may be transferred against future profits for an indefinite period, while the company registration is quick and immediate.
Additionally, Cyprus’s investment strategy is strongly supported by the government and is constantly creating new business opportunities.

• How long does it take to establish a new legal entity in Cyprus?

7 – 9 days

• What is the appropriate structure / organization chart of the new legal entity “StartUp”?

The appropriate structure / organization chart of the new legal entity depends on a case-by-case basis; however, it is explained in a descriptive way in the Memorandum and Article of Association, defining the relations of the contracting parties.

• What should be mentioned in the Memorandum and Article of Association of the new legal entity?

The Memorandum and Article of Association mentions, all general terms as well as specific, all the conditions that ensure and regulate the relations of all the Contracting Parties involved, as they result from the legislative framework of the jurisdiction in which the new legal entity will operate.

• How will the ownership of partners and / or shareholders and employees be divided in the new legal entity?

The drafting of a shareholders’ agreement defines, inter alia, their obligations and rights, their meetings, the decision-making process to be followed, the terms and conditions of a voluntary resolution and the provision of the necessary mechanisms for the immediate settlement of disputes between the parties.

• What contracts are needed to ensure the stable and continuous development of the new legal entity?

It is wise to have shareholders and employee contracts that will define and clarify the relationship of all the parties involved.

• Is the drafting of a Privacy and Confidentiality Agreement needed?

Because of the innovative nature of “StartUps”, it is advised to draft a Privacy and Confidentiality Agreement when two or more members exist, to preserve the idea until the new entity has its proprietary intellectual property in its possession.

• Do the “StartUps” need to register their intellectual property?

The main competitive advantage and the most important predictor of StartUps’ success is innovation. Therefore, safeguarding and protecting intellectual property is of major economic importance for the enterprises of this type.

My legal and business advice for StartUps, is to work with a law firm specialized in corporate, commercial and employment law, prior to the start of the company, which will also have the necessary knowledge and connections at an international level. This cooperation will ensure the protection of the new corporate entity while the company is in line with all procedures resulting from the legislative framework.

In addition, such cooperation is a necessary pillar for setting the right foundations of the enterprise, which can later evolve into an international “StartUp”. Unfortunately, we have repeatedly observed that the founders of companies turn to legal advisors at a later stage and they are called upon to solve various problems that could be avoided with the proper cooperation of reliable lawyers who are familiar with this company model.

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or for more complicated matters such as accident claims, medical negligence, property disputes, personal disputes and so on. Legal issues are a part of everyday life and it is very important to learn how to deal with them efficiently with the help of smart planning and the assistance of the right legal consultants. Based on my experience, the following are the most common legal issues on which advocates in Cyprus are being asked for advice.

1. Formation of a New Legal Entity (Company Incorporation)

During the initial stage of setting up a business, it is highly recommended that new Legal Entities obtain legal consultation from an accredited law firm with experience of business and tax law issues. What happens in the initial stage will follow the operational life cycle of the company’s business development and corporate obligations.

Therefore, with the assistance of legal consultants:

• The right type of company will be selected and formulated in a favorable jurisdiction, taking into consideration the tax laws and business operations of the chosen jurisdiction.
• The Memorandum and Articles of Association will clearly outline all the general terms of the new entity and will specifically address the conditions regulating the relationship between the involved contracting parties.
• A possible shareholders’ agreement will document shareholders’ relationships by specifying the responsibilities and rights, meetings, the decision-making process, terms and conditions of a voluntary resolution, shareholders’ capital issuance and transfer as well as the necessary mechanism for common disputes that may arise during the company’s operations.
• The employment contract will define and clarify the parties’ relationships and duties.
• A confidentially agreement will secure the preservation of the new development ideas and concepts of the new entity. Business owners will protect their newly established company via this methodology and by implementing the right procedures and strategies to deal successfully with common uncertainties and misunderstandings that may arise during the firm’s business development and operations.

2. Intellectual Property

Fearless competition, cross-border transactions, constant availability of information and development of businesses abroad have established a new reality and prerequisite regarding the protection of intellectual property rights. The registration of Intellectual Property such as trademarks is a business investment that should not be neglected since it adds value to the services / products of a business and provides instant recognition and differentiation from the competition. Subsequently, the registration of Intellectual Property rights is highly recommended and the process must be supervised by a law firm with experience in this matter, in order for the proper guidelines to be implemented on both a national and international level.

3. Employment Law

The relationship between employer and employees should always be well-defined and secured through an employment contract, since a dispute between the parties may turn into a major legal liability. With an employment contract in place, the business code of conduct is specified, the parties know their rights, responsibilities, tasks and evaluation methods. With the relationship properly established, all the parties know exactly where they stand.

4. Real Estate – Property Sales and Purchase Contracts

The sales purchase contract is the most important document in any transaction, since it outlines all the rights and appropriate actions to be taken, should a dispute arise, and documents all the possible risks that may lead to a disagreement. A real estate property acquisition requires significant investment.

Consequently, it is essential that the drafting of the contract agreement to be undertaken only by legal advisors, who are responsible for safeguarding the interests of all the parties involved and ensuring that the terms and conditions are fully compliant with the provisions of the legal framework that governs the jurisdiction in which the transaction takes place.

Furthermore, a law firm can act as a mediator and provide escrow services until the completion of the business transaction, meaning that the law firm will be responsible for overseeing the transaction progress and only when all due diligence has been performed and the terms and conditions are satisfied, then, upon the instructions of the client, will it proceed with the release of the funds and complete the transaction.

5. Commercial Contracts

We all deal with commercial contracts, either oral or written, as part of our daily routine. As mentioned above, a contract is a legally binding agreement that should always exist when two or more parties are forming a business relationship of any kind, no matter the size of the entity or the value of the deal. It is advisable to spend some time with your legal advisors and draw up a proper contract, to limit any future disputes and drawbacks that will affect your future business operations. A properly drafted contract agreement should clearly state the obligations and rights of the relationship between two or more parties, as well as define the nature of the relationship, its duration, the tasks of the parties, confidentiality and other important aspects.

6. Tenancy Issues

The laws governing the relationship between a tenant and landlord have recently been amended in Cyprus, in order to change what comprised a series of time- consuming legal processes that a landlord needed to go through in order to evict tenants who violated their agreed responsibilities and to recover outstanding rent. But it has always been essential to have a well-structured lease agreement, which clearly addresses all possible future scenarios that may lead to a dispute, states the responsibilities and rights of each party, as well as the timeframe of the agreement. I would like to emphasize on the importance of tenancy agreements between private owners and legal entities.

In my opinion, the appointment of an expert legal consultant should be required in order for property owners to avoid the unfortunate consequences of the discontinuation of business operations on the part of the legal entity or lack of financial collateral.

7. Loan Restructuring

Loans, mortgages and debts can frustrate and fill people with anxiety. Trusted lawyers / certified liquidators and insolvency practitioners will examine whether legal entities and/or physical persons have the ability to repay and may provide several consultative restructuring plans that aim to activate the appropriate debt dealing mechanisms, i.e. through restructuring or by lengthening the repayment period of the amount or exchanging the debt for a real estate asset, etc.

8. Divorce

The dissolution of a marriage is, of itself, a very stressful process and becomes even more stressful for the parties when children are involved. It is, therefore, essential to have a trusted lawyer who will help in all the required procedures, including the maintenance of children and spouse, custody issues, the division of family assets, etc.

9. Accident Claims

Being involved in a motor accident, even a minor one, is not always as straightforward as it initially seems, and disputes may arise between the involved parties. Therefore, legal representation is a necessity to avoid possible discrepancies and ensure that, where relevant, you receive the greatest possible compensation. Besides calling for medical assistance for any injuries, you must contact the police, your insurance company and your lawyer, so as to properly protect your legal rights. Moreover, it is of equally great importance that you take your own photos, not move your vehicle until the police and the insurance company are on the scene and note the full contact details of any witnesses to the accident.

10. Medical Negligence

In recent years, there has been an increase in the number of cases of alleged malpractice and/or liability (cases of medical negligence). People are more aware than ever of their right to question the quality and the result treatment that they or a family member have received and to act accordingly. For an incident to be characterized as medical negligence, certain conditions must be met. According to the relevant regulatory and legislative framework, in civil cases, the components of a three- part test should be established and proven on the balance of probabilities, whereas, in criminal cases, considering medical negligence-related convictions, the standard of evidence that needs to be met is “beyond any reasonable doubt”. Medical malpractice incidents are rarely deemed to be black and white cases, since they may be based on subjective and contradictory opinions, different types of medical practices and techniques, lack of diagnosis, medical misdiagnosis, surgical error, anesthesia error, unforeseen events and many other factors. Therefore, it is prudent, when such incidents occur, to seek the assistance and consultation of a law firm experienced in instances of medical negligence, in order to fully discuss the case and possible action. In general, whether an individual or a business, it is wise to seek legal advice on matters that involve relationships with third parties, so as to safeguard your rights. An experienced law firm has the knowledge and know-how to proactively delineate the status of relationships and assist in the prevention of disputes.

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