A new strategy aiming to attract foreign businesses to establish and expand their activities in Cyprus through a plan, was presented by the Cypriot Government and will be implemented from January 1, 2022.

The plan targets areas or fields interrelated to, inter alia, High Technology Companies, Innovation Companies, Shipping Companies, Pharmaceutical Companies, Biogenetics and Biotechnology Companies.

This plan aims to make Cyprus a Sustainable Business and Trade Center of the wider area and Europe that will be fully in line with the guidelines of the European Commission and the Recovery and Resilience Facility.

In this context, several incentives were prepared in order to attract foreign Companies to operate and/or relocate their headquarters and/or expand their business activities in Cyprus, which can be summarized as follows:

1. Business Facilitation Unit

A Business Facilitation Unit will be established which will act as the central point of contact for all Companies of international interest, which operate in Cyprus and/or relocate their headquarters and/or expand their business activities in Cyprus in specific areas of economy activity.

1. Company creation (Company registration, name approval, registration in the Social Insurance register, Registration in the VAT register and in the Income Tax)
2. Guidance for relevant permits for activation in Cyprus

• Acceleration in the issuance and renewal of residence and employment permits

2. Revised Policy for the issuance of Temporary Residence and Employment Permits to third country nationals employed in Companies of foreign interests operating in Cyprus

The Government of Cyprus has revised the existing policy for the employment of staff from third-countries who is employed by Companies of foreign interests operating in the Republic of Cyprus and/or Companies of foreign interest which intend to operate and/or relocate their headquarters in Cyprus and/or expand their business activities in Cyprus and have a physical presence in Cyprus including establishment/ operation of independent offices that are separate from any private residence.

Furthermore, the issuance of employment permits is facilitated, and work permits will be issued immediately within 1 month from the submission of the application and will last up to 3 years.

The eligible Companies are the following:

• Cypriot shipping Companies.
• Cypriot high technology / innovation Companies.
• Cypriot pharmaceutical Companies or Companies operating in the fields of biogenetics and biotechnology.

The necessary preconditions for the third country nationals to be employed in Cyprus are the following:

2. Minimum gross monthly salary of €2.500,00.
3. Possession of a university diploma or degree or equivalent qualification or certificate of relevant experience in a corresponding employment position of a 2-year duration and that the employee in question is presented with an employment contract of not less than two years.

The maximum number of third-country nationals that can be employed is set at 70% of the total number of employees of the Company over a period of 5 years.

The Company is also allowed to employ third-country nationals as support staff provided that it does not exceed 30% of the overall support staff. The aforementioned applies if there is a duly validated employment contract between the third country national and the employer in question which is in accordance with current legislation.

In addition, there is the right of family reunification of third country nationals who are part of the Business Facilitation Unit. Through this very Mechanism, the Labor Market will be directly and freely accessible to the Spouses of Employees who have Residency and Work Permits in the Republic. Said access will be limited however, to the Spouses who receive a minimum monthly salary of €2500, while, it does not apply at all to the family of the support staff.

3. Digital Nomad Visa

It should be noted that the Action Plan introduced the initiative of the “Digital Nomad Visa” according to which, Visas are granted to an initial maximum limit of 100 beneficiaries.

The Digital Nomad Visa concerns only residency permits in the Republic of Cyprus and not work permits, for people who live in Cyprus but work in Companies operating abroad.

Beneficiaries of the “Digital Nomad Visa” scheme, will be third-country nationals who are self-employed and/or are employees who work remotely using information and communication technology in order to communicate with their employers and/or clients. Said employers and/or clients must not be residents of the Republic.  The Visa is valid for a period of 12 months, with the right of renewal for another 2 years once said 12-month period has lapsed.

The holders of Digital Nomad Visa can be accompanied by their family members, who are granted, upon their request, a residence permit that expires at the same time as the beneficiaries’ does, but are not granted a work permit.

Moreover, if they have been residents of the Republic of Cyprus for a period of time which in total exceeds 183 days within the same tax year, then they are considered tax residents of Cyprus meaning they are not tax residents in any other Country.

They also have to present evidence which clearly indicate that they have sufficient resources, at a fixed income level, to cover their living expenses during their stay in Cyprus. The amount of resources required is set at €3.500.00 per month, together with medical coverage and a clear criminal record from the country of residence.

4. Tax Incentives

The possibility of extending the 50% tax exemption for investment in certified innovative Companies and by corporate investors is being considered. The regime that was in force until the end of June 2021 allowed tax exemptions only to natural persons. For this purpose, the opinion of the Directorate-General for Competition of the European Commission is expected and subsequently, the approval of the relevant bill is also expected by the Parliament.

In addition, the plan provides for the following:

• The extension of the tax exemption that applies to employees in the Republic, provided that they were non-residents of the Republic before starting their employment, for a period of 17 years.

• The expansion of the existing tax exemption to cover new residents-employees with a salary from employment of €55,000 and above with a tax exemption of 50%.

• Existing employees have the opportunity to extend the benefit from 10 to 17 years. Potential beneficiaries are persons with income (€55,000- € 100,000) for the remaining period of 17 years.

• At the same time, the abolition of the existing tax provision of 20% exemption from employment exercised in the Republic or €8,550 – whichever is lower – will be promoted, since incomes over €55,000 will receive a 50% income tax exemption.

• An increased deduction will also be granted for research and development costs and a deduction of taxable income equal to 120% of the actual cost.

These tax incentives also apply to Cypriots who have lived abroad for at least ten years, in order to persuade them to repatriate back to the Republic.

5. Naturalization

Furthermore, the right to apply for naturalization will be given to the employees of these Companies after five years of residence and work in the Republic or after four years if they meet the criterion of holding a recognized certificate of very good knowledge of the Greek language.

6. Social Insurance

Additionally, the transfer of social security contributions will be ensured so that when third-country nationals who have paid social security contributions in Cyprus, wish to return for permanent residence in their country, they will be entitled to transfer the contributions they paid, provided that they did not acquire any right in regards to age pension and/or disability etc.

The content of this article is valid as at the date of its first publication. It is intended to provide a general guide to the subject-matter and does not constitute legal advice. We recommend that you seek professional advice on your specific matter before acting on any information provided. For further information or advice, please contact Mrs. Stephanie Nicolaou, Advocate, Mediator, Legal Consultant & Certified AML Compliance Officer (CySEC) at the Law Firm CHAMBERSFIELD ECONOMIDES KRANOS, in Limassol Cyprus, # +357 25 356 800 or email at s.nicolaou@eklawyers.com, info@eklawyers.com.

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1. the definition of tax and the residency for companies incorporated in Cyprus,
2. the introduction of withholding taxes on payments of royalties, dividends, and interest to a company tax resident in a country included on the EU blacklist or to a company incorporate dinany of the EU back listed countries which is not considered tax resident anywhere.

Both laws are coming into force on December 31^st, 2022.

Until today, a company was considered as tax resident of Cyprus if its management and control is exercised in Cyprus. After this amendment, any company incorporated or registered in Cyprus whose management and control is exercised outside Cyprus will still be considered as tax resident of Cyprus, unless this company is considered as tax resident in any other state. As a result, a Cyprus-incorporated company can no longer be considered not to be tax resident anywhere. Unless a company is tax resident in a country included in the EU black list or if the company is incorporated in a country not included on the list, it is not tax resident in any jurisdiction

Royalties

The 10% withholding tax will apply to royalty payments made to a company that does not have a residence in Cyprus but which has a residence in a country that is included in the EU blacklist of non-cooperative jurisdictions, or to a company incorporated in such a backlisted country which is not tax resident anywhere, regardless of whether the assets for which the royalty is paid will be used in Cyprus or elsewhere.

Dividends

Dividends paid by Cypriot tax resident companies to companies tax resident in countries included in the EU black list of non-cooperative jurisdictions or to companies incorporated in such countries which are not tax residents anywhere will be subject to a 17% special defense contribution (“SDC”).

The above does not apply to companies listed on a recognized stock exchange.

Interests

The SDC rate on interest paid to a company that is not tax resident of Cyprus but tax resident in a country that is listed on the EU blacklist of non-cooperative jurisdictions, or to a company incorporated in one of those countries that is not considered tax resident anywhere, will be 30%.

The above does not apply to interest paid on securities listed on a recognized stock exchange.

Black listed countries

The list is adopted by EU on the 5^th of October 2021 and consists of the below countries

American Samoa, Fiji, Guam, Palau, Panama, Samoa, Trinidad and Tobago, US Virgin Islands and Vanuatu.

The post Cyprus: Amendments on Income Tax Law & SDC Law appeared first on Chambersfield Economides Kranos.

One of the latest achievements of Chambersfield Economides Kranos is to receive the award of the Leading Adviser for Cyprus for 2021.

Acquisition International has been a monthly digital business magazine for more than 11 years.

Professionals in more than 170 countries rely on AI’s vital updates on business knowledge.

Each year AI nominates the leading business in different fields, such as Finance, Legal, NPO’s, Audit & Tax, CFO, Businesswoman and others.

For Chambersfield Economides & Kranos is the second time receiving a distinction from Acquisition International.

The first time was in 2019, for its Corporate Excellence and this year is appointed as the Leading Adviser for Cyprus.

More precisely, Chambersfield Economides Kranos is the leading Full-Service Cross-Border Law Firm of the year in Cyprus.

Chambersfield Economides Kranos is an international law firm with a physical presence in more than 9 countries and having offices in Limassol, London, and Singapore.

The legal firm provides a variety of services to international individuals and institutions.

A highly experienced team of professionals undertakes with ethos, professionalism, respect and personal approach, legal and business cases on all legal and corporate services.

The post Cyprus leading adviser appeared first on Chambersfield Economides Kranos.

Mediation is an Alternative Dispute Resolution Method (ADR Method) which can be an alternative option for resolving a dispute between two (or more parties), other than through the Courts.

Mediation, like other ADR Methods (such as Arbitration), has advantages over a court process: it is faster, more cost-effective, and involves the confidentiality of the process, as opposed to a trial which is a general procedure open to the public.

In addition, Mediation, has the added advantage of being a more conciliatory and peaceful way of resolving a dispute between two parties, without necessarily causing the two parties to derail and terminate the relationship and/or cooperation of the two parties, as is almost always the case when a dispute leads to Trial or Arbitration.

In terms of its practical application, it is a structured process (regardless of the name), in which two or more parties try to reach an agreement on resolving their dispute voluntarily with the help of a Mediator, as a third, a neutral, independent and impartial party.

This impartial third party is a Certified Mediator, who is selected jointly and with the consent of all parties involved in a dispute.

Ways, the Disputing Parties, can enter into a Mediation process in Cyprus:

Under the current legal regime in Cyprus, there are three ways for the disputing parties to enter into a Mediation process:

1) By a voluntary agreement of the parties when a dispute arises

2)  Through a Mediation Clause in a Contract signed between the parties

3) During a court case, when both parties agree or when one party requests it and the Court deems that this is the best course of action in this particular case (rare application).

Informatively, it should be noted that in other countries, such as Greece and Italy, there is a mandatory pre-trial mediation procedure prior to the adjudication of the civil action, something which is not currently applied in the Cypriot legal system.

The Stages of Mediation:

When and if the disputing parties enter into a Mediation process, then the Mediation process is divided into the following five stages:

1)Preparation:  Where any possible conflict of interest of the Mediator is examined, e.g., if he had previously cooperated with one of the parties of the dispute (as it also happens in an Arbitration process for the selection of an Arbitrator), the acceptance of his appointment, the drafting and signing of the agreement affiliating the dispute to Mediation, the Mediator’s briefing, the appointment of the session, the venue, and the authorizations by the parties.

2) Opening Statements: Both of the Mediator (where he outlines his role, the way the procedure is conducted and the ultimate goal which is the resolve of the dispute) and of the Parties (where each party expresses its position on the dispute being mediated).

3) Investigation: Where separate confidential discussions take place between the Mediator and the parties, questions, investigation of the history of the dispute and the pursuit of interests.

4) Negotiations: Where the parties with the help of the Mediator create options and solutions for the dispute with proposals and dialogue between them.

5) Dispute Settlement Agreement: In case of a successful mediation process, the dispute is closed with the «Mediation Settlement Agreement» signing.

Mediation Settlement Agreement

«The Mediation Settlement Agreement» is probably the most crucial part of Mediation, as the Mediation process (and what has been agreed in it) is not binding until the two parties sign the Mediation Settlement Agreement.

The Mediation Settlement Agreement is drafted up by the Mediator, where what has been agreed is recorded in writing. It is then signed by him, and the parties and a true copy is given to each party of the Mediation. In this case, any party involved can file and register the Mediation Settlement Agreement in Court (as it is the case with an Arbitral Award) and then an Implementing Order is issued, and the Mediation becomes fullybinding.

 Laws and Procedures governing Mediation in Cyprus

The Laws governing Mediation in Cyprus are the following:

Law on Certain Matters of Mediation in Civil Disputes of 2012 (159 (I)/2012), which is the national law that governs the application and the procedure of Mediation in Cyprus, as well as the qualifications that a potential certified Mediator should possess.

Additionally, the above law stipulates the existence of two separate Registers of Mediators which are kept by the Ministry of Justice of the Republic of Cyprus:

Register of Mediators for Commercial Disputes

 Register of Mediators for Civil Disputes other than Commercial Disputes

Directive 2008/52/EC of the European Parliament and of the Council, of 21 May 2008, on certain aspects of mediation on civil and commercial matters, where this European Directive applies in the event of cross-border disputes in civil and commercial matters other than certain rights and obligations which the parties are unable to decide on the basis of the applicable law, and which dispute may be referred to Mediation as an ADR.

The European Code of Conduct for Mediators, which is currently the applicable Code of Conduct for Mediators in Cyprus, as the Cyprus Code of Conduct for Mediators has not yet been created.

Law on Family Disputes Mediation of 2019 (Ν. 62(Ι)/2019), which regulates issues that fall within the scope of Family Law such as Property Disputes, Alimony, and the Use of the Family House. Matters concerning Divorce and Child Custody remain in the exclusive jurisdiction of the Family Court.

Furthermore, informatively, due to the peculiarity of Family Mediation, discussions and actions have been taken to create a third separate Register of Mediators for Family Disputes.

The Future of Mediation in Cyprus: 

In recent years the number of registered Mediators in Cyprus has increased dramatically and the interest of the business and commercial world in finding an ADR Method, both from the Court and from Arbitration, which is not confrontational, has turned the eyes of several stakeholders to Mediation as an economic, speedy confidential and peaceful option to resolve a dispute between 2 two parties.

*Το περιεχόμενο του παρόντος άρθρου έχει ισχύει κατά την ημερομηνία της πρώτης έκδοσής του. Αποσκοπεί στο στα παρέχει μια γενική εισαγωγή και καθοδήγηση στον εν λόγω θέμα και σε καμία περίπτωση δεν συνιστά νομική συμβουλή. Σας συνιστούμε να αναζητήσετε επαγγελματικές συμβουλές σχετικά με το συγκεκριμένο σας θέμα προτού προχωρήσετε σε οποιαδήποτε ενέργεια με γνώμονα τις πληροφορίες που περιέχονται στο πιο άνω κείμενο. Για περισσότερες πληροφορίες ή συμβουλές, παρακαλώ επικοινωνήστε με τον Ko. Χρίστο Γ. Γεωργίου, Δικηγόρο, Διαμεσολαβητή & Νομικό Σύμβουλο στην δικηγορική εταιρεία CHAMBERSFIELD ECONOMIDES KRANOS, στην Λεμεσό, τηλ. +357 25 356 800 ή στα emails c.georgiou@eklawyers.com, info@eklawyers.com.   

* The content of this article is valid as at the date of its first publication. It is intended to provide a general guide to the subject-matter and does not constitute legal advice. We recommend that you seek professional advice on your specific matter before acting on any information provided. For further information or advice, please contact Mr. Christos G. Georgiou, Advocate, Mediator & Legal Consultant at the Law Firm CHAMBERSFIELD ECONOMIDES KRANOS, in Limassol Cyprus, # +357 25 356 800 or email at c.georgiou@eklawyers.com, info@eklawyers.com.

The post Mediation in Cyprus: Legal, Procedural and Practical Application appeared first on Chambersfield Economides Kranos.

This question is among the most important queries that suppliers and customers try to answer after the pandemic declaration by the World Health Organization (WHO) on 11th of March 2020.

Undoubtedly, the coronavirus pandemic impact on the global economy and supply chain, heavily disrupted all the business operations and created massive negative effects.

Innumerable trade contracts have been affected by the lockdowns, travel restrictions and factory shutdowns worldwide.

In addition, firms with insufficient product line diversification and companies that followed limited shortage inventory system policies, were among the ones mostly affected, since from the beginning of the pandemic they started to experience significant difficulties and losses of revenue due to inventory shortage.

As we all know, product distribution is highly dependable on the supply chain’s efficiency and effectiveness, especially when cross – border transactions are in place.

It is undeniable that the supply chain industry heavily supports the global GDP.

Therefore, many governments in their attempt to protect their local suppliers have issued thousands of force majeure certificates and notices. The force majeure certificates and notices were used as a defense strategy for local suppliers to be exempted or suspended from their contractual obligations towards overseas buyers, due to the unforeseen and unpredicted conditions that the pandemic caused.

Force Majeure principles describe the out of anyone’s control unexpected events that prevent contractual parties to fulfil their contract obligations i.e. natural disasters, pandemics etc.

Having said that, not every agreement is eligible to be valid under the force majeure doctrine since the clauses included in the contract and governing laws of each jurisdiction, differs.

Consequently, it is advisable, as a sound practice, that all contracts, no matter the nature of the transaction or agreement or jurisdiction, are drafted by experienced lawyers, so as to include the rights and obligations of all parties involved and state the actions that should be followed in the case of a dispute or contract failure.

Thus, lawyers not only will specify the contractual parties’ relationships in the occurrence of a dispute, but they will also add clauses that will specify:

• in which events force majeure actions will come into force
• which party will be responsible for the possible financial losses in each specific event
• the contract governing law
• in which cases is the resolution of the contract acceptable, with no further legal consequences other than the ones specified in the contract etc.

The risks of COVID-19 outburst lie on the inability of businesses to meet their contractual obligations in the event which, the business’ operations are being disturbed by the coronavirus pandemic or governmental restrictions.

Who is accountable for those losses? The supplier, The customer or Both.

Unfortunately, who is held responsible is at fault and who will bear the financial losses when a supplier cannot meet customers’ orders is not a straightforward answer.

In the event of a pandemic outbreak, suppliers should carefully assess their legal contracts clauses and determine which sections apply to the exact event and specify if the conditions stated in the contract provide solutions for this event.

Furthermore, suppliers should examine if the specific event is directly correlated with the cause of not meeting the contract obligations and then examine if the specific cause was the one that affected their performance.

Moreover, suppliers should determine if the force majeure principle can apply on the specific event and examine if the legal framework of the contract’s governing law justifies the reasoning of the force majeure for not meeting contract obligations.

To sum up, everything depends on the contract terms and conditions, as well as the governing law of the contract, since there is no global one-size fits approach for countries.

What is more, suppliers may put into effect additional strategies that will assist them to minimize the consequences of the outbreak and cope with the risks caused by the pandemic.

Suppliers Crisis Management

First and foremost, suppliers should try to negotiate with customers directly and try to identify, as well as suggest possible ways of solving the problems in the supply chain.

Some “relief strategies” that suppliers may adopt are:

• prolonging the lead delivery time to customers
• prioritizing orders according to delivery time requirements per contract
• postponing new incoming orders or extending the proposed delivery time
• allowing cancellations for a short period of time etc.

Second, suppliers should form a crisis management plan that will include amongst others:

• Identification of the problem and analysis of all the reasons that are affecting the supply chain’s performance (i.e. lockdowns, travel restrictions, quarantine, staff illness, governmental restrictions etc.) It is extremely important for suppliers to document all the reasonings and determine which whys disturb the supply chain’s flow and how those causes affect the supply chain’s performance at all levels, so as to be able to proceed with the correct management decisions and avoid contracts terminations and minimize financial losses.
• Recognition and legal analysis of the risks involved, in accordance with the contract clauses and contacts governing law.
• The formation of outsourcing agreements with affiliate suppliers situated in operational areas, not heavily affected from the pandemic. With this “mitigating risk strategy”, suppliers may be able to support their production and overcome the supply chain problem for a short period of time.

Third, when suppliers have exclusivity contracts with customers, it is highly recommended to review those contracts with great caution with their legal associates and give emphasis to the clauses of delays, delivery failure, force majeure, reasons for contract termination etc.

Last but not least, suppliers in cooperation with their legal associates should review very carefully the dispute resolution section of their contract with customers and/or affiliates, so as to determine their legal rights and be in the position to negotiate.

Supply chains are amongst the most vital, complicated thus advanced industries of the world that allow minimum delays and disruptions, due to cost and inventory optimization policies by the companies.

Serious disturbances, i.e. coronavirus pandemic, may result to massive losses around the globe and serve as a tricker point of a global economic recession.

Therefore, suppliers by acknowledging the vulnerability of the supply chain industry should seek the consultation of legal and business consultants to assist them in forming a crisis management plan that will include reasonable solutions with immediate enforcement, so as to safeguard their companies’ operations and future.

The post Covid-19 and Supply Chain Breach of Contracts. Who is accountable? appeared first on Chambersfield Economides Kranos.

Article Publication: Forbes Magazine April 2019

Our era is characterized by intense economic, political, social fluctuations, technological changes and complex legal conditions, which, combined with the companies’ activities in an internationalized and fully legislated environment, make the Legal Advisor an important key partner when conducting business.

The Legal Advisor, due to its specialized knowledge of the legal framework, is the most suitable partner, who meets the requirements to provide professional consulting services to the entrepreneurs.

Besides, it is no coincidence that several modern companies cooperate with law firms on a yearly basis to provide legal and advisory services, covering their entire activities range and their legal relationships with customers as well as their employees.

The importance of a Legal Advisor for the businesses is essential, especially in matters such as business’ strategic actions mainly aimed at reducing and minimizing the risks, increasing the activities as well as improving their management and operation.

The Legal Advisor in association with the entrepreneur can design and create the appropriate development conditions by implementing strategies intended to achieve the set goals.

For example, in many cases, our company has been called upon to advise and undertake the formation of strategic prerequisites for:

• Optimizing the company’s organizational structure
• Establishment of subsidiaries in more favorable jurisdictions
• Creating effective strategies for collecting outstanding amounts
• Creating strategies including corporate loan restructuring, for a more efficient management
• Drafting new trade agreements and exploiting business opportunities
• Forming franchise
• Evaluation of investments for further expansion of the existing portfolio as well as liquidation of businesses that harm and negatively affect the viability of the business and significantly increase operating expenses
• Generating strategies for improving asset performance and utilization
• Intellectual Property registration which is considered an intangible asset
• Drafting manuals for actions and procedures to be followed within the company in order to harmonize the business in accordance with:

*  The AML (Anti-Money Laundering) guidelines to prevent and combat money laundering,

*  The guidelines of the European regulation concerning the protection of personal data of European citizens in a global scale. (GDPR)

*  Τhe legal framework governing the jurisdictions in which the companies operate (Legal Audit)

My personal viewpoint is that all strategies of modern businesses must be thoroughly studied and after the proper legal guidance, to be adopted. This is mainly because the corporate and legal framework cannot be easily understood because of specific conceptual terms involved.Every transaction, agreement and operation is considered to follow the legislative framework while the legal advice ensures complete harmonization.

As a lawyer and founder of the international law firm Chambersfield Economides Kranos, I therefore advise entrepreneurs to establish a systematic partnership with a well-established law firm which specializes in corporate, commercial and labor law, has the knowledge and experience in the business, financial and investment sectors and be distinguished and well-established in the domestic and international market.

The post Legal Advisors & Businesses appeared first on Chambersfield Economides Kranos.

Ακολουθεί Ελληνική Μετάφραση

Tenancy of Real Estate | Rights and Liabilities

The rights and obligations of property Landlord and Tenants, as they arise from the national existing and applicable laws, justifies that the current legislation needs immediate reorganization and restructuring.

The existing legislation, as far as it concern the property landlords, contains a series of processes and steps that need to be followed in order for the landlord to reach an eviction of a tenant who violates his/her responsibilities and to recover possible outstanding due rents.

On the other hand for the Tenants the current legislation provides several safety and security safeguards, provided that they comply with their obligations mentioned in their contract.

In this article Mr Michalis Economides centres his attention to the necessity of having a well structured lease agreement that will indicate clearly the rights and obligations of both parties by taking into consideration all the conceivable possible future scenarios.

Furthermore, Mr Economides strongly recommends some key points, in connection to which, the legislation authorities must take an immediate action through amendments in the current legislation and procedures that will enable both entities to solve their disputes in a shorter time.

Below you can read the whole article published at capital.com.cy.  In order to translate it please select the preferable language on the top right of the page.

Ενοικιάσεις: Ιδιοκτήτες και Ενοικιαστές – Δικαιώματα και Υποχρεώσεις

Άρθρο κ. Μιχάλη Οικονομίδη, CEO της Διεθνούς Δικηγορικής Εταιρίας Chambersfield  Economides Kranos στο Capital.com.cy

Τα δικαιώματα και οι υποχρεώσεις των Ιδιοκτητών ακινήτων και Ενοικιαστών όπως αυτά πηγάζουν μέσα από την υφιστάμενη και ισχύουσα νομοθεσία, μαρτυρούν ότι η εν λόγω νομοθεσία χρίζει άμεσης αναδιοργάνωσης και αναδιαμόρφωσης.

Αυτό που καλούμαστε να αντιμετωπίσουμε είναι από τη μια πλευρά τους Ιδιοκτήτες ακινήτων και από την άλλη πλευρά τους Ενοικιαστές – οι δύο όψεις του ιδίου νομίσματος. Ο νόμος οφείλει να προστατεύει ακόμα και τον πιο αδύναμο καθώς επίσης και να παρέχει δίκαιη προστασία και στα δύο μέρη.

Η υφιστάμενη νομοθεσία, όσον αφορά τους Ιδιοκτήτες ακινήτων, εμπεριέχει σωρεία διαδικασιών και σταδίων στα οποία είναι αναγκασμένος και υποχρεωμένος να καταφύγει ένας ιδιοκτήτης εως ότου φτάσει στην έξωση και στην ανάκτηση των οφειλόμενων ποσών των ενοικίων.

Υποθέσεις τέτοιας φύσεως, μπορεί να διαρκέσουν από τρεις μήνες μέχρι και τέσσερα χρόνια, επιφέροντας σε αρκετές περιπτώσεις καταστροφικές συνέπειες προς τους Ιδιοκτήτες. Η μη καταβολή των μηνιαίων ενοικίων από τους Ενοικιαστές , προς τους Ιδιοκτήτες, επιφέρει αλυσιδωτά προβλήματα και στην οικονομία. Ουκ ω λίγες φορές , οι ίδιοι οι Ιδιοκτήτες ακινήτων έρχονται αντιμέτωποι με τις τράπεζες στις οποίες τα εν λόγω ακίνητα είναι υποθηκευμένα και όπου τα μηνιαία ενοίκια καταβάλλονται έναντι των δανείων τους.

Οι Ιδιοκτήτες έχουν επίσης υποχρεώσεις προς τους Ενοικιαστές. Θα πρέπει να τονιστεί ότι ο κάθε ιδιοκτήτης ξεχωριστά είναι υπόχρεος να σέβεται τους Ενοικιαστές του. Συνεπάγεται δε, ότι οι Ιδιοκτήτες δεν έχουν κανένα δικαίωμα να εισέρχονται στα ακίνητα χωρίς την γραπτή άδεια ή συγκατάθεση των Ενοικιαστών ή χωρίς την εξασφάλιση άδειας από το Δικαστήριο. Ο κάθε ενοικιαστής έχει το δικαίωμα στην ελεύθερη και αποκλειστική χρήση του ενοικιαζόμενου ακινήτου. Όσον αφορά τους Ενοικιαστές και τα δικαιώματα τους, η υφιστάμενη  νομοθεσία, παρέχει αρκετές δικλίδες ασφαλείας και προστασίας προς τους Ενοικιαστές , νοουμένου ότι τηρούν τις υποχρεώσεις τους όπως αυτές εμπίπτουν μέσα από τα ενοικιαστήρια έγγραφα.

Δεδομένου του προαναφερθέντος, μπορούν να απολαμβάνουν ελεύθερα την κατοχή και χρήση του ενοικιαζόμενου υποστατικού. Έχοντας ως γνώμονα τη σωρεία προβλημάτων τα οποία προκύπτουν και αφορούν τις ενοικιάσεις και τα οποία καλούμαστε να χειριστούμε καθημερινά, είναι αποδεκτό ότι η σωστή πρακτική η οποία θα πρέπει να ακολουθείται, απαιτεί την ορθή ετοιμασία ενός καλά δομημένου ενοικιαστηρίου εγγράφου.

Ένα καλά δομημένο ενοικιαστήριο έγγραφο, θα πρέπει να είναι συνταγμένο με τέτοιο τρόπο ο οποίος θα καλύπτει όλα τα πιθανά σενάρια τα οποία ίσως προκύψουν μελλοντικά και για τους Ιδιοκτήτες αλλά και για τους Ενοικιαστές και θα πρέπει επίσης να καλύπτει υποχρεώσεις και δικαιώματα και των δύο μερών.

Είναι ορθό και πρέπον τα ενοικιαστήρια έγγραφα πάντοτε να είναι αυστηρά σε σημείο που θα παρέχονται τέτοιες εξασφαλίσεις μέσω εγγυήσεων ή άλλων προνοιών, ούτως ώστε να επιτυγχάνεται η σωστή τήρηση των όρων του ενοικιαστηρίου εγγράφου, για την αποφυγή μη είσπραξης ή καθυστέρησης είσπραξης των ενοικίων.

Προσοχή επίσης χρειάζεται στην σύναψη ενοικιαστηρίου εγγράφου με νομικές οντότητες (εταιρείες), όπου αρκετές φορές οι Ιδιοκτήτες, μένουν εκτεθειμένοι λόγω υπογραφής ενοικιαστηρίων εγγράφων, χωρίς τις απαραίτητες προσωπικές εγγυήσεις φυσικών προσώπων.

Αυτό το σενάριο, σε μια πιθανή δικαστική διαμάχη, αφήνει εκτεθειμένους τους Ιδιοκτήτες λόγω του ότι η νομική οντότητα μπορεί πλέον να μην υφίσταται ή να μην έχει τις απαραίτητες οικονομικές εξασφαλίσεις ή περιουσιακά στοιχεία προς κάλυψη του οφειλόμενου ποσού των ενοικίων στους Ιδιοκτήτες.

Προσωπική μου εισήγηση, είναι ότι η υφιστάμενη και ισχύουσα Νομοθεσία και οι Κανονισμοί της Κυπριακής Δημοκρατίας, οι οποίοι αφορούν τις ενοικιάσεις, θα πρέπει να τροποποιηθούν υιοθετώντας μεταξύ άλλων τα πιο κάτω σημεία:

α) Θα πρέπει να υπάρχει μια κοινή νομοθεσία και διαδικασία για όλα τα ακίνητα, για όλων των ειδών ενοικιάσεις, για όλες τις περιοχές της Κυπριακής Δημοκρατίας. Δηλαδή όλες οι υποθέσεις θα πρέπει να εκδικάζονται από τα Επαρχιακά Δικαστήρια και να μην υπάρχει διαχωρισμός μεταξύ Δικαστηρίων και Νομοθεσιών. Σήμερα η διαδικασία η οποία θα πρέπει να ακολουθηθεί στο Δικαστήριο καθορίζεται από τη περιοχή ή από την ημερομηνία ανέγερσης του υποστατικού. Τα εν λόγω στοιχεία αποτελούν τις προϋποθέσεις για το αν η υπόθεση θα προχωρήσει στο Πολιτικό Δικαστήριο ή στο Δικαστήριο Ελέγχου Ενοικιάσεως. Η διαδικασία μπορεί να αλλάξει και να απλοποιηθεί εφαρμόζοντας νέες νομοθεσίες και κανονισμούς ώστε να μπορούν να εφαρμόζονται πιο εύκολα και να είναι πιο ξεκάθαρη, αποδοτική και σύντομη η εκδίκαση των υποθέσεων. Όλες οι υποθέσεις θα πρέπει να εκδικάζονται στα Επαρχιακά Δικαστήρια αφού υπάρχει μεγαλύτερος αριθμός διορισμένων δικαστών από ότι στα Δικαστήρια Ελέγχου Ενοικιάσεως, κάτι το οποίο θα βοηθήσει στην πιο γρήγορη και αποτελεσματική εκδίκαση των υποθέσεων. Προσωπικά θεωρώ ότι ο διαχωρισμός ακινήτων με βάση τη χρονολογία ανέγερσης και τοποθεσία ώστε να εμπίπτει υπό διαφορετικές νομοθεσίες και/ή κανονισμούς, είναι πεπαλαιωμένο σύστημα το οποίο χρίζει εκσυγχρονισμού και απλοποίησης.

β) Να παύσει να ισχύει ο όρος “θέσμιος” ενοικιαστής. “Θέσμιος” Ενοικιαστής, ονομάζεται ο Ενοικιαστής ο οποίος μετά τη λήξη και/ή τερματισμό του ενοικιαστηρίου εγγράφου παραμένει στο υποστατικό με τα ίδια δικαιώματα και υποχρεώσεις όπως απορρέουν από το ενοικιαστήριο έγγραφο. Εισηγούμαι όπως μετά τη λήξη και/ή τερματισμό του ενοικιαστηρίου εγγράφου τα ακίνητα τα οποία, με την  παρούσα Νομοθεσία, εμπίπτουν σε περιοχές οι οποίες ελέγχονται από τον Περί Ενοικιοστασίου νόμο να μην μπορούν να θεωρούνται ότι ακόμη έχουν δικαίωμα ενοικίασης επί του εν λόγω υποστατικού και να υπογράφεται εκ νέου ανανέωση των ενοικιαστήριων εγγράφων.

γ) Συντόμευση και απλοποίηση των δικαστικών διαδικασιών εφαρμόζοντας μόνο μια κοινή διαδικασία στο Δικαστήριο, όπου το τελεσίδικο αποτέλεσμα της και η έκδοση μιας απόφασης, θα επιφέρει την άμεση έξωση του Ενοικιαστή σε περίπτωση παραβίασης των όρων του  ενοικιαστηρίου εγγράφου. Σήμερα, με τις υφιστάμενες διαδικασίες ακόμη και να εκδοθεί απόφαση του Δικαστηρίου, ο ιδιοκτήτης πρέπει να προχωρήσει σε επιπρόσθετες αιτήσεις και διαδικασίες για να ανακτήσει την κατοχή του υποστατικού του και να εισπράξει τα οφειλόμενα ενοίκια. Η όλη δικαστική διαδικασία πρέπει να γίνει πιο σύντομη και πιο απλή όπου με την απόδειξη του οφειλόμενου ποσού και/ή άλλων παραβάσεων της συμφωνίας, να υπάρχει άμεση εκδίκαση της υπόθεσης που δε θα υπερβαίνει τους 6 μήνες.

Θα πρέπει να γίνει μια σωστή αναδιοργάνωση των Νόμων και Κανονισμών που αφορούν τις ενοικιάσεις για την προστασία των συμπολιτών μας οι οποίοι συναλλάσσονται με τέτοιου είδους δραστηριότητες.

Ο νόμος οφείλει να προστατεύσει ακόμα και τον πιο αδύναμο και οφείλουμε να το χειριστούμε εμπράκτως.

*Ο Μιχάλης Οικονομίδης είναι Δικηγόρος & Νομικός Σύμβουλος, CEO της Δικηγορικής Εταιρείας CHAMBERSFIELD ECONOMIDES KRANOS και της διεθνούς εταιρείας εταιρικών υπηρεσιών GFA Trust

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on the basis of subsection (2) of section 111A of the Civil Registry Laws of 2002-2015

The Council of Ministers of the Republic of Cyprus, on the 13th of September 2016 has issued an amended Regulation in relation to the Scheme for Naturalisation (Citizenship) of Investors in Cyprus by Exception.

One of the main objectives of the economic policy of the Republic of Cyprus is to further encourage Foreign Direct Investment and to attract high net worth individuals to settle and do business in Cyprus.

Key factors that make Cyprus an attractive destination for investment, is the highly specialized human capital, the reliable legislative and regulatory framework, the stable tax system and the safety and stability conditions prevailing in the country.

Within this framework and taking into account the strong investor interest, the Government of Cyprus has established and revised a “Scheme for Naturalization of non-Cypriot investors by exception” on the basis of subsection (2) of section 111A of the Civil Registry Laws of 2002-2015, with specific incentives, terms and conditions and control procedures in order to prevent abuse.

The changes are considered to be more attractive to investors that wish to obtain an EU/Cyprus citizenship.

The threshold of investment has been reduced to €2 million all together (if the investor has invested in housing properties and the value of at least one of them is at least €500.000. If the main investment is not in housing properties then the investment is €2m plus a residential unit of €500.000).

Another important positive change is that the parents of the main applicant are also eligible to apply and obtain the Cyprus/EU citizenship provided that they purchase a housing property of at least €500.000 (therefore they will not need to proceed with any main additional investment).

The “collective” scheme has been abolished by the new Regulation.

On the basis of the Scheme, a non-Cypriot citizen, who meets one of the following economic criteria (A), either personally or through a company/ companies in which he/ she participates as a shareholder – in proportion to his holding percentage, or through investments done by his/her spouse or jointly with the spouse or even as a high-ranking senior manager of a company/ companies that meets one of the economic criteria (A), may apply for the acquisition of the Cypriot citizenship through naturalization by exception.

Α. CRITERIA

Α.1 Investment in real estate, land development and infrastructure projects:

The applicant must have made an investment of at least €2,0 million for the purchase or construction of buildings or for the construction of other land development projects (residential or commercial developments, developments in the tourism sector) or other infrastructure projects.

It is noted that investment in land under development is included in this criterion, provided that an investment plan for the development of the purchased land will be included in the application. It is understood that investment in land that is situated in a building zone of zero development, is excluded.

Α.2 Purchase or Establishment or Participation in Cypriot Companies or Businesses:

The applicant should have made a purchase or should have participated in companies or organizations established and operating in the Republic of Cyprus with investment costs of at least €2,0 million. The invested funds shall be channeled towards the financing of the investment objectives of these companies exclusively in Cyprus, based on a specific investment plan.

The applications shall be evaluated to verify that the companies or organizations have proven physical presence in Cyprus, with significant activity and turnover and employ at least five (5) Cypriot or citizens of European Union member-states. The minimum number of employees shall increase, if more than one applicant invest simultaneously or almost simultaneously in the same business or company. In addition, the employees of the companies need to have legally and continuously resided in Cyprus during the five years preceding the application submission date.

Α.3 Investment in Alternative Investment Funds or financial assets of Cypriot companies or Cypriot organizations that are licensed by CySec :

The applicant should have bought units of at least €2,0 million from alternative investment funds (AIF) established in the Republic of Cyprus, licensed and supervised by the CySec and whose investments are made exclusively in the Republic of Cyprus, in investments that meet the criteria of this Scheme or in areas approved by the Minister of Finance.

In order to confirm that the investments that meet the criteria of the current Scheme will be kept for at least three years, the manager or the auditor of the Fund shall inform in writing and on an annual basis, the Ministries of Finance and Interior with reference to the value of the initial investment.

The purchase of financial assets of Cypriot companies or organizations of at least €2,0 million, such as bonds, bills and securities, issued with the approval of the CySec, by companies that have proven physical presence and substantial economic activity in the Republic of Cyprus, and have as a purpose the financing of the investment plans of these companies or organizations exclusively in Cyprus, based on an investment plan, fall under this criterion.

It is noted that the purchase by an AIF of units of other AIFs is not considered eligible.

Α.4 Combination of the aforementioned investments:

The applicant may proceed with a combination of the above investments, provided that the total investment will amount up to at least €2,0 million.

Within this criterion (combination of investments) the applicant may purchase special government bonds of the Republic of Cyprus, up to €500.000, which will be issued by the Public Debt Management Office of the Ministry of Finance, on condition that the investor will retain these bonds for a three year period. The characteristics and the terms of these special bonds will be determined by the General and Special Issue Terms of the Government Bonds of the Republic of Cyprus. Investments in government bonds through the secondary market are not considered eligible.

B. TERMS AND CONDITIONS

1. Clean Criminal Record: the applicant must have a clean criminal record. Furthermore, his name must not be included in the list of persons whose assets, within the boundaries of the European Union, have been frozen as the result of sanctions.

2. Residence in the Republic of Cyprus: In all cases listed in Part A, the applicant must possess a permanent privately-owned residence in the Republic of Cyprus, the purchase price of which must be at least €500.000, plus V.A.T.

It is noted that members of the same family, who apply separately as investors, can collectively acquire a residence, provided that the total value of this home-property covers the amount of €500.000 per each applicant.

In case that the purchase value of the permanent privately owned residence in Cyprus exceeds the amount of €500,000, part of this additional amount can be used for purposes of supplementing the total amount of the investment made on the basis of the criteria of Part A above.

Additionally, it is noted that if the applicant has invested in housing unit/units on the basis of the aforementioned criterion A.1, the purchase of another permanent residence in Cyprus will not be required, if at least one of these housing units is worth at least €500,000, plus VAT, provided that the applicant retains the possession of the residence for life.

3. Residence Permit in Cyprus: The applicant, prior to his/her naturalization as a Cypriot citizen must hold a residence permit in Cyprus.

If the applicant does not already hold a residence permit, he/she may apply for an immigration permit on the basis of Regulation 6 (2) of the Aliens and Immigration Law, simultaneously with the application for naturalization. If the application for acquiring an immigration permit is made solely for purposes of acquiring the Cypriot citizenship, in accordance with the provisions of this Scheme, there are no other conditions than those stated in both Part A and Part B of this Scheme.

It is noted that all of the above also apply for the adult members of the family of the investor, who will apply for naturalization.

In case the application for naturalization is rejected for any reason, the immigration permit, obtained in accordance with the provisions of this Decision, will be canceled immediately.

C. SUBMISSION OF DOCUMENTS

For the evaluation of the applications the form (M127) as well as the following documents must be submitted:

1. Clean Criminal Record:

Certificate of Clean Criminal Record from the country of origin and the country of residence (if different).

2. Residence in the Republic of Cyprus:

(a) Contract of Sale.

(b) Title Deeds or Proof of Registration of the contract with the Lands and Surveys Department.

(c) Proof of payment of the agreed purchase price.

(d) Copy of the wire transfer to a Cypriot commercial banking institution in the name of the seller or the seller’s company.

(e) An evaluation certificate from an independent registered land surveyor, if required by the Ministry of Interior or the Ministry of Finance.

3. Criteria regarding the investment (when applicable):

(a) Certificate of Registration of the company/ companies by the Registrar of Companies.

(b) Certificate of shareholders by the Registrar of Companies or certificates evidencing that the applicant is the beneficiary owner of the company/ companies.

(c) Audited accounts of the company (or companies) for the last three years preceding the year of the application.

(d) If the applicant is a high-ranking senior manager, the submission of the employment contract and the receipt from the Department of Inland Revenue are additionally required.

(e) If the investment is made by the spouse of the applicant or jointly, a marriage certificate is required.

Furthermore, depending on the case, the following are required:

1. Investment in real estate, land development and infrastructure projects

(a) Contract of sale.

(b) Title Deeds or Proof of Registration of the contract with the Lands and Surveys Department. (c) Proofs of payment of the agreed purchase price.

(d) Copy of the wire transfer to a Cypriot commercial banking institution in the name of the seller or the seller’s company.

(e) An evaluation certificate from an independent registered land surveyor, if required by the Ministry of Interior or the Ministry of Finance.

(f) Investment Plan for the development of the purchased land, if the investment involves the purchase of land under development

2. Purchase or Establishment or Participation in Cypriot Companies or Businesses

(a) Contract of sale.

(b) Proof of payment of the agreed purchase price.

(c) Certificate of shareholders by the Registrar of Companies.

(d) Copy of the wire transfer to a Cypriot commercial banking institution in the name of the company or the organization.

(e) Specific investment plan.

(f) Copies of the employment contracts of the Cypriot or European Union citizens employed by the company in which the applicant has invested.

(g) Confirmation from the Social Insurance Department as to the insurable income of the Cypriot or European Union citizens employed in the company.

(h) Copy of the Social Insurance Contributions for every Cypriot or European Union citizen employee.

(i) Registration Certificate (MEU1) or Permanent Registration Certificate of Union Citizen (MEU3) for employees that are European Union citizens.

3. Investment in Alternative Investment Funds or financial assets of Cypriot companies or Cypriot organizations that are licensed by CySec:

(a) Title/Titles and other relevant documents of the financial assets / units purchased.

(b) Copy of the wire transfer to a Cypriot commercial banking institution in the name of the company or the organization.

(c) Specific investment plan.

(d) Confirmation by the CySec.

4. Investment in government bonds:

(a) Proof from the Public Debt Management Office for the purchase of special government bonds.

(b) Copy of the wire transfer into a bank account of the Treasury of the Republic of Cyprus.

Any other document that might be requested either by the Ministry of Interior, or by the Ministry of Finance.

None of the above affects the absolute discretion of the Cabinet of Ministers on taking a decision.

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Chambersfield Economides Kranos is an International Law firm that offers complete legal and corporate services, with physical presence in more than 7 countries and provision of fiduciary and corporate services in more than 21 countries. The firm deals with all legal practice areas and the lawyers within can cope with cases regarding any multi jurisdictional issue worldwide.

The firm’s cross-border experience and knowledge of the worldwide rapid changes enables it to thoroughly assess and comprehend the market perspectives. The company provides solutions and can advise private users as well as corporate entities on how to handle private issues and disputes with discretion, how to manage their existing investments or evaluate new investment opportunities as well as how to form a successful portfolio of investment with the greatest percentage of return. Additionally, our expertise allows us to serve as an advisors / consultants for wealth management, tax restructuring, risk analysis, management and administration of Trusts at a global level, etc.

Moreover, the firm’s advisory knowledge covers the entire main business field under International Law practice and ranges from the financial, management and banking sector to the incorporation, administration of corporations and fiduciary services, fund registration and management expanding to various other related practice areas.

The company’s Immigration Law Department has an extensive experience and expertise in regards to Economic Citizenships and Permanent Residence plans worldwide. The firm is able to suggest solutions that are fully compliant with the legal provisions of each and every jurisdiction, in which the client wishes to obtain Citizenship/Passport or Permanent Residence. The firm operates closely with Cyprus, Latin America and Caribbean approved schemes as well as other immigration schemes.

Chambersfield Economides’ Kranos line of thinking is innovative and exclusive.

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