New foreign business strategy unveiled

The government has presented its new strategy to attract companies, emphasising high-tech, research and innovation.

Implementation of the strategy expected to start from January 2022.

During a presentation at the Presidential Palace Friday, President Nicos Anastasiades said it would be important for attracting companies to operate or expand their activities in Cyprus.

Considering best practices from other European countries, it aspires to make Cyprus a Sustainable Business and Trade Centre of the broader region and Europe.

“The emphasis is on domains related to high technology, shipping, innovation, research and development, biogenetics and biotechnology, without excluding any other companies that choose Cyprus.”

Anastasiades said this strategy is in line with the guidelines of the European Commission and the Recovery and Resilience Facility.

“The implementation of the strategy and the establishment and operation of international companies in Cyprus will offer high and sustainable added value to the economy by creating new jobs and increased demand for domestic services, but will also redefine the country’s development model.”

Finance Minister Constantinos Petrides said it offers further tax incentives and corrects some distortions in labour issues and the immigration regime.

He also said that there’s competition between European countries in attracting such investments, with many countries having their own programs.

“I believe that ours is a very competitive programme.”

A Business Facilitation Unit is established to function as the focal point of contact for all companies of international interest, either operating in Cyprus or wishing to operate in the country. It includes shipping companies, high-tech or innovation companies, pharmaceutical companies or firms active in biogenetics and biotechnology.

This Unit will facilitate work permits for high skilled third-country employees, with a minimum gross monthly salary of EUR 2,500. At the same time, a university degree, title, equivalent qualifications or certificates of relevant experience are also needed.

The maximum work permits for thirdcountry nationals per company are set at 70% of all employees over five years.

The permits will be issued within one month and will last up to three years, while employee’s spouses will also have access to the country’s labour market.

Cyprus will also grant the so-called Digital Nomad Visa for people who wish to live in Cyprus but work in companies operating abroad.

Beneficiaries will be third-country nationals who work remotely using information and communication technologies for employers and clients outside Cyprus.

The visa will be granted for twelve months, with the right to renew it for another two years.

The beneficiaries should have salaries of at least EUR 3,500 per month, medical coverage and a clean criminal record from the country of residence.

Tax exemptions that apply to foreign high skilled employees in the Republic are extended for 17 years.

The existing tax exemption is also being extended to cover new residents-employees with a yearly salary of EUR 55,000 or more with a tax exemption of 50%.

Existing employees have the opportunity to extend the benefit from 10 to 17 years.

Potential beneficiaries are those on incomes between EUR 55,000 and 100,000.

These tax incentives also apply to Cypriots who have lived abroad for at least ten years and wish to repatriate to the Republic.

Employees of these companies will have the right to submit an application for naturalisation after five years of residence and work in the Republic or after four years if they have a recognised certificate of very good knowledge of the Greek language.

The transfer of social security contributions will also be ensured through bilateral agreements.