With a well-established non-domicile regime and the recent alignment of its immigration rules with the EU Blue Card Directive, Cyprus already stands out as one of the most attractive EU jurisdictions for highly skilled professionals. Furthermore, the February 2025 tax reform proposals, though not yet enacted, signal a commitment to enhancing an already competitive environment, introducing measures aimed at extending non-dom benefits, broadening residency eligibility, and refining personal income taxation.

Together, these developments underscore Cyprus’s unique positioning at the intersection of low-tax living and full EU mobility. For tech founders, asset managers, and internationally mobile professionals, Cyprus offers a framework that is both robust today and set to become even more compelling.

Table of contents

• The upgraded non-dom regime

• Redefining tax residency rules

• EU Blue Card: your mobility pass

• Strategic outlook for professionals

• Final thoughts & future outlook

The upgraded non-dom regime

Cyprus’s non-domicile regime, launched in 2016, has become a leading incentive for high-net-worth individuals, international professionals, and entrepreneurs seeking tax efficiency within a European Union jurisdiction. The framework operates under the combined application of the Income Tax Law 118(I)/2002 (IT Law), the Special Defence Contribution Law 117(I)/2002 (SDC Law), and the Wills and Succession Law Cap 195 (W&S Law), all as amended. The 2025 proposed reforms retain the strategic advantage of the rules and introduce certain improvements.

The benefits for non-doms remain substantial:

• exemption from Special Defence Contribution (SDC) on dividends, interest, and foreign rental income

• no capital gains tax on securities (with the exception of Cyprus-based real estate)

• no wealth, gift, or inheritance tax

• income over €100,000 remains eligible for the 50% exemption for 10 years

Employment income attractiveness is now being enhanced; the tax-free threshold increases to €20,500. New personal deductions for families, mortgage interest, and green investments provide further tax planning opportunities, especially for those building a life in Cyprus. Moreover, the proposed reforms allow indefinite extension of non-dom status, subject to an annual fee. This replaces the previous 17-year cap, offering long-term fiscal planning security.

This evolution of the non-dom regime ensures Cyprus remains a long-term base for wealth preservation and a safe haven in an increasingly competitive EU tax environment.

Redefining tax residency rules

Cyprus currently offers two main residency routes:

• the 183-day rule, based on physical presence

• the 60-day rule, allowing tax residency with a shorter stay if you have economic ties and no other residency

Under the 2025 proposals, the 60-day rule is expanded to include individuals whose centre of business interests lies in Cyprus, even if their physical presence is minimal. This change shifts the emphasis toward economic substance over physical relocation; a major win for remote professionals and international entrepreneurs.

This makes Cyprus particularly attractive to:

• digital nomads managing global ventures

• startup founders looking to anchor operations in an EU jurisdiction

• executives coordinating group structures from abroad

In essence, the redefined rules break the traditional link between tax residency and constant presence, giving entrepreneurs far more flexibility in how they manage their time and tax exposure. To benefit, applicants must still demonstrate business operations or key economic decision-making located in Cyprus, and ongoing compliance with IT and SDC law through filings and declarations.

This change modernises Cyprus’s tax framework, aligning it with a global workforce increasingly untethered from fixed locations.

EU Blue Card: your mobility pass

As of 7 July 2025, Cyprus has implemented the EU Blue Card, aligning its immigration framework with Directive (EU) 2021/1883. This harmonised permit offers third-country nationals a clear route into the EU job market. Combined with the tax advantages Cyprus offers, it’s a compelling package.

Eligibility requires:

• a university degree or three years’ recent experience in a relevant field

• a binding offer of employment in ICT, pharma R&D, or shipping (excluding seafaring roles)

• a minimum gross annual salary of €43,632

Benefits of the Blue Card include:

• the right to live and work in Cyprus

• equal treatment with nationals in employment, education, and social security

• family reunification

• short-term travel within the EU (90 days)

• mobility to another EU Member State after 12 months of residence in Cyprus

This allows skilled professionals to not only secure a favourable tax base but also leverage EU-wide mobility for business or career growth.

Combined with the non-dom regime, the Blue Card transforms Cyprus into a regional gateway—one where talent can establish, grow, and scale cross-border ambitions with minimal friction.

Strategic outlook for professionals

The combination of a more flexible residency framework, an extended non-dom regime, and a fully functional Blue Card system puts Cyprus in a league of its own.

Subject to the official adoption of the proposed reform:

• non-dom status can now be maintained indefinitely with a fee, offering certainty rare in EU tax law

• residency via economic interest frees professionals from the need to physically relocate

• new deductions support family life, real estate investment, and green upgrades—aligning tax incentives with personal priorities

• the corporate tax rate may increase to 15%, but strategic advantages remain via extended loss carryforward (from 5 to 10 years) and continued support for IP Box, Notional Interest Deduction, and Tonnage Tax regimes

Whether you’re relocating as a professional or scaling a business through Cyprus-based entities, these changes empower you to structure your affairs with predictability, compliance, and efficiency.

Final thoughts & future outlook

Cyprus’s 2025 reforms are more than just technical updates—they represent a broader vision for economic competitiveness. By expanding access, rewarding substance, and aligning incentives with modern lifestyles, Cyprus offers a model worth watching.

For professionals seeking an EU base without punitive tax consequences, or for businesses aiming to attract and retain top global talent, the updated framework presents an increasingly compelling proposition.

The true potential lies in combining available instruments: Blue Card access, non-dom optimisation, and carefully structured long-term planning. With the legal and fiscal tools firmly in place, the jurisdiction enables strategic decision-making that balances compliance, opportunity, and resilience across shifting international environments.

For tailored legal guidance on non-dom planning, EU Blue Card applications, or cross-border structuring, contact our team at Chrysses Demetriades & Co LLC.

The European Accessibility Act (EAA) introduced a harmonised framework across the EU to enhance access to key products and services for persons with disabilities. Cyprus transposed the EAA into national law through the Accessibility of Products and Services Law of 2024 (the “Law”), which came into force on 28 June 2025. This development has important consequences for services providers, including, financial service providers operating in Cyprus.

Legal Background

The Law applies to both products and services offered within the EU, aiming to remove barriers for persons with disabilities. It defines “persons with disabilities” as those with long-term physical, mental, intellectual or sensory impairments that may hinder their participation in society on an equal basis with others.

Applicability to Financial Services Providers

From 28 June 2025 onwards the Law applies to services, inter alia, consumer banking services, which include services that are covered under MiFID II Directive (2014/65/EU), such as the reception and transmission of orders, execution of orders, portfolio management, and investment advice.

Key Obligations

• Accessible Information: Documents that contain information such as financial documents, contracts, statements, policies, onboarding forms, must be perceivable through visual, auditory, and alternative formats and be compatible with assistive technologies.
• Accessible Digital Services: Websites and mobile applications must be fully usable by persons with disabilities. This includes being of adequate font size, contrast, spacing, and provide support for alternative text and assistive technologies.
• Accessible Support Services: Customer support must offer accessible communication modes and inform users about the compatibility with assistive technologies.
• User-Friendly Security Features: Authentication and identification procedures must be operable and understandable. Complexity should not exceed B2 level of the Council of Europe’s Common European Framework of Reference for Languages.

Exemptions

• Microenterprises (fewer than 10 employees and turnover or balance sheet under €2 million).
• Obligations may be waived if they impose disproportionate burden or fundamentally change the service provided.

Transitional Period

• Existing contracts and/or services (offered before 28 June 2025) to continue until 28 June 2030.
• New services introduced after 28 June 2025 must comply immediately.

Penalties

• Administrative Fines: up to €10,000 initially; up to €20,000 for repeated offences.
• Criminal penalties: up to 2 years’ imprisonment or a €20,000 fine; up to 3 years’ imprisonment or a €30,000 for repeated offences.

For more information please contact Christos Chiotis (christos.chiotis@demetriades.com) or your usual contact at Chrysses Demetriades & Co LLC.

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The Council of Ministers will be finally introducing the much talked about Foreign Direct Investments (“FDI”) Bill to Parliament for approval, aiming to screen foreign investments that may pose risks to national security or public order in compliance with EU Legislation.

Scope of the new mechanism

The proposed law applies to foreign direct investments in enterprises operating in strategic sectors, such as:

• Energy
• Transport and communications
• Health and biotechnology
• Defence and national security
• Financial services
• Digital infrastructure and dual-use technologies

When does an Obligation to notify arise?

A notification obligation will arise when a Foreign Investor acquires at least 25% of the share capital of a strategic enterprise, or increases an existing shareholding to or beyond 50%.

Who is considered a Foreign Investor?

The definition of “foreign investor” includes both:

• Natural or legal persons based outside the EU/EEA/Switzerland, and
• EU-based entities that are 25% or more owned or controlled by third-country investors.

This ensures that indirect or structured investments via EU jurisdictions remain within the scope of the law, closing potential loopholes.

Review process and oversight

The Ministry of Finance will serve as the competent authority, responsible for receiving notifications and conducting risk assessments. It will have the legal authority to:

• Approve the investment;
• Prohibit it, if risks are identified; or
• Unwind a completed transaction in exceptional cases.

Limited exemptions

The mechanism includes certain exemptions to avoid undue interference in routine transactions. Notably, it excludes investment in vessels under construction or subject to sale, except for floating storage and regasification units (FSRUs), which are classified as critical to national energy infrastructure and remain subject to review.

Strategic and legal implications

This development is not a move toward protectionism but a measured step to enhance resilience and ensure Cyprus remains aligned with the EU’s evolving approach to foreign investment governance, in accordance with EU legislation.

What businesses should do

Foreign investors and companies engaged in M&A or strategic partnerships in Cyprus should take early steps to evaluate whether their transactions may fall within the scope of the screening mechanism. This includes reviewing ownership structures, transaction thresholds, and industry classification.

Advance planning is especially important, as transactions cannot proceed without clearance once the law is in force. Timing, documentation, and regulatory coordination will be key factors for successful execution.

How we can assist

At Chrysses Demetriades & Co LLC, we assist clients in navigating complex investment regulations and regulatory approvals. Our team advises on:

• Transaction structuring to ensure compliance;
• Preparation and submission of screening notifications;
• Liaison with the Ministry of Finance and other relevant authorities;
• Strategic risk assessments for multi-jurisdictional investments.

If you are considering an investment in Cyprus that may be affected by the new screening rules, or if you are unsure whether notification is required, our team is ready to assist with practical, business-focused legal guidance.

For further information, please contact Demosthenes Mavrellis at demosthenes.mavrellis@demetriades.com

On 11 April 2025, Cyprus enacted Law 42(I)/2025, officially titled The Prevention and Combating of Violence and Harassment in the Workplace Law of 2025. This legislation marks a significant step in safeguarding individuals from violence and harassment in professional settings, while introducing clear obligations and liabilities for employers and employees alike.

The Law is designed to prevent and address acts of violence and harassment in the workplace, protect individuals who report or witness such incidents and ensure confidentiality in handling cases. It also acknowledges the broader impact of domestic violence, requiring employers to support affected employees where reasonably feasible. The scope of the Law extends to employees, employers, and third parties with professional ties to a workplace. It applies to conduct taking place not only at traditional work premises but also in any setting or context linked to professional duties — including work-related travel, training, social events, or even digital communication.

Crucially, both violence and harassment are now classified as criminal offences. “Violence” includes actions or behaviours — even single incidents — that can cause physical, psychological, sexual, or economic harm. “Harassment” refers to unwelcome behaviour that undermines a person’s dignity or creates a hostile work environment. Anyone found guilty of committing or inciting such acts may face up to three years in prison, fines up to €10,000, or both. Obstructing a complaint or retaliating against the complainant is also punishable by law.

Legal persons (companies and other organisations) may also be held criminally liable for offences committed by individuals acting on their behalf or due to failures in supervision. Penalties for legal entities can reach up to €20,000, without affecting the liability of the individuals involved.

Employers have a central role in enforcing the Law. They must actively prevent workplace violence and harassment by adopting appropriate policies and procedures, ensuring complaints are handled fairly, confidentially, and without reprisal. Employers are required to draft a code of conduct, in consultation with employee representatives, clearly defining unacceptable behaviours and outlining complaint procedures. They must also designate trained personnel to handle such matters and ensure regular communication and training for staff.

Employees are protected against any adverse action — including dismissal or changes to working conditions — arising from the filing of a complaint or participation in related proceedings. These protections also apply to those who support or testify in such cases.

Complaints may be submitted to Labour Ministry inspectors or the Commissioner for Administration and the Protection of Human Rights (Ombudsman), who are tasked with enforcing the Law. All actions taken under the Law must comply with relevant data protection rules, particularly the GDPR.

Keywords: code of conduct, employee rights, employer obligations

For more information please speak with Thomas Christodoulou or your usual contact at Chrysses Demetriades & Co LLC.

On 29 May 2025, the House of Representatives passed the Investment Funds Administrators Law, L.101(I)/2025, marking a pivotal advancement in Cyprus’s financial regulatory regime. Published in the Official Gazette on 18 June 2025, the Law introduces a standalone legal framework for the regulation and supervision of fund administrators—a sector previously operating under the broader umbrella of fund manager legislation.

This legislative development establishes a distinct regime tailored to the operations of fund administration companies, bringing Cyprus into closer alignment with leading EU and global jurisdictions. For the first time, investment fund administrators are subject to direct licensing and supervision by the Cyprus Securities and Exchange Commission (CySEC), ensuring a higher level of regulatory consistency and oversight.

Under the Law, fund administrators are required to maintain minimum capital reserves—€50,000, or €125,000 where additional services are provided—carry professional indemnity insurance, and operate from a registered and central office located in Cyprus. Governance standards are enhanced through obligations relating to board structure, internal controls, and risk management. In addition, the Law imposes robust compliance, reporting, and anti-money laundering obligations, reflecting a clear commitment to operational integrity and investor protection.

The scope of permitted activities includes core administrative services such as maintaining investor registers, calculating net asset values, and processing investor transactions for both UCITS and Alternative Investment Funds. While these functions were previously referenced under existing legislation and EU directives, they are now unified within a coherent and purpose-built legal structure.

Investor confidence is further safeguarded through provisions addressing conflicts of interest, mandatory disclosure requirements, and reinforced governance mechanisms. CySEC is granted broad enforcement powers to ensure adherence, including the imposition of sanctions where necessary.

The enactment of this Law significantly enhances the regulatory clarity and professionalism of Cyprus’s fund services sector. By setting a defined operational and supervisory framework, the Law strengthens the jurisdiction’s credibility and appeal to international asset managers seeking a stable and transparent European base. It represents a strategic step forward in Cyprus’s ongoing effort to modernise its financial services landscape and support sustainable growth in the investment funds industry.

For more information, please contact Demosthenes Mavrellis (demosthenes.mavrellis@demetriades.com) or your usual contact at Chrysses Demetriades & Co LLC.

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Cyprus has entered a pivotal phase in environmental protection with the adoption of the Nineteenth Amendment to its Constitution in 2024. This landmark reform explicitly enshrines the right to a safe and sustainable environment, shifting from implied constitutional protections to a direct legal mandate.

In an article published in the e-newspaper of the Great Britain – Cyprus Business Association (GB-CY), our partner Katia Kakoulli explores how the amendment enhances access to justice, broadens legal standing, and imposes clearer obligations on the state, fundamentally reshaping environmental litigation in Cyprus. The piece also examines the historical legal context and the practical implications for individuals, businesses, and advocacy groups navigating this strengthened legal landscape.

Read the full article here: 

https://www.gbcy.business/_files/ugd/54fdf4_3ac1e447d5dd469fa8de863a34110a94.pdf

For more information please speak with Katia Kakoulli or your usual contact at Chrysses Demetriades & Co LLC.

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The global energy transition is well underway, and renewable energy is at the heart of this shift. As the world moves towards decarbonisation, the financing landscape for Renewable Energy Sources (RES) projects and acquisitions is becoming increasingly sophisticated. With many government subsidies gradually being phased out, investors and lenders must now navigate complex financial structures to bring clean energy projects to life. Understanding the legal and financial frameworks that underpin renewable energy investments is critical to ensuring project success and long-term profitability.

At Chrysses Demetriades & Co LLC, we specialise in renewable energy law, offering comprehensive legal support to clients investing in and financing solar, wind, and other clean energy projects. Our expertise includes project finance, mergers and acquisitions (M&A), regulatory compliance, and due diligence—helping clients mitigate risks and unlock opportunities in this dynamic and rapidly evolving sector.

RES Project financing: A shifting landscape

Financing RES projects typically involves a mix of equity and debt financing, sourced from:

• Government and transnational institutions (e.g., EU funding for green infrastructure projects).
• Traditional financial institutions (banks and investment funds).
• Alternative sources (private equity and institutional investors focused on sustainable investments).

Historically, the RES sector benefitted from subsidies and feed-in tariffs that spurred early development. While such incentives have largely tapered off for new projects, legacy agreements—such as those with the Renewable Energy Sources and Energy Conservation Fund—continue to provide long-term revenue stability for earlier investments.

Today, the viability and bankability of renewable projects hinge less on the sponsor’s financial strength and more on project-specific fundamentals, including:

• Predictable cash flows,
• Long-term Power Purchase Agreements (PPAs),
• Regulatory clarity, and
• Secure permitting and land tenure.

Still, sponsors may be asked to provide additional security (e.g., corporate guarantees or asset pledges) to strengthen the creditworthiness of the financing package.

Key considerations for Lenders and Investors in RES projects

When structuring RES project financing, lenders seek strong security over assets and income streams. Common measures include:

• Mortgages on land used for solar or wind installations (freehold or long-term lease).
• Assignment of receivables from PPAs with licensed suppliers or the Electricity Authority of Cyprus (EAC).
• Insurance coverage tailored to RES related risks (e.g., weather variability, equipment failure).
• Fixed and floating charges over project assets and revenues.
• Share pledges over the project company to facilitate enforcement in case of default.

While cross-border financing agreements may be governed by international standards (often English law), local security documents remain subject to Cyprus law, requiring precise legal structuring to ensure enforceability.

How we help: Our firm advises on structuring renewable energy financing, aligning with both lender expectations and local legal requirements, while safeguarding our clients’ strategic and commercial objectives.

RES M&A: The importance of Due Diligence

As investor appetite grows for operational and development-stage renewable assets, thorough due diligence remains essential to assessing risks, validating investment assumptions, and ensuring regulatory compliance.

Key workstreams in RES M&A Due Diligence:

• Legal: Project company structure, licensing status, and contractual rights.
• Technical: Performance metrics, grid connection viability, and technology risk.
• Financial: Revenue projections, cost assumptions, and debt servicing ability.
• Business: Market dynamics and offtake competitiveness.
• Real Estate: Land use rights, lease terms, zoning, and environmental constraints.

Critical legal considerations in RES transactions

🔹 Ownership & corporate structure
Ensuring the correct legal ownership of shares and project assets is vital—especially when renewables projects are structured via special purpose vehicles (SPVs).

🔹 Licensing & regulatory compliance
Renewable energy projects require multiple licenses (generation, environmental, construction, etc.). Any gaps or non-compliance can delay commissioning or trigger penalties.

🔹 Land tenure & Real Estate rights
Solar and wind installations often span large land areas. Legal review must confirm secure, long-term rights to use land—without encumbrances that could threaten project financing.

🔹 Power Purchase Agreements (PPAs)
PPAs are foundational to revenue certainty in renewables. Given that Cyprus currently operates a transitional electricity market, PPAs remain essential for selling energy under bilateral terms. Where PPAs are not yet in place, acquirers must either condition their investment on agreement execution or ensure bankable alternatives exist.

Material contracts & Change of Control restrictions

Investors and buyers must review:

• Engineering, Procurement & Construction (EPC) and Operations & Maintenance (O&M) agreements.
• Service contracts that may carry ongoing obligations.
• Change of control provisions requiring consent from third parties before the project can be transferred or acquired.

How we help: We support clients through the entire acquisition process—conducting detailed due diligence, negotiating transaction documents, and structuring deals to minimise risk and maximise return.

Looking ahead: Opportunities in the RES market

The renewable energy sector presents compelling opportunities for investors and lenders aligned with sustainability goals. Success, however, requires a deep understanding of the legal and financial ecosystem in which these projects operate. Whether you’re financing a new solar park, acquiring a wind farm, or negotiating a long-term PPA, expert legal guidance can be the difference between a good project and a great one.

At Chrysses Demetriades & Co LLC, we partner with stakeholders across the renewable energy value chain to provide:

• Tailored legal advice for renewable energy project financing and M&A,
• Expertise in structuring project finance and bankable security packages,
• Comprehensive due diligence and regulatory compliance support, and
• Strategic contract negotiation and risk mitigation for PPAs and energy trading arrangements.

For more information, please contact Chrysses Demetriades or your usual contact at Chrysses Demetriades & Co LLC.

In a landmark ruling, the Court of Justice of the European Union (CJEU) has clarified the position of third-country economic operators—those outside the EU and lacking specific trade agreements—regarding participation and equal treatment in EU public procurement. The Kolin Inşaat Turizm Sanayi ve Ticaret decision (Case C-652/22, EU:C:2024:910) outlines significant restrictions on the rights of these operators to challenge procurement awards, marking a practical setback for claims of non-discrimination in EU tenders.

Key Background on the Decision

The issue arose when Kolin Inşaat, a Turkish firm, participated in an EU procurement procedure governed by Directive 2014/25, which applies to procurement within utility sectors and includes clauses under which third-country operators can be excluded or limited based on the presence (or absence) of trade agreements. Specifically, Article 43 of this Directive provides access to public procurement only to economic operators from countries with an international agreement with the EU, such as the WTO Government Procurement Agreement (GPA) or a relevant Free Trade Agreement (FTA). Turkey, however, does not have such an agreement covering public procurement with the EU. The court’s interpretation underscored that, although EU law does not outright exclude operators from such third countries, it does not extend equal treatment rights to them either.

Ruling Highlights: limited rights for non-EU economic operators

The CJEU’s ruling reinforced that, in the absence of an EU trade agreement, third-country operators do not have the right to demand equal treatment under EU procurement law. While they may be allowed to participate in specific tenders, they cannot invoke rights to non-discriminatory treatment guaranteed by Directive 2014/25 for EU operators or those from countries covered by applicable agreements.

1.     Non-Application of Equal Treatment: The CJEU clarified that third-country economic operators lacking an EU international agreement cannot rely on the EU’s procurement directives for protection from discriminatory practices. Thus, they have no basis to challenge awards on the grounds of equal treatment if their tender is disadvantaged.

2.     Directive limitations: Article 45(1) of Directive 2014/25 entitles “any interested economic operator” to submit tenders; however, this right does not equate to equal treatment in the case of third-country operators not covered by agreements. The court indicated that granting equal treatment in such cases would conflict with the principles set in Article 43 of Directive 2014/25, which reserves these benefits for signatories of relevant EU agreements.

3.     Practical implications for Third-Country bidders: The ruling effectively restricts third-country bidders from challenging procurement decisions based on EU directives if they lack treaty-based rights. This could deter participation by such operators, given the absence of recourse in cases of potential bias.

Conclusion: A pragmatic limitation for Non-EU Bidders

The Kolin Inşaat decision underscores the boundaries of EU procurement rules and reinforces the significance of trade agreements in ensuring access and rights for non-EU companies. Without such agreements, third-country operators face significant limitations, both in terms of participation rights and legal recourse. This decision highlights the critical need for understanding treaty-based rights and the limitations inherent in EU procurement law for third-country operators.

For more information, please contact Katia Kakoulli or your usual contact at Chrysses Demetriades & Co LLC.