Doing business in Cyprus

Cyprus is a small island country located in the eastern Mediterranean, and its strategic location has made it a hub for business activities between Europe, Africa, and Asia. With its favorable tax regime, skilled workforce, and modern infrastructure, Cyprus has become a popular destination for businesses looking to expand into new markets.

One of the advantages of doing business in Cyprus is its favorable tax regime. The corporate tax rate is one of the lowest in Europe at 12.5%, and the country has also signed double taxation treaties with more than 60 countries. Cyprus also offers a range of incentives, including tax exemptions and credits, to attract foreign investment.

Cyprus has a highly skilled and educated workforce, with a high percentage of the population proficient in languages such as English, Greek, and Turkish. The country also has a strong culture of entrepreneurship and innovation, with a growing startup scene.

Infrastructure is another advantage of doing business in Cyprus. The country has a modern transportation network, including two international airports and a modern seaport, which make it easy to access markets both domestically and internationally. Cyprus is also investing in renewable energy, with a goal of generating 13% of its electricity from renewable sources by 2020.

However, there are also challenges to doing business in Cyprus. The country's legal and regulatory framework can be complex, particularly for foreign businesses. Corruption is also a concern in some areas of the government and business community.

Overall, Cyprus presents opportunities for businesses looking to expand into new markets. With its favorable tax regime, skilled workforce, and modern infrastructure, the country is positioning itself as an attractive destination for foreign investment and local business growth.


Advantages of Doing Business in Cyprus

✔ Favorable tax regime: Cyprus has a low corporate tax rate of 12.5%, which is one of the lowest in Europe, and offers a range of incentives, including tax exemptions and credits, to attract foreign investment.

✔ Skilled workforce: Cyprus has a highly skilled and educated workforce, with a high percentage of the population proficient in languages such as English, Greek, and Turkish. This can be particularly advantageous for businesses looking to expand into other markets.

✔ Modern infrastructure: Cyprus has a modern transportation network, including two international airports and a modern seaport, which make it easy to access markets both domestically and internationally.

✔ Growing economy: Cyprus has been experiencing steady economic growth in recent years, with opportunities for businesses in a range of sectors, including finance, tourism, and shipping.

✔ Strategic location: Cyprus's location in the eastern Mediterranean makes it a strategic hub for business activities between Europe, Africa, and Asia, which can provide access to a wide range of markets.


Disadvantages of Doing Business in Cyprus

✖ Complex legal and regulatory framework: The legal and regulatory framework in Cyprus can be complex, particularly for foreign businesses. This can create uncertainty and increase the cost of doing business.

✖ Corruption: Corruption remains a concern in some areas of the government and business community, which can create challenges for businesses looking to operate in the country.

✖ Small market size: Cyprus has a relatively small population of around 1.2 million people, which can limit the potential market for businesses operating within the country.

✖ High costs: Cyprus has a high cost of living compared to many other countries in the region, which can make it an expensive location for businesses to operate.

✖ Limited natural resources: Cyprus has limited natural resources, which can make it more dependent on imports and vulnerable to fluctuations in global markets.


There are several types of business organizations in Cyprus, each with its own advantages and disadvantages. Some of the most common types of business organizations in Cyprus include:

► Sole proprietorship: A business owned and operated by one individual who assumes all risks and profits.

► Partnership: A business owned by two or more individuals who share profits and liabilities. Partnerships can be either general partnerships or limited partnerships.

► Limited liability company (LLC): A business structure where owners are not personally responsible for the company's debts or liabilities beyond their investment in the company.

► Public limited company (PLC): A company whose ownership is divided into shares, with shareholders' liability limited to the amount of their investment.

► Branch of a foreign company: A foreign company may establish a branch in Cyprus to conduct business within the country.

► Representative office: A foreign company may establish a representative office in Cyprus for the purpose of conducting market research, promoting the company's products or services, and establishing business contacts.