Cyprus Ministerial Approval
A person who isn't a citizen of the Republic of Cyprus (regardless of whether they are resident or not) is deemed an alien by law. (This includes an alien controlled company, but not an alien of Cypriot origin or an alien spouse of someone who is a citizen of the Republic of Cyprus).
Note: From 1st May 2004, EU members and companies can purchase and invest in property and will be treated as ordinary Cypriots.
Legislation considers acquisition of property as:
Leases exceeding 33 years
Purchase of shares in a company that owns property, if such an purchase means that the company is now controlled by aliens.
The setting up of a trust or any arrangement, connected with the ownership of property that benefits an alien. If property is registered and does not comply with the law then it is invalid.
For general guidance a few points on real estate purchase are given below:
Foreigners can purchase a house for their own use only. For someone who has been in Cyprus a while and who owns a business (for example an offshore company) or who is living in Cyprus, they may be able to acquire a permit to purchase a further house for example a summer house in Larnaca or Ayia Napa.
Foreigners can purchase land for building on, up to three donums (4.000m²). Permits to purchase plots of land outside the development area will often be refused (but not so in the case of a house purchase so situated).
A permit will not be given to a foreigner purchasing a share in property.
A husband and wife can only buy one house together (not one house each).
A permit will not be given for the purchase of a residence by a foreign company unless the house is registered in the name of the company's director and he/she makes the application. Foreign companies can only buy or build offices.
Only a husband and wife can buy a house in joint ownership. In the case of an alien constructing the building, the cost must be paid in foreign currency.
The Government may give a time limit for the transfer or construction of the property when granting a permit to build. This limit can be extended on application (depending on the situation). Usually three years is the maximum but this can also be extended.
To rent property for more than thirty-three years, a foreigner needs the Council of Ministers' agreement.
Permits will be given to foreigners wishing to sell their property and purchase another one.
Foreigners can rent their property for more than 30 days to residents of Cyprus (not for short lettings). However this does not apply to offices.
Purchase or lease contracts of property are valid even in the event of the Council of Ministers rejection of the foreigner's request. Consequently, when buying property it is suggested that any contract includes a clause provision for this eventuality so that a refund or other remedy may be in place in this unlikely event.
You may expect a delay of up to two to three months to obtain a response from the Council of Ministers, provided all paperwork is in order. Generally, foreigners are permitted to acquire premises in Cyprus, provided they have:
I. No criminal record.
II. Sufficient means to support themselves in Cyprus (an income of approximately €25.000 per year per couple is usually acceptable)..
Note: Companies with dubious pasts, questionable ownership, or unclear business structures will not often be successful.
Further information can be found by contacting Andreas Neocleous & Co LLC www.neocleous.com