CYPRUS AS A REGIONAL GATEWAY

Geography
Government
Political Stability - EU Membership
Judiciary
Infrastructure
Telecommunications
Regional Gateway
Tax Treaties
Cyprus Tax Treaties With Other Countries

Geography

Cyprus, located in the north-eastern corner of the Mediterranean, has an area of roughly two thirds the size of the state of Connecticut or half the area of the country of Belgium.

Cyprus is the third largest island in the Mediterranean after Sicily and Sardinia. The total population is close to 800,000. The capital, Nicosia, has a population of approximately 200,000.

Greek and Turkish are the official languages, however English is widely spoken and is used by the government Courts of law, professional offices and banks

Government

Cyprus is an Independent Presidential Republic. Executive power is exercised by the Council of Ministers whose members are directly appointed by the President.

The highest legislative body is the House of Representatives, consisting of fifty-nine members elected for a five year term of office.

Political Stability - EU Membership

Shortly after its founding in 1960, the Republic of Cyprus went through a period of political unrest as a result of intercommunal conflict between the Greek and Turkish communities, which are the two main ethnic communities on the island.

These events reached a climax in 1974 with a Turkish military intervention. For over three decades, however, the island has enjoyed uninterrupted peace which has encouraged exceptional economic development.

Both the Greek and Turkish communities have declared their determination to reach a peaceful resolution of their dispute.

In April 2003, Cyprus will sign the EU Treaty of accession and will become a full member of the European Union.

Judiciary

The Cypriot legal system is based upon British Common Law. The British Case Law is closely followed and all statutes regulating business matters and procedure are based on British law.

English is widely used in the Cypriot courts.

Infrastructure

The Cyprus economy has a well developed industrial, commercial and service sectors. The country's educational level is very high with a large ratio of university graduates in relation to the size of its population.

Telecommunications

Cyprus offers one of the most efficient telecommunication systems in the world, with the following services:



Fully automatic 24 hour direct dial telephone connection with most countries. All other countries can be reached through the operator;
Telegraph service connection with every part of the world;
International automatic telex and facsimile service;
Datel service for the transmission of computer data both nationally and internationally over the public telephone network;
ISDN and ADSL connections for internet service;
Radiotelegraph and radiotelephone services with ships at sea on a 24 hour basis;
Automatic telex for ships through the Marisat service (maritime service through satellite);
TV transmission and reception on a 24 hour basis available to news agencies and television and radio networks through the Makarios satellite earth station;
International courier service including Datapost operated by the Cyprus Department of Postal Services, DHL, Skypak, and Tradewinds Express, all delivering parcels to Europe and the US within 48 hours from time of collection.

Regional Gateway

The usefulness of Cyprus as a base for international business is the result of its long history and a unique blend of influences.

Elements that have contributed to a native mentality at ease with the different political, economic and business cultures of its region.

Accession to the European Union has anchored Cyprus to the developed world provided an element of political and economic stability to the vibrant business potential of a dynamic region that borders Europe, Russia, Central Asia, the Middle East and even North Africa. A region that over the next twenty years will be the focus of important political and economic change and the recipient of substantial investments.

Cyprus especially after its accession to the European Union is poised to play an important role in this process. The island has historically acted as a gateway to both East and West. It will continue to carry on this traditional role into the 21st Century.

Tax Treaties

Cyprus has a large network of double taxation treaties that includes treaties with Russia and other states of the former Soviet Union. Constructive use of the network of Cyprus treaties has rendered considerable advantages to businesses and individuals who have chosen to establish offshore entities in Cyprus.

Some of these treaties contain provisions which limit their applicability in the case of Cyprus Offshore Companies. However, the restrictions can be minimised, and the advantages offered by these treaties are nevertheless considerable.

Cyprus Tax Treaties Table