Amendment to the Cyprus International Trusts Law

08 March 2012: The majority of the Cyprus House of Representatives voted in favour of the bill introducing amendment to the Cyprus International Trusts Law which remained unaltered since its enforcement, back in 1992. The amendments in the Cyprus International Trusts Law intent to lift legal and practical deficiencies as well as to establish a most attractive, reliable and clear field for International Trusts.

 

This development has been welcomed by the Cyprus legal and business sector since it is a step forward in rendering Cyprus a more competitive trust jurisdiction and it further upgrades Cyprus as an International Economic Centre.

 

Realising that Trusts have the potential of being used as the channel for foreign investments in or through Cyprus, legislature examined the concerns expressed by the investors in order to establish a legal framework that really meets their needs.  Moreover, the recently amended legislation is now harmonised with the European Directives.

 

As a result, the amendments introduced the right of a Cyprus International Trusts holding immovable property in Cyprus and modernised the provisions regarding the residency status of beneficiaries and settlors allowing tax residents to enjoy the benefits of Cyprus International Trusts. Additionally the amendments lead to safeguarding confidentiality and strengthening jurisdictional protection through trustees’ responsibilities, trust duration. Finally, special reference has to be made to the provisions regulating the application of foreign jurisdictional laws.

 

Undoubtedly the amendments will be beneficial not only for foreign investors but also for the reputation of Cyprus as an international centre of financial services. It has to be also considered that Cypriot professionals are well experienced and highly educated in International Trusts Law and the recent amendments gave rise to new challenges to the Cyprus professional world.

Areti Charidemou & Associates LLC Law Firm