International Trusts Law amendments (Republic of Cyprus)
As part of the continuous effort of the members of our firm of keeping you up to date with the applicable legislation concerning your affairs within the realm of our legal services, kindly find herein below for your perusal a summary of latest amendments to the International Trusts Law of the Republic of Cyprus 69(I)/1992:
Law 20(I)/2012 (hereinafter the amending Law) which has come into force since 23/03/2012 stipulates that:
§2 - The Settlor (individual or corporate body) must not be a resident of the Republic of Cyprus for the calendar year prior to the incorporation of the International Trust in question (i.e. the Settlor can be resident thereafter – following incorporation).
- The same principle applies vis-à-vis to Beneficiaries of the International Trust in question.
- A Protector of the International Trust can and may be formally declared as such in the trust settlement / deed.
§4 – Any Creditors of the Settlor have the legal burden of proving in accordance with the laws of the Republic of Cyprus, that any assets transferred by the Settlor to the International Trust may be subject to legal action, only in case of willful misconduct and proven attempt of avoidance of personal liability (presumption of legality for the trust’s affairs).
§5 – The Settlor can maintain a share in the assets of the International Trust following incorporation of the same.
§6 – There is no time bar / limitation for the duration of the International Trust (used to be 100 years).
§8 – there is no limitation as to the place and way of investing the International Trust’s assets, provided the investment is effected in a legally sound and prudent way (i.e. there is no limitation in investing in immovables / land, shares etc in the Republic of Cyprus as well as from now on).
§12 – Beneficiaries of the Trust, who are residents of the republic of Cyprus (as per §2 above) are subject to taxes only in the Republic of Cyprus.
§13 – International Trusts of the Republic of Cyprus that include a choice of applicable law in accordance with Law 69(I)/1992 as amended up to date, cannot be challenged by any other law and the present law is deemed as overriding and binding as a matter of national security / interest.
Thanking you for your fruitful cooperation, we remain available for anything further we may be of assistance.
Alexandros G. Ioannides of
Alexandros G. Ioannides & Associates
Advocates & Legal Consultants