Tag: EU

Stricter rules by Council and Parliament regarding Anti-Money Laundering (AML)

AML: Stricter rules by Council and Parliament

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The Council and Parliament of the EU provisionally agreed upon upgrading several parts of the anti-money laundering package, aiming to protect EU citizens and the EU’s financial system against money laundering and terrorist financing.

Under the new agreement, the rules applicable to the private sector will be transferred to a new regulation, while the organization of AML/CFT combat systems at Member State level will be regulated by a relevant directive.

The provisional agreement on an anti-money laundering regulation will, for the first time, exhaustively harmonise rules throughout the EU.


The updates of the AML package are separated in two main pillars as follows:

1. Anti-money laundering regulation

A. Obliged entities: The list of obliged entities has been expanded to include new bodies which are the crypto-asset service providers (CASPs), traders of luxury goods and professional football clubs and agents. The due diligence and reporting obligations vary depending on the type of entity. Also, obliged entities will need to apply enhanced due diligence measures to occasional transactions and business relationships involving high-risk third countries which could be a threat to the integrity of the EU’s internal market.
B. Enhanced due diligence: Specific enhanced due diligence measures will apply to cross-border correspondent relationships for crypto-asset service providers, while credit and financial institutions will follow more specific and strengthened due diligence measures when assessing high net-worth individuals with large amounts of assets.
C. Cash payments: The EU-wide maximum limit for cash payments is set to €10.000 while member states may use their discretion to impose a lower maximum limit. Moreover, obliged entities should identify and verify the identity of an individual carrying out an occasional transaction in cash between €3.000-€10.000.
D. Beneficial ownership: The rules on beneficial ownership and multi-layered ownership and control structures are clarified, beneficial ownership is based on two components – ownership and control. The beneficial ownership threshold is set at 25% and applies to both EU entities and non-EU entities doing business or buying property in the EU. Registration of the beneficial ownership of all foreign entities that own real estate with retroactivity until 1 January 2014.
E. High-risk third countries: Enhanced due diligence measures will be required for the occasional transactions and business relationships involving high-risk third countries.

2. The 6th Anti-money laundering directive

A. Beneficial ownership registers: The information submitted to the central register should be verified, while sanctioned entities or individuals should be flagged. The entities in charge of the registers are authorized to inspect the premises of the registered legal entities if deemed necessary, while persons of the public with legitimate interest, including press and civil society, may also access the registers. In addition, real estate registers should be accessible to competent authorities through a single access point, to facilitate investigations of criminal cases.
B. Financial intelligence unit (FIU) responsibilities: The FIU of each member state will have immediate and direct access to financial, administrative and law enforcement information and will continue to share information to competent authorities while ensuring that fundamental rights are taken into consideration. Furthermore, the agreement sets out the context in which FIUs will be able to suspend or withhold consent for a transaction under investigation.
C. Supervision: All obliged entities are subject to adequate and effective supervision and suspicious behaviour will be reported to the member state’s FIU. In addition, new supervisory measures will apply to the non-financial sector, by the so-called supervisory colleges, and the new Anti-Money Laundering Authority (AMLA) will prepare draft regulatory technical standards.
D. Risk assessment: The Commission will carry out an EU level evaluation and provide recommendation to member states with regards to the risk assessment they carry out, aiming to effectively mitigate any money laundering and terrorist financing risks.

The legislative proposals are pending approval before being formally adopted and entered into force by the Council and the Parliament. This provisional agreement will carefully align EU rules, minimize possible risks of unlawful activities in the financial system, and strengthen the national AML systems for combating fraudulent and illegal proceeds.

Official source here

IDLAW and Nobel Trust Tax event, 30th November 2023, Nicosia, Cyprus

Recent Developments in EU Tax Law, Taxpayers’ Rights and the Impact on Cyprus

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IOANNIDES DEMETRIOU LLC and Nobel Trust Ltd jointly organised the event titled: “Recent Developments in EU Tax Law, Taxpayers’ Rights and the Impact on Cyprus” on Thursday, 30th November 2023, Nicosia, Cyprus.

The above topics were presented by leading counsel Professor Philip Baker, KC, OBE, Field Court Tax Chambers & the University of Oxford, and Ioannides Demetriou LLC’s collaborating Special Tax Counsel Professor Christiana HJI Panayi, Chair in Tax Law at Queen Mary University of London.

The presentations provided a unique opportunity to be informed of the recent legal developments in relation to the protection of taxpayers’ rights as well as anticipated developments in tax law within the EU.

Recording of the event:

Cyprus ultimate beneficial owners electronic register

Register of Beneficial Owners: Implementation of the final solution of the Electronic System

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The Department of Registrar of Companies and Intellectual Property following its announcement “Notice for registration of details of Beneficial Owners (BOs) in the Register of Beneficial Owners (BO register) and imposition of fines” dated 09/01/2023, has announced the commencement of the application of the final solution of the electronic system of the BO register from November 14, 2023.

The final solution of the electronic system will be implemented in its entirety within 2024 and constitutes of three phases:

Period 1: 14/11/2023 – 31/12/2023

All companies established or registered under the Companies Law, Cap. 113, all European Public Limited Liability Companies and all Partnerships (hereinafter ‘Organizations’) or their officers/partners are invited to enter the system of the final solution and proceed with the updating/re-registering their Beneficial Owners, even if they have already done so in the interim solution system. For re-enrollment purposes, the Beneficial Owners’ data that have already been provided in the interim solution will be shown, in order to see what has been submitted and then re-submit the same. No financial charge will be imposed during the first period. The way to enter the final solution system will be the same as that of the interim solution.

From this period as well as in the following periods, it will be possible to:

  • Exercise due diligence,
  • Obtain an exception to the information disclosure,
  • Request access to the data of minors,
  • Organizations that are listed on a regulated market, which is subject to disclosure requirements under European Union Legislation will be able to declare their exemption,
  • Organizations subject to equivalent international standards that ensure adequate transparency of proprietary information will be able to declare their exemption;
  • The Obliged Entities and the Competent and Supervisory Authorities will be able to carry out an electronic search in the system on their own. Regarding the Obliged Entities, there will be an examination and then acceptance or rejection of their role by Department officials. The online survey of Obliged Entities will be completed by paying the corresponding fee of 3.50 Euros per Organization.

It should be noted that those Organizations which have demonstrated or intended to demonstrate due diligence during the interim solution should do so in the final solution. The same applies to Organizations that will have to declare their exemption from the final solution either because they are listed on a regulated market, which is subject to disclosure requirements under European Union Legislation, or because they are Organizations subject to equivalent international standards that ensure sufficient transparency of ownership information, which should state their exemption  in the final solution.

Period 2: 01/01/2024 – 29/02/2024

Those companies incorporated or registered under the Companies Law, the European Public Limited Liability Companies and Partnerships or their officers/partners, that have not updated/re-registered the data of their Beneficial Owners into the final solution system during Period 1, will be subject to a penalty.

The charge will be applicable from 01/01/2024 until the date of updating/re-registering the Beneficial Owners’ data. After the above Organizations have paid the relevant penalty, they will be able to proceed with registration and/or suspension and/or change without any further penalty that governs the specific actions based on the relevant Directive as amended.

Those companies that have been established or registered under the Companies Law, the European Public Limited Liability Companies and Partnerships or their officers/partners, that have updated/re-registered the Beneficial Owner’s data, will not incur a penalty and will be able to register and/or suspend and/or make changes without any penalty that governs the specific actions based on the aforementioned Directive.

Period 3: from 01/03/2024 onwards

During this period, the following actions will be available:

  • Updating the Register of Beneficial Owners
  • Confirmation of Beneficial Owners
  • Mismatch
  • Electronic search in the Register of Beneficial Owners
  • Request for exemption from disclosure of information
  • Request for access to the data of a minor
  • Calculations of monetary charges where applicable

Our team can provide you with any assistance you might need with regards to the Register of Beneficial Owners. For any clarifications or questions, do not hesitate to contact us.

View original source here.

registration of ultimate beneficial owners Cyprus companies

Registration of beneficial owners data to avoid imposition of fines

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The Department of the Registrar of Companies and Intellectual Property, following its announcement on the Functioning of the Register of Beneficial Owners in the interim solution, and in view of the imminent implementation of the final solution of the electronic system of the Register of Beneficial Owners, which is expected around the end of October 2023, invites all companies incorporated or registered under the Companies Law, Chapter 113, the European public limited liability companies (SE) and Cooperatives as well as their officers/partners, if they have not already done so, to register the details of their beneficial owners in the Register of Beneficial Owners of Companies and other legal entities maintained by the Department, in order to avoid the imposition of a monetary burden and/or the initiation of criminal proceedings due to non-compliance. The deadline is on 30th of September 2023.

In addition, following the start of the final solution, a period of one month will be granted for confirmation and completion of the information that has been registered in the system of the interim solution and will have been transferred to the final system by all entities. During this period, requests for information release exemptions should be filed along with reasons for exercising due diligence.

It is pointed out that, at the end of the one-month period, the automatic imposition of fines through the final solution of the electronic system of the Register of Beneficial Owners for the non-compliant companies will begin.

It is reminded that, regardless of the criminal responsibility or prosecution of any person, in case of non-compliance the company or other legal entity and each of its officials are subject to a fine of two hundred euros (€200) and a further fine of one hundred euros (€100) for each day of continued infringement with a maximum total charge of twenty thousand euros (€20,000).

Our firm has extensive expertise on the matter and would be pleased to assist your organization to meet its compliance requirements.

For further inquiries and assistance, please contact us and we will get back to you.

Income tax law amendments, Cyprus, June 2023

Income Tax Law Amendments

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On 22 June 2023, the House of Representatives passed additional amendments to the Income Tax Law with regards to Article 8(23A).

The Article provides a 50% exemption from income tax on the remuneration of individuals employed in Cyprus, subject to certain criteria. The recent amendments are as follows:

• The exemption will be granted if the individual was not a resident of Cyprus for 15 consecutive years prior to any employment in the Republic. Previously, the exemption was applicable if the individual was not a Cyprus resident for 10 consecutive years.
• The exemption will be granted for a period of 17 years from the date of employment regardless of whether the individual changed employer during this period. Previously, the exemption was only granted for the first employment of the individual in Cyprus.

It is important to note that these amendments also apply to the transitional provisions that were formerly introduced in Article 8(23A) in 2022 and that the individuals that were entitled to the 50% income tax exemption based on the old provisions of Article 8(23A), will continue to claim the exemption, provided that they meet all the requirements.

Article Amendments to the Cyprus Residency Programme

Revised Cyprus Permanent Residency

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Pursuant to the provisions of Regulation 6(2) of the Aliens and Immigration Regulations, the Minister of Interior has decided to revise the current Permanent Residency programme with the new rules coming into force on 02/05/2023.

The revision includes updated restrictions and verification procedures with regards to the granting of an immigration permit.

The recent amendments are as follows:

A.    Investment Criteria

The applicant should make an investment of at least €300,000 in one of the following investment categories:

1.    Investment in a house/apartment: purchase should be from a land development company, which should concern a first sale of at least €300,000 (plus VAT).

2.    Investment in real estate (excluding houses/apartments): purchase of another form of real estate such as offices, shops, hotels or similar developments or a combination of these with a total value of €300,000. The properties in question may also be subject to resale.

3.    Investment in share capital of a Cypriot Company with activities and personnel in Cyprus: Initial investment in the share capital of a new company or increase of the share capital in an existing company registered in the Republic of Cyprus, which is based and operates in the Republic of Cyprus and has a proven physical presence in Cyprus and employs at least five (5) people.

4.    Investment in shares of a Cyprus Investment Organization for Collective Investments (type AIF, AIFLNP, RAIF): Investment in shares of a Cyprus Investment Organization for Collective Investments whose investments should be made in the Republic of Cyprus.

When investing in residential or other properties, the applicant must make a payment into the seller’s account at a Cypriot financial institution and prove that the contract of sale was filed with the Land Registry and provide official receipts of payment, regardless of the date of delivery of the property. It must also be proved that funds come from abroad and are not a product of internal borrowing. In cases where the applicant chooses to invest in a company’s share capital or in shares of an investment organisation, his total income or part of it may also arise from sources originating from activities within the Republic, provided that it is taxable in the Republic.

Additionally, the applicant, should prove that he/she has at his/her disposal a secured annual income of at least €50,000. The annual income is increased by €15,000 for the dependent spouse and €10,000 for each minor child, and dependent adult children up to the age of 25 years.

More specifically, when the applicant invests in a house or apartment, this income can be from salaries, pensions, stock dividends, fixed deposits or rents emanating from abroad, which will only be proven by the tax declarations from the country in which he/she is a tax resident. In calculating the total income, the income of the applicant’s spouse may also be taken into account.

B.    Quality Criteria

1.    Submission of a certificate of a clean criminal record from the country of origin as well as from the country of residence (if different), which should be provided on an annual basis.

2.    Submission of a valid health insurance cover which should be provided annually, if not registered with the national health scheme GHS.

3.    Certification that the applicant and his/her spouse do not intend to work in the Republic with the exception of being employed as Directors in a Company in which they have chosen to invest within the framework of this policy.

4.    In cases where the investment does not concern a Company’s share capital, the applicant and/or his spouse may be shareholders in Companies registered in the Republic and receive dividends. They may also hold the position of director in such companies without remuneration.

5.    Where an applicant chooses to invest in real estate, a company’s share capital or in shares of an investment organisation, he/she should present information about his/her residential place and that of his/her family members in the Republic.

In addition, applicants are required to prove on an annual basis that they continue to hold the investment and that they continue to receive the required annual income for themselves and their dependants.

An Immigration Permit may also be granted to the applicant’s children who are over 18 years old and are not financially dependent on the applicant, considering that an additional investment of €300,000 will be made for each adult child. Besides, each adult child should prove that they have at their disposal a secured annual income of at least €50,000 which is increased by €15,000 for a dependent spouse and by €10,000 for each dependent minor. However, permanent residency is no longer provided to the applicant’s parents and parents in-laws.

The application period takes approximately two months and the Cyprus Permanent Residency is indefinite, provided that the applicant and his/her dependents comply with their annual obligations.

Nobel Trust has a dedicated team of experts specializing in immigration services and can be of assistance in your relocation journey. For further information please contact us at [email protected] or call us at +357 22 022 777.