Legal Notes on Real Estate & Property in
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2.0 CYPRUS IN INTERNATIONAL LAND MARKET
Foreign Investments in immovable property
Price of land
LEGISLATION RELATED TO IMMOVABLE PROPERTY
Double Tax Treaties
BRIEF REFERENCE TO SOME ASPECTS OF LEGISLATION
The Constitution of Cyprus
The Contract Law and the Civil Procedure Law
The Stamp Law
The Wills and Succession Law, The Administration of
Estates Law, the Probates (Re-Sealing) Law and the Estate Duty Law
The Trustees Law
The Exchange Control Restriction Law and the Central
Bank of Cyprus Law.
The Immovable Property (Tenure, Registration and
The Sale of Land (Specific Performance) Law
The Acquisition of Immovable Property (Aliens) Law
The Immovable Property Tax Law and the Immovable
Property (Towns) Tax Law
The Capital Gains Tax Law
The Rent Control Law
FEES FOR LEGAL SERVICES RENDERED
Nowadays the world population is
growing rapidly and so is the demand for land. The need for land is not
limited to the residential sector; it occurs in the agricultural,
industrial, commercial and tourist sectors as well. Land is a finite
material and therefore its value worldwide is constantly increasing.
This increase in value is
aggravated by inflation and by the instability of the monetary systems and
fiscal policies of the countries that lead the race in the financial field,
thus making investment in the safer sector of immovable property more
The great technological progress in communication,
transportation and international trading has made investment in this field
easier and more accessible than in the past.Man's
affinity with the land stems from time immemorial and it is easy to
understand why land has always been considered as one of the most precious
commodities, closely connected with social and economic stability and
progress, and why the various legal systems have always tried to regulate in
detail the rights of possession, occupation and ownership of immovable
Cyprus is no exception to the rule.
The economic and social evolution that has taken place in recent years and
the sophisticated methods of cultivation and industrialization, together
with the absence of alternative forms of investment, have diverted capital
both from home and abroad to land ownership and land transactions.
This trend has necessitated the
establishment of a suitable legal framework whilst allowing the involvement
of Cyprus in the international land market, protects the social, economic,
agricultural and industrial interests of the island and its people.
Cyprus has achieved this task.
Despite its troubled history, it has managed to develop a constructive legal
system for immovable property that is as efficient as similar systems in
other advanced countries. It is operated through a series of laws which are
regularly amended to meet everyday demands and balance conflicting interests
in this vital sector of the economy.
2.0 CYPRUS IN THE
INTERNATIONAL LAND MARKET
investments in immovable property
The location of Cyprus in the
eastern Mediterranean at the crossroads of Europe, Asia and Africa, the safe
and protective legal system, the perfect infrastructure, coupled with
regular communication with all parts of the world, the relatively low cost
of living, its excellent climate and the friendliness and hospitality of its
people, are just some of the reasons that have made Cyprus attractive to
foreign investors for over 20 years now. Foreigners who seek to invest in
immovable property in Cyprus may be classified in the following four main
(a) Retired residents -
These are people who settle
permanently in Cyprus upon retirement. A series of incentives is given by
the Cyprus Government to retired people, including duty-free facilities and
very low taxation of their income which emanates from abroad. These people
may also enjoy, under certain circumstances, the benefits of the Double
Taxation Treaty of their country of origin with Cyprus, if there is one.
Cyprus has signed 26 such treaties, regulating in effect tax relations with
over 40 countries.
(b) Employed residents -
This category includes foreigners
who live indefinitely or for a fixed period of time in Cyprus as employees,
either of their own offshore company or of a local or offshore firm, and who
choose to purchase their own property in Cyprus rather than live in rented
In this category are also included
offshore companies purchasing houses for their Directors.
(c) Holiday Makers - Speculators
These people purchase properties in
Cyprus as holiday homes or for possible permanent places of abode upon
retirement, or for the sale thereof with a reasonable profit at a later
stage. Profits realized by foreigners from
the sale of immovable property may be expatriated under certain
(d) Business investors -
These are foreign individuals and
companies who acquire property in Cyprus for touristic or industrial
purposes, making use of the location and climate of Cyprus, the excellent
infrastructure and the various incentives offered for these purposes,
especially in the area of taxation. To this end, the Free Trade Zone
structure of Cyprus offers great inducements ranging from the provision of
all modern facilities to low tax or tax incentive status.
The relatively small area of Cyprus
and the great demand for immovable property, especially in recent years,
have led to a considerable increase in the cost of land and accommodation in
Cyprus. However, despite the increase, the prices of land and accommodation
in Cyprus, as well as the cost of living, are still comparatively lower than
those of most European countries or holiday resorts.
2.3 Legal assistance
- The complexity of the legislation
on immovable property and the formalities which need to be considered when
dealing in relevant matters render it necessary, especially when foreigners
wish to invest in immovable property in Cyprus, to seek and obtain from the
start reliable and efficient legal advice in order to avoid unpleasant
results and future undesirable consequences.
LEGISLATION RELATED TO IMMOVABLE PROPERTY
Many laws in Cyprus regulate
matters affecting immovable property and transactions related thereto either
directly or indirectly. Such legislation may be divided into two categories,
namely General Legislation and Specific Legislation.
3.1 General Legislation comprises those
laws which, although not regulating matters of immovable property directly,
do contain provisions applicable to rights in immovable property and to
transactions related thereto. The main laws in this category are as follows:
(a) The Constitution of Cyprus
(b) The Contract Law, Cap. 149
(c) The Civil Procedure Law, Cap. 6 and Rules
(d) The Stamp Law, Cap. 228
(e) The Wills and Succession Law, Cap. 195
(f) The Administration of Estates Law, Cap. 189
(g) The Probates (Re-Sealing) Law, Cap. 192
(h) The Estate Duty Law, Cap. 319
(I) The Trustees Law, Cap. 193
(j) The Exchange Control Restriction Law, Cap. 199
(k) The Central Bank of Cyprus Law, No. 48/63
3.2 Specific Legislation includes all
the laws and regulations referring particularly to immovable property and
are as follows:
(a) The Immovable Property (Tenure, Registration and
Valuation) Law, Cap. 224
(b) The Sale of Land (Specific Performance) Law, Cap.
(c ) The Acquisition of Immovable Property (Aliens)
Law, Cap. 109
(d) The Immovable Property Transfer and Mortgage Law,
(e) The Immovable Property Tax Law, Cap. 322
(f) The Immovable Property (Towns) Tax Law, No. 89/62
(g) The Capital Gains Tax Law, No. 52/80
(h) The Rent Control Law, No. 23/83
3.3 Double Tax Treaties
- Cyprus has entered into 26 Double
Tax Treaties, certain provisions of which affect directly or indirectly the
possession, ownership and disposition of immovable property especially in
matters of taxation.
4.0 BRIEF REFERENCE TO SOME ASPECTS OF
LEGISLATION CONCERNING FOREIGN INVESTMENTS
A brief analysis and reference is
attempted herein below on some aspects of the above legislation of Cyprus,
in relation to the protection of ownership and the rights pertaining to
immovable property, the regulation of relevant transactions and the
developed policy in similar matters especially where foreign investments are
4.1 The Constitution of Cyprus
- The Constitution of Cyprus
establishes the equality of all persons irrespective of their nationality
and includes provisions for the protection of human rights of all persons
without discrimination. Any violation by an administrative authority of a
fundamental rights entitles such person to request this authority to remedy
the situation. The administrative authority in this case has a period of 30
days during which it must give a prompt answer to the petitioner.
Furthermore, such person has free
access to any competent Court in Cyprus, as well as the European Court and
Commission on Human Rights.
The right of ownership of immovable
property is considered as one of the fundamental human rights under the
Constitution of Cyprus and as such it is clearly and absolutely protected.
According to section 23 of the Constitution, compulsory acquisition or
imposition of restrictions on immovable property by the Government is
regulated by the Compulsory Acquisition Law, No. 15/62, whereby the
Government may acquire, in the matter of public interest and by giving just
cause, property with payment of immediate compensation to the owner at the
present market value. This law also provides that properties acquired as
above should be returned to their owners if the purpose for which they were
acquired does not materialize within three years from the date of
Therefore foreigners who own
property in Cyprus can also enjoy all those rights pertaining to property
which are available to the citizens of Cyprus and can be assured that their
property is absolutely protected.
4.2 The Contract Law and the Civil Procedure Law
These laws are to a large extent
modeled on their English counterparts and they regulate all kinds of
transactions, including those relating to immovable property and the court
procedures in resolving disputes arising there from. It is advisable that contracts
referring to immovable property be made in writing, duly stamped and
properly signed and witnessed.
All disputes arising from
transactions concerning immovable property are governed by the laws of
Cyprus and are subject to the jurisdiction of the courts of Cyprus. The
parties, however, may in some circumstances agree concurrent jurisdiction of
other courts or refer any dispute to arbitration before resorting to court
4.3 The Stamp Law
- The Stamp Law defines the revenue
stamps payable on contracts in accordance with the purchase price as
(a) For a purchase price up to CY,100.000,
the revenue stamp is CY,1.50
(b) For a purchase price exceeding
the revenue stamp is CY,2.00
on every thousand over CY,100.000.
Thus, the revenue stamp on a
contract for CY,150.000
will be CY,250
for the first CY,100.000
(0.15%) and CY,100
for the remaining CY,50.000
The absence of the revenue stamp
does not render a contract null or void but it cannot be used in Court
proceedings or for the transfer of ownership of property in the Land
Registry. Unstamped contracts may be used as above if properly stamped at
the time of such use, in which case a fine is also imposed according to the
value and the time of execution of the relevant contract.
4.4 The Wills and Succession Law, the Administration of Estates Law, the
Probates (Re-Sealing) Law and the Estate Duty Law.
These laws are modeled on their
English counterparts and they deal with the rights of persons as regards the
disposition of their properties after death and the relevant procedures.
Cypriots cannot dispose by will of
the whole of their estate if they have a spouse or children. The
undisputable portion is one half of the estate if the deceased leaves a
surviving spouse but no children and two thirds if he leaves children.
British subjects, however, are exempt from this rule and they may dispose by
will of the whole of their estate. The law applicable in all respects is the
law of Cyprus.
As to wills made in Cyprus by other
foreigners, the law applicable with regard to the formality of such wills is
the law of Cyprus, i.e. wills should be in writing and attested by two
competent witnesses and they should reflect clearly the free and true wishes
of a sane and competent testator. With regard to the essence and legal
effectiveness of these wills the law applicable is, for provisions referring
to immovable property, the law of the country or countries where such
immovable property is situated (lex rei citae) and for provisions referring
to movable property, the country where the deceased was domiciled at the
time of death (lex domicilii) which may not necessarily be the country of
Wills may be deposited with the
Probate Registrar of the District Court who issues a receipt to this effect,
or may be entrusted for safe custody with lawyers.
It should be noted that upon the
subsequent marriage or divorce of the testator his will should be renewed,
as it will, in most cases, be automatically revoked. Testators should also
seek legal advice if the executor or any beneficiary changes his name or
dies or becomes incompetent to act, or if any property in the estate is
subsequently sold or changes its nature, otherwise his wishes may not take
It is advisable that an executor or
executors be appointed in the will to carry out the wishes of the testator.
Foreigners may set up a trust by
will and bequeath the whole of their estate to appointed trustees to hold
the same in trust for the benefit of certain beneficiaries and to manage and
dispose of it in accordance with the instructions of the testator.
If a person dies intestate or does
not appoint an executor in his will, the court will appoint an administrator
of his estate. If there are heirs under disability the court will appoint at
least two administrators.
The administrator administers the
estate according to the law, pays the debts of the deceased, collects and
distributes the assets amongst the heirs and accounts to the Court. The
surviving spouse inherits in equal shares with the children.
The Probates (Re-Sealing) Law makes
special provisions for persons who die in the United Kingdom or in any
British Dominion or in any country of the British Commonwealth and who, at
the time of their death, also had property in Cyprus. According to this law,
the Grant of Probate or the Grant of Letters of Administration issued by a
competent Court of such country may be re-sealed in Cyprus and an
administrator may be appointed by the Court to administer their estate in
Cyprus. The intended administrator should accompany his relevant application
to the Court for a grant of probate with copies of the Grant of Probate and
will or of the Grant of Letters of Administration, certified as true copies
by the Court issuing the Grant and a power of attorney of the executor/s or
administrator/s appointed by such Court and upon completion of the
administration he should file with the court final accounts of his
administration, accompanied by a declaration of the foreign executor/s or
administrator/s that the administration in Cyprus was carried out to their
The estate duty (inheritance tax)
is calculated on the assessed net market value of the estate at the time of
the death, as follows:
Net Market Value in
There is an exemption of CYP 75.000 for the surviving spouse, CYP 150.000 for each child under 21 and CY,75.000
for each child over 21 years old. Moreover, if the estate includes a house
used by the deceased as his residence, then the value of such house up to
CYP 150.000 is also exempted.
It is to be noted that property
donated by the deceased within three years prior to his death is considered
as A property passing on the death of the deceased@
and the net value thereof is added to the estate of the deceased for
inheritance tax purposes. Property donated by declaration of trust is also
considered as property passing on death and it is also taxed if the
declaration of trust took place within 3 years prior to the death of the
In cases of re-sealings, if the
deceased was domiciled in Cyprus at the time of his death, then the value of
the whole of his estate, both in Cyprus and abroad, is taken into account in
assessing the estate duty. Any inheritance tax paid in the U.K. will be
deducted by operation of the Double Taxation Treaty between Cyprus and the
The Trustees Law
This law is based on its English
counterpart and on the English principles of equity which also form part of
the legal system of Cyprus.
There are currently three forms of
trusts which can be set up in Cyprus, namely:
(a) a Local Trust - The settlor, the trustees and the
beneficiaries are Cypriots and the trust property may include immovable
property in Cyprus.
(b) an Offshore Trust - The settlor and the beneficiaries
must be non-resident in Cyprus. The majority of the trustees, whether
individuals or trust companies (including offshore Cyprus trust companies)
must be Cypriot. The trust must be located in Cyprus so that Cypriot law is
applicable and the Cypriot courts have at least concurrent jurisdiction. The
trust income must be generated from foreign sources, not from business or
other origins in Cyprus, but the trustees may hold immovable property in
Cyprus subject to obtaining the required permit from the Council of
Ministers. The trust deed must be executed in Cyprus.
(c) an International Trust - It is regulated by the
International Trusts Law, No. 69/92, which extended and modernised the
existing legislation on trusts. This law reflects the policy of the
Government to increase the attraction of Cyprus as an offshore jurisdiction,
by offering incentives to foreigners for the establishment of trusts in
Cyprus with certain features which were not available within the existing
domestic law. The law defines an International Trust as being a trust in
respect of which:
(i) the settlor is not a permanent
resident in Cyprus
(ii) no beneficiary (other than a
charity) is a permanent resident in Cyprus
(iii) the trust property does not
include any real property situated in Cyprus
(iv) at all times there is at least
one trustee resident in Cyprus.
A trust will still qualify as an
International Trust even if the settlor, the local trustee or a beneficiary
(or any combination of these) is a Cyprus offshore company or partnership. A
trust which fails to qualify as an International Trust because it does not
comply with one of the requirements of the International Trusts Law falls
within the category of Offshore Trust.
The International Trust is more
popular with non-resident individuals and entities, due to the role which it
plays in international tax planning exercises. This factor, together with
the flexibility, confidentiality and perpetuity and the diverse attractions
of the island, makes international trusts extremely attractive to all
settlors in the business and commercial sector.
For more detailed information, the
reader is referred to our publications on international and other trusts.
4.6 The Exchange Control Restriction Law and the Central Bank of Cyprus Law
The Exchange Control Restriction
Law dates back to colonial times when Cyprus was under British rule and is
connected with the Scheduled Areas created by the British to promote
transactions in sterling. Under this law the expatriation of funds by
Cypriots or foreigners, as well as all money transactions with foreigners,
are subject to the approval of the Central Bank of Cyprus in its capacity as
Foreigners who sell immovable
property in Cyprus may expatriate immediately an amount equal to the sum
brought into Cyprus for the purchase of such property, upon proof that such
amount emanated from external funds. Any profit may be expatriated at a rate
in each subsequent year, plus accrued interest.
In order to encourage foreign
investment in Cyprus, the Government has recently liberalised its policy to
a great degree, allowing participation of foreigners in a great number of
sectors of the economy. The new policy will allow foreigners to acquire a
100% participation in Cypriot companies in all sectors, and will relax the
requirements imposed on Cypriots wishing to participate in investments
Under the new policy the only
criteria foreign investors will have to fulfill are to prove that their new
ventures will not pollute the environment, damage the economy or constitute
a security risk.
An application will have to be
submitted to the Central Bank by a foreigner wishing to invest in Cyprus.
However, the criteria and time taken to process the application will be
reduced to the minimum.
The main advantage of the new
policy is that where the application for foreign participation does not
exceed 49%, the application will be considered by the Central Bank and it
will not be necessary to obtain the opinion of the relevant Government
department. In the case of an application participation exceeding 49% the
Central Bank will have to obtain the opinion of the relevant Government
department, but the examination procedure will be relaxed.
The new policy provides for only a
limited number of saturated activities, which are land development, culture,
education and public utilities. The banking, insurance, financial, printing
and publishing sectors will be subject to a special regime: the Central Bank
will examine applications for foreign participation in these sectors and
will decide on the percentage of participation and its terms and conditions.
More particulars on the new policy
may be found in the relevant circular of the Central Bank of Cyprus,
attached hereto as Annex 2.
4.7 The Immovable Property (Tenure, Registration and Valuation) Law
This law was enacted in 1946,
replacing the Ottoman Land Law prevailing until then. It is considered to be
A to Z of immovable property in Cyprus, dealing with all matters concerning
the tenure, registration, disposition and valuation of immovable property,
within the framework of the Land Registry system of Cyprus, which comprises
all the works and means by which immovable property is technically defined
and drawn, legally recognized, secured and financially valued.
The Land Registry system of Cyprus
is unique, in that by its function the history of each piece of land is
traced back to the date of the General Survey. The rights in land are
defined and secured and all transactions relating to immovable property are
safe and protected.
Cyprus is one of the 4 or 5
countries in the world which maintain such an accurate and effective Land
Registry system. Moreover, with the completion of the computerization of all
its services, it is expected that the services will not only be upgraded but
According to this law
(a) any land;
(b) buildings and other erections, structures or
fixtures affixed to any land or to any building or other erection or
(c ) trees, vines and any other thing whatsoever
planted or growing upon any land and any produce thereof before severance;
(d) springs, wells, water and water rights whether
held together with, or independently, of any land;
(e) privileges, liberties, easements and any other
rights and advantages whatsoever appertaining or reputed to appertain to any
land or to any building or other erection or structure;
(f) an undivided share in any property hereinbefore
includes anything not constituting immovable property.
Section 40 of the law provides that
ownership of immovable property or rights in immovable property can only be
acquired by registration at the Land Registry, through the proper procedure
described in the law and that such registration may only be effected by the
registered owner of the property.
4.8 The Sale of
Land (Specific Performance) Law
Under this law a purchaser of
immovable property may secure the remedy of specific performance, by
depositing a duly stamped copy of the contract with the Land Registry within
2 months from the date of the execution thereof, thus preventing the vendor
from transferring property elsewhere or charging it for as long as the
contract is valid and legally effective.
Acquisition of Immovable Property (Aliens) Law
The word "Aliens"
in this law should not be interpreted in its strict grammatical meaning
(i.e. enemies or extra-terrestrial creatures) but as meaning "foreigners"
The reason for the use of the term "aliens"
goes back to enactment of the law during the last world war when Cyprus was
under British rule; it was used to control the acquisition of immovable
property in Cyprus by enemies or non-British subjects. Similar provisions
appear in all the colonial legislation of Great Britain.
According to this law, foreigners
purchasing immovable property in Cyprus, apart from following the general
rules which regulate such transactions, are also obliged to adhere to
special formalities and are faced with certain restrictions, which are aimed
at the proper control of foreign investments, the protection of foreign
investors, the implementation of the Exchange Control Restriction Law etc.
By law the term
(alien) is defined as any person not being a citizen of the Republic and
includes a local company controlled by non-residents (offshore), a foreign
company and a trust in favour of a foreign person. It does not include:
(a) non-resident Cypriots, or
(b) foreigner wives of citizens of
the Republic not living apart from their husbands under a decree of a
in favour of a foreigner"
means any kind of trust of which the beneficiary or one of the existing
beneficiaries is a foreigner and includes any expressed or implied contract
or agreement, written or oral, under which a foreigner will not be the
absolute owner but will have ownership for the benefits of another or where
ownership will be held for his benefit.
The term "acquisition
of immovable property"
(a) A lease of immovable property
for a period exceeding 33 years.
(b) The acquisition of shares in a
company which is duly registered as a legal entity in the Republic or in the
Sovereign Base Areas and which (in either case) has acquired immovable
property in the Republic or the Sovereign Base Areas, taking into account
that if any shares in the company belong mainly to foreigners, the company
is considered as
(c ) The formation of a trust in
favour of a foreigner which involves, wholly or partly, the leasing of
immovable property falling within the provisions of paragraph (a) above or a
shareholding in a company falling within the provisions of paragraph (b)
Under the Acquisition of Immovable
Property (Aliens) Law, no foreigner can acquire immovable property without
the prior permission of the Council of Ministers. Normally permission is
granted to bona fide foreigners to acquire a flat or a house or a piece of
land not exceeding three donums (about 4000 m5)
for the erection of only one house for use as a residence only by the
purchaser and his family.
Members of the family of an
original purchaser may also acquire their own property, provided that they
are completely independent of the purchaser, both financially and
residentially, such as married children having their own family and
business. Permission is granted for personal use, not for letting or
commercial use. This rule is relaxed for offshore companies which are
permitted to acquire business premises, as well as houses or flats as
residences for their members or directors.
British subjects classified as
Residents according to Annex AT"
to the Treaty of the Establishment of the Republic of Cyprus, may freely
trade in land in Cyprus without the permit of the Council of Ministers. This
privilege was granted to some British subjects who were residents at the
time of the establishment of the Republic of Cyprus, it is recorded in their
passports and it is extended to their spouses and descendants.
Although it may take up to 12
months for the Council of Ministers'
permit to be obtained, purchasers are in the meantime entitled to take
occupation of their premises.
After the permit has been granted
and the property is registered in the name of the foreigner, no further
restriction is imposed on him and he may sell or dispose of it by will or
other instrument. Moreover, the legal heir is not required to obtain a
permit in order to have the property registered in his name. Once the
Council of Ministers'
approval has been obtained, an application should be submitted to the
Exchange Officer of the Central Bank of Cyprus who will furnish a
certificate verifying that the purchase consideration was paid in hard
It should be noted that this
certificate is required in the event of a subsequent sale if permission is
sought to extract the proceeds of sale from Cyprus.
A prospective purchaser should
always, before entering into a contract for the purchase of immovable
property, conduct a search at the Land Registry to make sure that the
property to be purchased is free from any encumbrances, charges or burdens.
It should be noted that no such burdens may affect the right of specific
performance after the contract has been deposited with the Land Registry
The transfer of immovable property
can be effected once permission to acquire has been granted and the Central
Bank has certified the import of foreign funds. Transfer fees are payable by
the purchaser on the sale price or under certain circumstances, on the
current market value as follows:
Current Market Value in CYP
Foreigners are now also entitled to
borrow money for the purchase of immovable property upon mortgaging such
property to the Bank from which they borrow the money.
4.10 The Immovable Property Tax Law and the Immovable Property (Towns) Tax
The immovable property tax is
levied on the market value of the property as assessed on the 1st January
1980 and it refers to the immovable property registered in the name of the
tax payer on the 1st January of each year.
The rate of taxation is as follows:
Value of property in CYP
Cumulative tax in CYP
Owners of immovable property are
also subject to minor taxation under other laws, such as municipal or
village rates, sewerage fees and refuse collection charges, ranging from CYP 50 to CYP 100 per annum.
4.11 The Capital Gains Tax Law
As from the 1st August 1980,
Capital Gains Tax is levied at the rate of 20% on gains realised from the
disposition of immovable property, including gains from the disposition of
shares in private companies which own immovable property.
The following categories of
dispositions are exempted from Capital Gains Tax:
(a) Transfers by reason of death.
(b) Donations between relatives up to the third
degree of kindred.
(c ) Donations to limited companies all the
shareholders of which are members, and continue for 5 years after the
donation to be members, of the family of the donor.
(d) Donations from family companies to their
shareholders, but only in cases where the property gifted was originally
acquired by the company also by way of a gift.
(e) Donations to Charitable Institutions or to the
Republic of Cyprus.
(f) Exchanges of immovable properties.
(g) Compulsory acquisitions.
In assessing the gain there must be
deducted from the price received in consideration of the the disposition:
(a) the assessed market value of the property as at
1st August 1980, or
(b) the price paid or the consideration given for the
acquisition of the property, if the property was acquired after 1/8/80.
(c) the subsequent increase of the value of the
property due to inflation, which is calculated in accordance with the Retail
Price Index, issued every month by the Statistics Department.
(d) in sales of agricultural land by farmers, the
first CYP15.000 of the purchase price, provided that the farmer was residing
in the same area at the time of the sale.
(e) in sales of property used as a residence by the
vendor, the first CYP50.000
of the purchase price, provided that he has been using the same as his
residence for at least 10 years prior to the sale.
(f) for all other sales, the first CYP10.000
of the purchase price.
Those deductions are granted only
once, unless they have not been exhausted at the first sale, in which case
any balance would be carried forward.
4.12 The Rent Control Law -
Leasing in Cyprus is governed by
the provisions of the Contract Law, subject to the restrictions introduced
by the Rent Control Law to protect tenants against eviction under certain
circumstances. The provisions of the Rent Control
Law do not cover foreigners renting properties in Cyprus.
Leases exceeding 15 years may be
registered with the Land Registry and registration should be effected within
3 months of the signing of the lease. Registered leases afford the lessee
certain advantages, including the right to trade the lease.
Foreigners may not take a lease of
immovable property for a period exceeding 33 years without the prior
permission of the Council of Ministers, and they are not allowed to let
their premises to Cypriot or foreign tenants.
This mention of some aspects of the
legislation of Cyprus on real estate and property does not, by any means,
exhaust the relevant subjects, neither does it offer reliable information
upon which one may act without professional advice and guidance,
particularly as the laws in question are constantly amended.
The intention was to give a general
picture of the legal framework within which Cyprus has developed its policy
on matters of immovable property, especially where foreign investors are
concerned and the incentives and protection offered to this end.
FEE SCHEDULE FOR LEGAL SERVICES
The following fee structure is in
accordance with the Regulations issued by the Bar Council of Cyprus on
16/1/1985 as amended.
1. HOURLY CHARGE-OUT RATES FOR LAWYERS
In the office CYP 50.00
Out of office CYP 60.00
Out of town CYP
2. CONTRACTS OF SALE
Obtaining instructions CYP
Preparing contracts of sale
(drafting and printing), stamping and lodging same with the District Lands
Office according to purchase price:
Up to CYP10.000
(P corresponds to the purchase price)
3. APPLICATION TO COUNCIL OF MINISTERS
Preparing application to Council of
Ministers with supporting documents and following up: CYP300.00
4. PROCEDURES FOR TRANSFER
Obtaining Central Bank's
Arranging tax clearing CYP50.00
Attending Land Registry to effecting transfer of
5. OTHER AGREEMENTS REFERRING TO
Lease agreements, amending
agreements, cancellations, gift instruments contracting agreements, etc.
As per Contracts of Sale and on
6. DEALINGS WITH CENTRAL BANK
Obtaining Central Bank's
authority for the expatriation of funds CYP100.00
7. POWERS OF ATTORNEY
Simple form CYP50.00
Complex form (depending on time involved) CYP100.00
8. BILLS OF EXCHANGE - BONDS
Up to CYP5.000
Simple form CYP50.00
Wills setting up trust CYP70.00
Complex form, depending on time involved but minimum
10. ADMINISTRATION OF ESTATES
Initial fee CYP250.00
Plus additional charge depending on
value of estate, as follows:
Up to CYP10.000
11. MANAGEMENT OF PROPERTIES
Maintenance, supervision, payment
of rates depending on time involved but minimum annual charge CYP150.00
Written opinion on any matter
related to immovable properties, depending on time involved but minimum
As per Court scales
* The figures above are exclusive of VAT, the rate of
which is currently fixed at 8%.
* Official fees, travel and courier expenses,
photocopying and international telecommunications etc., all charged in
addition to the fees stated above.
* The above fees do not include our fees for the
translation of documents or for any additional services rendered in case of
complexity of the case and which are calculated on an hourly basis.