SEPA – a common vision or a threat to the EU banks?

SEPA (Single Euro Payment Area) is an EU Council initiative for further economic integration of the EU for member states participating in the EU25, EEA (Norway, Iceland and Lichtenstein) and Switzerland. The concept is that citizens of the Euroland will have only one bank account and use that to pay any Euroland bills at the same fee non distinguishing between domestic or crossborder payment.

A Foreign Company may redomicile to Cyprus

Under the Cyprus Company Law Cap 113 an amendment has occurred [with Law 124(I)/2006] which enables a foreign company to transfer its domiciliation (registered office, etc) to Cyprus and continue its corporate operations from Cyprus under the laws of the Republic of Cyprus.

VAT amendments effective as of January 1, 2010

As of 1/1/2010, Cyprus in order to comply with the provisions of the EU Council Directives 2008/8/EC, 2008/9/EC and 2008/117/EC, amended and effected the changes shown below in the Cypriot VAT law.

Controlled Foreign Companies (CFC) rules may contradict the EC law

CFC rules generally provide that the income produced by controlled foreign companies which is subject to a lower tax rate in their country compared to the tax rate applicable to the resident shareholders, or which benefits from a favorable foreign tax treatment, will be allocated, as CFC income.

Cyprus AML Measures

The problem of money laundering is an international one and must be resolved through international assistance and cooperation by all countries. Cyprus has recognized this and developed a comprehensive legal and procedural frame for addressing this issue.