AGP Law, A.G. Paphitis & Co: Cyprus Lawyers, Cyprus Law Firm. https://www.agplaw.com Awarded Cyprus Lawyers & Law Firm | Litigation, Corporate, Regulatory Fri, 15 Mar 2024 10:39:18 +0000 en-US hourly 1 https://wordpress.org/?v=4.9.25 Significant Litigation Success in a High-Profile Shareholders Dispute for AGPLAW https://www.agplaw.com/significant-litigation-success-in-a-high-profile-shareholders-dispute-for-agplaw1/ Thu, 14 Mar 2024 07:40:03 +0000 https://www.agplaw.com/?p=26891 We are pleased to announce a landmark interim injunction victory...

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We are pleased to announce a landmark interim injunction victory in a high-profile case concerning the shareholder structure of a Cyprus company valued at over half a billion USD. This triumph features AGPLAW’s expertise in complex corporate disputes and reinforces our position as a leader in corporate law and disputes. The case involved our clients, holding a majority stake of 58% in the Cyprus company, and the other shareholder holding 42%. Despite a Shareholders Agreement (“SHA”) under UK law, including provisions for share transfers within a group without triggering pre-emption rights, a critical gap in the adherence process rendered the deed invalid under the Law of Property (Miscellaneous Provisions) Act 1989. Consequently, the 42% shareholder’s transfer was deemed illegal due to the deed of adherence’s failure to meet specific statutory requirements for witnessing and attestation. Represented by managing partner Angelos Paphitis, partner Maria Constantinou and Elias Economou senior associate, our team argued that due to the deed’s invalidity, the Cyprus courts held jurisdiction to rectify the shareholders register of the Cyprus company, despite the SHA stipulating dispute resolution under LCIA rules. This strategic legal plan was decisive, as it acknowledged that while the LCIA could adjudicate on the dispute, it could not directly effect changes to the Cypriot company’s register, thus necessitating the intervention of the Cyprus courts. Simultaneously with the legal action, we applied and successfully obtained an ex-parte interim injunction. The Cyprus court granted the injunction, prohibiting any actions recognizing the defendant as a shareholder and preventing any corporate record alterations until further court directives. This decision is important, preventing unauthorized modifications to the company’s shareholder and director registers, which could have had significant repercussions on the company’s governance and operational integrity.
Understanding the aforementioned Legal Instruments:
  • Rectification of a Cyprus Company’s Members Register: This process involves correcting the company’s official records, usually to address inaccuracies or unauthorized changes in shareholder or director registers.
  • Ex-parte Interim Injunction: An ex-parte interim injunction is a temporary court order issued without notifying the other party. It is often used in urgent cases to prevent immediate harm or injustice until a full hearing can be conducted. This powerful legal tool ensures that the status quo is maintained, preventing potential damage or unfair advantage resulting from the disputed actions.
This case highlights the critical importance of adhering to legal formalities in shareholding arrangements and the role correcting applying the law and courts in rectifying company records to uphold shareholder rights. The court’s decision not only serves justice but also ensures the stability and integrity of the Cyprus company’s governance structure. At AGPLAW we are proud of this achievement and remain committed to delivering exceptional services for our clients’ interests.
For more details on this case or to learn how AGPLAW can assist in similar matters, please contact:
For all enquiries please contact our team of experts at agp@agplaw.com  The information provided by AGPLAW | A.G. Paphitis & Co. LLC is for general informational purposes only and should not be construed as professional or formal legal advice. You should not act or refrain from acting based on any information provided above without obtaining legal or other professional advice.
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Cyprus | Shareholder Disputes. Understanding the Primary Instigator & Preclude https://www.agplaw.com/cyprus-shareholder-disputes-understanding-the-primary-instigator-preclude1/ Tue, 12 Mar 2024 08:50:10 +0000 https://www.agplaw.com/?p=26864 What are the main reasons for the rise of shareholder...

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What are the main reasons for the rise of shareholder disputes and what are the mechanisms available for shareholder dispute resolution? Conflicts and disagreements are an inherent aspect of any business corporation. Navigating such conflicts and disagreements is an inevitable challenge encountered by companies of all kinds and sizes. Within the field of shareholder dynamics, matters relating to corporate management, profit allocation, authority, and conflicting personal interests frequently fuel tensions. Such discord has the potential to compromise the rights of minority shareholders and pose significant risks to the company’s operational integrity and overarching objectives. Additionally, the limited influence of minority shareholders in the decision-making process can exacerbate tensions, prompting recourse to legal avenues for protection.
Understanding the primary instigator of shareholder disputes is essential in proactively addressing them:
  • In Cyprus, a breach of shareholder agreements is identified as the primary cause of Shareholder disputes. Such agreements serve to govern the venture, rights, and responsibilities of shareholders regarding the company. By delineating aspects such as voting rights, conditions for share sales, decision-making thresholds, and operational parameters for the board of directors, shareholder agreements establish clear guidelines for company operations. Consequently, any failure by shareholders to fulfill their prescribed duties or obligations outlined in such agreements constitutes a breach often resulting in disputes among shareholders.
  • Overseeing and directing the company’s operation often leads to increased shareholder disputes, particularly when multiple individuals are involved in management and control. company opinions on what constitutes the right course of action in specific situations or which factors should be considered when making decisions about the company’s affairs contribute to this conflict. Therefore, disagreements frequently occur among shareholders who hold diverse viewpoints and ideas.
  • It is crucial for shareholders to fulfill and adhere to their fiduciary duties. Failure to carry out these duties, which may impact on other shareholders and put them at a disadvantage compared to others, is likely to lead to shareholder conflicts.
  • Minority shareholders have minimal impact on decision-making due to their limited influence within the company. As a result, they often express concerns about the perceived oppression of certain shareholders in managing companies’ affairs. Cyprus legislation grants minority shareholders the right to seek legal recourse and protection through the legal proceedings in Cyprus Courts.
To preclude disputes, proactive measures are necessary to be taken.
First and foremost, it is imperative to draft clear and precise company documents during the negotiation phase, delineating decision-making authority and constraints. This task becomes markedly more demanding once a dispute emerges. In such instances, shareholders must carefully inspect the company’s constitutional documents, such as the Articles of Association (AOA) or independent shareholder agreements. For instance, in the event of a dispute over a specific breach of duty, the companies AOA may stipulate provisions mandating shareholders to divest their shares at a predetermined valuation under certain circumstances. This leaves minimal chance for contention regarding the divestment of shares by the breaching shareholder. Convening an extraordinary general meeting (EGM) holds equal significance, alongside a comprehensive review of the company’s AOA and shareholder agreements. Shareholders retain the prerogative to petition for an EGM as per section 126 of the Cyprus Companies Law Cap 113. This forum provides a platform to address emerging disputes through discussion. Negotiation serves as a pivotal strategy to preempt the escalation of intricate and high-value shareholder disputes. Well- informed and resolute shareholders can negotiate more favorable outcomes, thus avoiding protracted and costly legal proceedings. Alternatively, mediation and Alternative Dispute Resolution (ADR) mechanisms offer impartial facilitation, fostering consensus and yielding enforceable agreements. By prioritizing proactive measures and leveraging effective dispute resolution mechanisms, shareholders can mitigate conflicts and protect the interests of the company. At AGPLAW, we understand the complexities of shareholder disputes and offer tailored legal advice and support. From proactive negotiation strategies to mediation services and courtroom representation, our team assists clients in navigating disputes effectively and safeguarding their business interests. With our expertise, shareholders can address conflicts promptly and preserve the integrity of their companies. For all enquiries please contact our team of experts at agp@agplaw.com  The information provided by AGPLAW | A.G. Paphitis & Co. LLC is for general informational purposes only and should not be construed as professional or formal legal advice. You should not act or refrain from acting based on any information provided above without obtaining legal or other professional advice.

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Cyprus | Addressing Legal Challenges in the Competitive Business Arena https://www.agplaw.com/cyprus-addressing-legal-challenges-in-the-competitive-business-arena/ Thu, 29 Feb 2024 08:51:15 +0000 https://www.agplaw.com/?p=26792 Companies in Cyprus’s dynamic business environment face a variety of...

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Companies in Cyprus’s dynamic business environment face a variety of legal challenges that have a substantial impact on their day-to-day operations and potential for future expansion. A deep knowledge of corporate law by a legal expert is essential for staying ahead in this environment and empowering company executives to handle complexity with ease. At the core of corporate governance in Cyprus is the Cyprus Companies Law, Cap. 113, tracing its origins to the English Companies Act of 1948. This regulatory framework encompasses critical facets and regulates all the processes of starting, running and closing a company. Also, as a member of the EU, Cyprus complies with European directives and regulations. These directives require Member States to implement more stringent measures to fulfill their obligations. Presently of utmost importance, the Directive (EU) 2015/849 and Directive (EU) 2018/843 have been enforced by the European Parliament and Council in response to the growing attention that anti-money laundering regulations receive both internationally and within the European Union.
Challenges faced by businesses of varying sizes and across different industries:
  1. As per the Companies Law, each company beyond a designated minimum size in relation to turnover, employees or assets is required to choose an auditor who will remain in that capacity from the conclusion of the Annual General Meeting (AGM) until the next one. All businesses need to conduct audits since, even with the small business exemption, the tax authorities demand that tax calculations be validated by audited financial statements. Financial Management and Reporting entails transparent operations and the obligation to share financial information regarding the success of the organization.
  2. In response to increased oversight measures implemented globally, corporate management and control practices have been reinforced in recent years to ensure the management of potential conflicts of interest when executives diverge from the company’s welfare. Upholding robust corporate governance standards involves defining director responsibilities to act in the best interest of the company and its stakeholders. The board of directors is in charge of running and overseeing business entities. As the company’s owners, the shareholders do, however, have some rights over how the business is run, including measuring its worth and progress. They are granted the right to vote in general meetings of the company to decide on and implement development-related measures, as provided by the Companies Law and the articles of association. Specifically, modifications to the company’s articles of association and memorandum, a decrease in share capital, and the company’s winding up require resolutions approved by a 75% majority of shareholders. Companies are generally expected to exhibit a physical presence. To demonstrate the substantial activities of a corporation, proof of economic substance is also necessary. A firm is deemed to be lacking substance if it has little or no independent economic value, no proven economic activity in the nation where it was incorporated, and no supporting documentation.
  3. Complexity of Regulatory Requirements entails adherence to Cyprus Companies Law and regulations set by regulatory bodies and government. Regulatory Compliance requires remaining informed about modifications to the laws and regulations and performing controls and processes of a company in place to ensure that requirements are followed. The Companies Law has undergone recent amendments to enhance the filing and registration procedures with the Registrar of Companies and Official Receiver. These changes aim to improve the regulatory oversight of companies. Notably, stricter penalties for late filings have been introduced to ensure companies fulfill their information obligations.
  4. Preserving Privacy in the digital revolution presents additional challenges since businesses must operate by privacy rules and protect customer information. Specifically, since the European Union implemented the EU General Data Protection Regulation (GDPR) in 2018, companies located in Cyprus have had to deal with additional obligations and obstacles in protecting data privacy. Businesses are required by the rule to take security-related measures that are proportionate with the risks that accompany the data processing operations they conduct. Cyprus, an EU member, has incorporated the GDPR into its national laws, so companies must comply. Businesses must put data protection first to prevent negative financial and reputational effects.
  5. Intellectual property conflicts may bring problems for Cyprus-based businesses. Such as Trademark issues or Patent disputes where it is forbidden for anyone other than the patent holder to sell, manufacture, import, or engage in any other commercial activity involving the patented invention or any product generated through the patented technique after a patent is registered in Cyprus. Since January 2012, Cyprus has enacted a new intellectual property law in an effort to encourage the use of intellectual property. Business owners who fail to protect their intellectual property run the risk of having their firm taken over by a rival if the required steps are not taken. Hence, securing patents, trademarks, copyrights, and other intellectual property both domestically and internationally is necessary.
  6. Compliance with Employment laws puts additional strain on firms. Common law principles serve as the foundation of the legal system in Cyprus, which combines national and EU laws. Legal knowledge is essential for negotiating the complexities of employment contracts and employee rights, as well as for dispute resolution, fair labor practices and workplace safety. The Minimum Wage Law as of January 2023, the Annual Paid Leave Law (8/1967), the Termination of Employment Law (24/1967), and other laws are some of the main sources of employment law in Cyprus.
  7. The growth and development of Cyprus’s economic environment has resulted in an increase in international trade and cross-border transactions, which presents enormous growth potential for companies. However, entering the overseas market also entails several export compliance standards, international trade laws, customs regulations, and cross-border transaction guidelines that are essential for all businesses involved in international trade to avoid risks. Also, businesses must determine whether the products or services being exported require any export license and collaborate with regulatory bodies to obtain the required permissions in the allotted time frames.
Conclusion
In the long run, modern commercial procedures have high standards that can be very demanding. Ensuring that your company has enough documentation and getting legal counsel when needed would save you from putting your company at risk. Comprehending the law thoroughly and being able to adjust to a constantly changing legal environment allows businesses to thrive and stay compliant in Cyprus’s competitive business environment. For all enquiries please contact our team of experts at agp@agplaw.com  The information provided by AGPLAW | A.G. Paphitis & Co. LLC is for general informational purposes only and should not be construed as professional or formal legal advice. You should not act or refrain from acting based on any information provided above without obtaining legal or other professional advice.

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Disputes. Litigation & Arbitration Brochure https://www.agplaw.com/disputes-litigation-arbitration-brochure/ Tue, 27 Feb 2024 09:24:02 +0000 https://www.agplaw.com/?p=26811 Introducing our comprehensive Disputes brochure, the ultimate guide to our...

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Introducing our comprehensive Disputes brochure, the ultimate guide to our expert litigation and arbitration services. Our disputes team will guide you through the complexities of conflict resolution with skill and precision across Cyprus, England & Wales, Bermuda, and Dubai DIFC. Whether you are involved in a civil or corporate dispute, a fraud case, or a commercial matter, or whether you are facing a personal legal matter, we are uniquely equipped to provide you with the legal representation you need. For all enquiries, please contact our team of experts at agp@agplaw.com

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Cyprus Shipping 2024 | New Green Incentives Programme https://www.agplaw.com/cyprus-shipping-2024-new-green-incentives-programme1/ Thu, 22 Feb 2024 13:25:11 +0000 https://www.agplaw.com/?p=26775 The Cyprus Shipping Deputy Ministry recently announced a new ‘Green...

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The Cyprus Shipping Deputy Ministry recently announced a new ‘Green Incentives Programme’, aiming to reward vessels which effectively reduce their greenhouse gas emissions. These measures form part of the general efforts of the Shipping Deputy Ministry – in line also with the European Green Deal – for promoting sustainable shipping practices which will bring the industry one step closer to the green transformation. The European Commission’s Green Deal encompasses a series of policy initiatives aimed at achieving climate neutrality for the European Union by 2050. As from January 2024, shipowners of Cyprus and Community ships will be eligible to receive up to a 30% reduction in annual tonnage tax, for each vessel that shows proactive measures in minimizing their environmental footprint, thereby incentivizing sustainable shipping practices. The benefit of the reduced tonnage tax will be available only to owners of Cyprus and Community ships, if they comply with the following prerequisites of the environmental incentives, as these were stated in the relevant announcement of the Shipping Deputy Ministry:
  • EEXI – ships that have achieved reduction of their Attained Energy Efficiency Existing Ship Index (EEXI) in comparison to the Required EEXI (Regulations 19, 23 and 25 / amended MARPOL ANNEX VI) by more than 10%, will obtain the respective annual tonnage tax reduction of between 5 – 25%.
  • IMO DCS – the environmental incentive relating to the IMO Data Collection System (DCS) applies to ships of 5.000 GT and above with the reported hours underway of 4.380 and above for each year, that comply with Regulation 27 of amended MARPOL ANNEX VI. Ships which demonstrate reduction of the total fuel oil consumption to the total distance travelled, between two consecutive reference periods (year x vs year x-1) of more than 4%, will obtain an annual tonnage tax reduction of between 10 – 20%.
  • CII – the environmental Incentive relates to the Carbon Intensity Index (CII) of the IMO and applies to ships of 5.000 GT and above (Regulation 28 / amended MARPOL ANNEX VI). Ships that achieve an operational carbon intensity of Rating A or Rating B in a year, with declared hours underway of at least 4.380 per year, will obtain an annual tonnage tax reduction of 20% for Rating A or 10% for Rating B.
It should be noted that if during a PSC inspection a vessel is detained for reasons related to environmental deficiencies and/or if a vessel is violating any regulation or Directive of the European Commission as regards the environmental protection or is in a laid-up condition during the calendar year, then it will be rendered non eligible for the environmental incentive. Moreover, according to the Shipping Deputy Ministry’s announcement on the matter, comprehensive and varied actions are necessary on both global and regional scale to meet emissions reduction goals and secure a sustainable future for the industry. This encompasses the use of cleaner fuels, the establishment of the necessary infrastructure, the electrification of ships and the implementation of energy efficiency technologies. A combination of these strategies has the potential to enhance both the commercial and environmental sustainability of the sector, while also incentivising shipowners to invest in sustainable practices. In conclusion, it is evident that the support of sustainable shipping and the environmental responsibility are at the core of the national maritime policy. The new set of measures certainly reflect the commitment of Cyprus to the green transformation of the sector and further reinforce the island’s reputation not only as a pivotal maritime state but also as an advocate for system – wide collaboration to this challenging task of transitioning to a decarbonised shipping industry. For all enquiries please contact our team of experts at agp@agplaw.com  The information provided by AGPLAW | A.G. Paphitis & Co. LLC is for general informational purposes only and should not be construed as professional or formal legal advice. You should not act or refrain from acting based on any information provided above without obtaining legal or other professional advice.

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Important Update | Cyprus Annual Company Levy Abolished https://www.agplaw.com/important-update-cyprus-annual-company-levy-abolished/ Thu, 22 Feb 2024 09:08:13 +0000 https://www.agplaw.com/?p=26756 On Wednesday, 21st of February 2024 the President of the...

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On Wednesday, 21st of February 2024 the President of the Republic of Cyprus Mr. Nikos Christodoulidis announced through a televised message, a raft of government measures aimed at alleviating the current costs. One of the government’s measures is the abolition of the flat €350 annual company levy. The annual fee that is abolished concerns every company registered in the register of the Department of Registrar of Companies and Intellectual Property of Cyprus and was paid since 2011. The abolition of the annual company levy carries one of the biggest costs for the government, since the state collects approximately €40 million every year from the companies. Should you have any questions you may contact us agp@agplaw.com  The information provided by AGPLAW | A.G. Paphitis & Co. LLC is for general informational purposes only and should not be construed as professional or formal legal advice. You should not act or refrain from acting based on any information provided above without obtaining legal or other professional advice.

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Revisions to Cypriot Citizenship by Years of Residence https://www.agplaw.com/revisions-to-cypriot-citizenship-by-years-of-residence/ Wed, 14 Feb 2024 11:56:16 +0000 https://www.agplaw.com/?p=26573 Significant changes were made on the Article 111 of Civil...

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Significant changes were made on the Article 111 of Civil Registry Law of 2002 by the new law 149(1)/2023. On December 19 the law was published in the Official Government Gazette that had added additional requirements that must be met to be able to apply for naturalization.
Key points:
  • Legal and continuous residence in the Republic of Cyprus for the last 12 months on the date of application, the 90-day rule does not apply to the 12 months;
  • During the immediately previous 10 years the applicant must prove not less than 7 years of Legal residence in Cyprus;
  • The applicant must not be absent from the Republic of Cyprus for more than 90 days in a year;
  • The applicant must be of a good character: 1) Clean criminal record; 2) Entry and exit through unrecognized territories, illegally and any threat to public order and safety of the republic of Cyprus are grounds for disqualification; 3) Applicant must not show by deeds or words disrespect and disobedience to the law of the republic; 4) During any war applicant must not work and/or communicate with the enemy by engaging into any business against the Republic; 5) Has not been convicted in the republic or abroad for serious criminal offences that carries penalty of imprisonment of five years or more; 6) No sanction status must be imposed on the applicant; 7) No criminal case is pending against the applicant in the Republic or abroad that is punishable with the offence imprisonment of three years or more; 8) Does not constitute danger to public order and public security of the Republic. Provided that, in the event of his conviction;
  • Knowledge of Greek language B1 and basic elements of modern politics and social reality of the Republic is required;
  • Suitable accommodation, stable and regular financial resources that are sufficient for the maintenance of the applicant and their family members that are defendant on them must be proven for the years.
In addition to the above the applicant must show genuine interest to reside in the Republic of Cyprus. For all enquiries please contact our team of experts at agp@agplaw.com  The information provided by AGPLAW | A.G. Paphitis & Co. LLC is for general informational purposes only and should not be construed as professional or formal legal advice. You should not act or refrain from acting based on any information provided above without obtaining legal or other professional advice. CYLAW 1 CYLAW 2 You may also be interested in: Citizenship for Highly Skilled Foreign Professionals

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The Legal 500 Cyprus Comparative Guide: Restructuring & Insolvency https://www.agplaw.com/the-legal-500-cyprus-comparative-guide-restructuring-insolvency/ Tue, 23 Jan 2024 09:01:51 +0000 https://www.agplaw.com/?p=26549 We are pleased to announce that managing partner Angelos Paphitis...

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View Brochure VIEW BROCHURE

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EU Adopts 12th Package of Sanctions Against Russia https://www.agplaw.com/eu-adopts-12th-package-of-sanctions-against-russia/ Fri, 22 Dec 2023 10:14:40 +0000 https://www.agplaw.com/?p=26507 On December 18, 2023, the European Commission issued the 12th...

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On December 18, 2023, the European Commission issued the 12th package of sanctions imposed by the European Union against Russia, Regulation (EU) 2023/2878 of the Council of December 18, 2023, amending Regulation (EU) No. 833/2014 concerning restrictive measures due to actions by Russia destabilizing the situation in Ukraine. For the relevant publication in the Official Journal of the European Union, please click here. As far as legal services are concerned, an additional provision is introduced within the regulatory framework of the European Union’s Restrictive Measures, which is the introduction of Article 5(i) within the provisions of Regulation (EU) No. 833/2014, which provides the following:
Article 5r
  • Legal persons, entities and bodies established in the Union whose proprietary rights are directly or indirectly owned for more than 40 % by: a) a legal person, entity or body established in Russia; b)  a Russian national; or c) a natural person residing in Russia, shall, as of 1 May 2024, report to the competent authority of the Member State where they are established, within two weeks of the end of each quarter, any transfer of funds exceeding 100 000 EUR out of the Union that they made during that quarter, directly or indirectly, in one or several operations.
  • Notwithstanding the applicable rules concerning reporting, confidentiality and professional secrecy, credit and financial institutions shall, as of 1 July 2024, report to the competent authority of the Member State where they are located, within two weeks of the end of each semester, information on all transfers of funds out of the Union of a cumulative amount, over that semester, exceeding 100 000 EUR that they initiated, directly or indirectly, for the legal persons, entities and bodies referred to in paragraph 1.
  • Member States shall assess the information received in accordance with paragraphs 1 and 2 to identify transactions, entities and business sectors that indicate a serious risk of breaches or circumvention of, or use of funds for purposes incompatible with, this Regulation or Council Regulations (EU) No 269/2014, (EU) No 692/2014 (*) or (EU) 2022/263 (**), or Council Decisions 2014/145/CFSP (***), 2014/386/CFSP (****), 2014/512/CFSP or (CFSP) 2022/266 (*****), and shall regularly inform each other and the Commission of their findings.
  • Based on the information received from the Member States under paragraph 3, the Commission shall review the functioning of the measures provided for in this Article no later than 20 December 2024.

(*) Council Regulation (EU) No 692/2014 of 23 June 2014 concerning restrictive measures in response to the illegal annexation of Crimea and Sevastopol (OJ L 183, 24.6.2014, p. 9). (**) Council Regulation (EU) 2022/263 of 23 February 2022 concerning restrictive measures in response to the illegal recognition, occupation or annexation by the Russian Federation of certain non-government-controlled areas of Ukraine (OJ L 42 I, 23.2.2022, p. 77). (***) Council Decision 2014/145/CFSP of 17 March 2014 concerning restrictive measures in respect of actions undermining or threatening the territorial integrity, sovereignty and independence of Ukraine (OJ L 78, 17.3.2014, p. 16). (****) Council Decision 2014/386/CFSP of 23 June 2014 concerning restrictive measures in response to the illegal annexation of Crimea and Sevastopol (OJ L 183, 24.6.2014, p. 70). (*****) Council Decision (CFSP) 2022/266 of 23 February 2022 concerning restrictive measures in response to the illegal recognition, occupation or annexation by the Russian Federation of certain non-government-controlled areas of Ukraine (OJ L 42 I, 23.2.2022, p. 109).’;
In addition:
  • Ban on Russian nationals to own, control or hold posts in the governing bodies of entities providing crypto-asset wallet, account or custody services – In order to limit the circumvention of the prohibition on the provision of crypto-asset wallet, account or custody services to Russian persons and residents, the 12th EU Russia Sanctions Package includes a ban on Russian nationals or natural persons residing in Russia from owning or controlling, or holding any posts on the governing bodies of, the legal persons, entities or bodies providing such services.
  • Expansion of controlled business services covered under Article 5n -The existing prohibition on the provision of certain services to the Government of Russia or Russian entities (e.g., accounting, auditing, bookkeeping or tax consulting services, business and management consulting or public relations services, advertising services, architectural and engineering services, legal advisory services, IT consultancy, market research and public opinion poll services and technical testing and analysis services) was expanded to prohibit the sale, supply, transfer, export, or provision of software for the management of enterprises and software for industrial design and manufacture used in the areas of architecture, engineering, construction, manufacturing, media, education and entertainment.
  • This new prohibition could have a material impact on the operation of Russian subsidiaries of Western companies’ dependent on ERP and other types of business software. The software items covered by this prohibition are listed in new Annex XXXIX to Regulation (EU) 833/204 as follows: a) enterprise resource planning (ERP), customer relationship management (CRM), business intelligence (BI), supply chain management (SCM), enterprise data warehouse (EDW), computerized maintenance management system (CMMS), project management software, product lifecycle management (PLM), and typical components of the above-mentioned suites, including software for accounting, fleet management, logistics and human resource; and b) building information modelling (BIM), computer aided design (CAD), computer-aided manufacturing (CAM), engineer to order (ETO), and typical components of above-mentioned suites.
  • Wind down of the “partner country” exemption for controlled business services under Article 5n7 – The EU will eliminate, following a six-month wind-down period expiring on 20 June 2024, the exemption for the provision of controlled business services to Russian subsidiaries of companies headquartered in the EU or other partner countries. This means that an authorization from the competent authority will be required to continue to provide controlled business services to Russian subsidiaries of companies headquartered in the EU or other partner countries. The list of partner countries for these purposes currently includes US, Japan, UK, South Korea, Australia, Canada, New Zealand, Norway and Switzerland.
  • Extension of Article 12b divestment licensing grounds – The deadlines for the licensing grounds for the sale, supply, licensing, import or transfer of controlled items and the provision of controlled business services where necessary for the purposes of divestment from Russia have been extended to 30 June 2024, 31 July 2024, or 30 September 2024, depending on the relevant sanction.
  • Ban on Russian diamonds – Inclusion of a new Article 3p to ban the purchase, import, or transfer of diamonds and products, like jewelery and watches, incorporating diamonds originating in or exported from Russia or diamonds of any origin transiting Russia. This is in addition to a ban on imports of Russian diamonds when they are processed (cut and polished) in third countries (such as India) that will be phased in. Measures include a phased import ban (i) on diamonds and jewellery made from Russian diamonds as from 1 January 2024, (ii) on Russian diamonds of certain higher weight processed in third countries as from 1 March 2024 (based on a G7-coordinated traceability mechanism) and (iii) on smaller Russian stones processed in third countries as from 1 September 2024. To implement these measures, new traceability-based evidence will be required from importers.
  • Additional import bans – Import bans on items which generate significant revenues for Russia (listed in a re-issued Annex XXI to Regulation (EU) 833/2014), such as pig iron and spiegeleisen, copper wires, aluminum wires, foil, tubes and pipes. In addition, a new import ban on liquefied propane (LPG) was introduced with a 12-month transitional period.
  • Additional export bans – Banning the sale, supply, transfer and export of additional items which contribute to Russia’s military and technological enhancement (listed in a re-issued Annex VII to Regulation (EU) 833/2014), such as chemicals, lithium batteries, thermostats, as well as motors and servomotors for drones that Russia uses for military production; and certain industrial items (listed in a re-issued Annex XXIII to Regulation (EU) 833/2014), for instance machinery and parts.
In addition, the EU added 29 entities to the list of those directly supporting Russia’s military and industrial complex in its war of aggression against Ukraine (listed in a re-issued Annex IV to Regulation (EU) 833/2014). These entities will be subject to tighter export restrictions concerning dual use items, as well as items which might contribute to the technological enhancement of Russia’s defence and security sector.
  • Expansion of the transit ban – The transit ban that currently applies to dual use items exported from the EU to third countries via the territory of Russia was extended to certain industrial items listed in new Annex XXXVII to Regulation (EU) 833/2014.
  • Additional measures to enforce the oil price cap – In order to further support the implementation of, and compliance with, the price cap mechanism, the EU introduced a strengthened information sharing mechanism requiring businesses to share price information for ancillary costs, such as insurance and freight, upon request throughout the supply chain of Russian oil trade. The EU has also introduced notification rules for the sale of tankers to any third country in order to make more transparent their sale and export, in particular in the case of second-hand carriers that could be used to evade the import ban on Russian crude or petroleum products and the G7 Price Cap.
  • “No Russia” clause – The EU has imposed a requirement on EU exporters to insert contractual clauses prohibiting re-exports to Russia and re-exports for use in Russia of particularly sensitive items, when selling, supplying, transferring or exporting to any third country, with the exception of partner countries in Annex VIII to Regulation (EU) 833/2014. The scope of this clause is currently limited to items used in Russian military systems or critical to the development, production or use of those Russian military systems, as well as aviation items and weapons. The requirement to introduce the “No Russia” export clause also applies retrospectively to all agreements concluded before 19 December 2023, subject to a transition period (i.e., the earlier of 20 December 2024 or their expiry date).
  • Iron and steel – The EU included a new Annex XXXVI to Regulation (EU) 833/2014 to list partner countries which apply a set of restrictive measures on imports of iron and steel from Russia, and a set of import control measures that are substantially equivalent to those of the EU (for now, just limited to Switzerland and Norway). This means that importers are not required to provide evidence of the country of origin of the iron and steel inputs for the processing of products when such products originate in these countries. In addition, the EU has also extended the wind-down periods for the import of specific steel products.
  • Personal use exemption for sanctioned products – The EU introduced exemptions to import restrictions concerning personal use items, such as personal hygiene items, or clothing worn by travelers or contained in their luggage, and for cars that have a diplomatic vehicle registration plate to enter the EU. Additionally, to facilitate the entry into the EU of EU citizens living in Russia, Member States can authorize the entry of their cars provided that they are not for sale and are driven strictly for personal use.
The information provided by AGP Law | A.G. Paphitis & Co. LLC is for general informational purposes only and should not be construed as professional or formal legal advice. You should not act or refrain from acting based on any information provided above without obtaining legal or other professional advice.

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Citizenship for Highly Skilled Foreign Professionals https://www.agplaw.com/citizenship-for-highly-skilled-foreign-professionals/ Mon, 11 Dec 2023 07:07:38 +0000 https://www.agplaw.com/?p=26438 On November 30, the Cyprus Parliament approved important changes on...

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On November 30, the Cyprus Parliament approved important changes on the Article 111 of the Population Register Law of 2002 (141(I)/2002. This is a significant deal for professionals from third countries, as they can now apply for Cypriot citizenship faster-around 3-4 years.
Key requirements:
  • It is essential to lawfully reside in the Republic of Cyprus and continuously for the 12 months preceding the submission of the naturalization application;
  • Knowledge of the Greek language;
  • Clean criminal record;
  • Entry or exit through unrecognized territories, illegally and any threat to public order and the safety of the Republic of Cyprus are grounds for disqualification;
  • Financially self-sufficient – minimum steady income exceeding 2,500 euros;
  • High academic and professional qualifications are vital;
  • The examination process for this application will follow the fast-track route.
Processing of such citizenship applications would take no longer than eight months. For all enquiries please contact our team of experts at agp@agplaw.com  At AGP Law we make sure that your application meets the standards and will have a higher chance of approval. The information provided by AGP Law | A.G. Paphitis & Co. LLC is for general informational purposes only and should not be construed as professional or formal legal advice. You should not act or refrain from acting based on any information provided above without obtaining legal or other professional advice.

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