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According to the Ministry of Finance, international creditors' four consecutive positive reviews of Cyprus' rescue program, combined with trust returning to the banking system, contributed to its decision to abolished all domestic controls.

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The Board of Directors of Bank of Cyprus Public Company Ltd decided the release of the nine-month time deposits that were blocked as per the decrees relating to the recapitalisation of the Bank in July 2013 and mature on 30 April 2014.

The Bank has proceeded with the release of the nine-month time deposits as follows:
- one third of nine-month time deposits is immediately released and becomes available in clients' current accounts;
- one third of nine-month time deposits is converted into a three-month time deposit maturing and automatically released at 31 July 2014;
- one third of nine-month time deposits is converted into a six-month time deposit maturing and automatically released at 31 October 2014.

The released funds will be subject to the general restrictive measures currently applicable in the Cypriot banking system.

The Bank’s improving liquidity position and its specific and deliberate actions to enhance its liquidity through deleveraging are the decisive reasons for the release of the deposits. Furthermore, the release of the deposits reflects the Bank’s prudent liquidity management and takes into account the improvement in the economic environment. Through its decision, the Bank’s management recognizes the improving trust and confidence towards the Bank by its customers and meets the expectations of the general public in Cyprus for supporting the recovery of the economy as a whole.

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On the 31/1/2014 the Bank of Cyprus informed its valued clients that the Board of Directors of the Bank has decided to release the above deposits.

The Bank sent a personalized letter to this effect which includes the details of the clients' personal banker, to all interested clients.

Please note that the released deposits are subject to the general restrictive measures currently applicable to all banks in Cyprus. Based on the current restrictive measures, the higher of EUR 5.000 or 20% of the deposit amount may be transferred to a current account. This is also the case for future deposit maturities.

The Decree applicable is as per articles 4 and 5 of the Enforcement of Restrictive Measures on Transactions in case of Emergency Law of 2013 issued by the Ministry of Finance on 30 July 2013.

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1.Laiki Bank

The resolution measures already adopted are:

(a) The sale of Laiki Bank's branches in Greece to Piraeus Bank in Greece

(b) The sale of Laiki Bank's business in Cyprus (excluding the bank's subsidiaries and branches abroad) to the Bank of Cyprus.

As a result of the above, all contracts are transferred to either the Bank of Cyprus or Piraeus Bank.

Moreover, the following points are clarified:

• All insured deposits (individuals and legal entities) up to €100.000 have, as of 26 March 2013, been transferred from Laiki Bank to the Bank of Cyprus. In addition, the entire amount of deposits belonging to financial institutions, the government, municipalities, municipal councils and other public entities, insurance companies, charities, schools, educational institutions, and deposits belonging to JCC Payment Systems Ltd have been transferred to the Bank of Cyprus.
• All other deposits exceeding €100.000 remain in the 'bad' Laiki Bank.
• All loans and credit facilities to Laiki Bank customers are transferred to the Bank of Cyprus, apart from the amount which is attributed to the deposits that remained in the 'bad' Laiki Bank, as mentioned above. In other words, there will be a set off between loans and deposits.

2.Bank of Cyprus

The resolution measures are:

(a) The sale of Bank of Cyprus's branches in Greece to Piraeus Bank in Greece.

(b) Adopting a bail-in rescue plan.

For the purposes of the above measure, if the aggregated deposits a customer (individual or entity) held on 26 March 2013 at the Bank of Cyprus exceed €100.000, then for the amount higher than €100.000 the following apply:

(a) Total loans and credit facilities of the customer on 26 March 2013 at the Bank of Cyprus are deducted from the deposits exceeding €100.000. If the sum of the balances of loans and credit facilities is greater than or equal to the amount of deposits exceeding €100.000, then the resolution measures are not applicable to this client. If the sum of the balances of loans and credit facilities is less than the deposits exceeding €100.000, then the following apply:

(b) 37,5% of this difference is automatically converted into Class A' shares of the Bank of Cyprus, with voting rights and dividends.

(c) 22,5% of this difference is temporarily 'frozen' and possibly part or the whole of it, will be converted into Class A' shares of the Bank of Cyprus with voting rights and dividends for the purposes of the bank's resolution. In that regard, an independent valuer will be appointed for the valuation purposes of the Bank of Cyprus. Not later than 90 days from the completion of the valuation, all or part of that percentage might be converted into shares and the remainder returned to the depositor. To the extent that the 22,5% will be re-deposited, the interest will be calculated retrospectively together with a small increment.

(d) The remaining 40% of the difference is temporarily 'frozen' for liquidity purposes. However, the interest continues to be calculated for this deposit based on the existing interest rate, plus an increment of 10 basis points. This amount will be 'unfrozen' in a short period of time and will not be used for resolution purposes.

The current capital of the Bank of Cyprus (shares, securities convertible into shares, bonds) is converted into new shares as explained below:

The existing ordinary shares are converted into new shares of Class D'.

The existing securities which are convertible into shares are converted into new shares of Class C '.

Existing bonds are converted into new shares of Class B '.

Voting rights and dividends for the above-mentioned new classes of shares (B', C', D') may be exercised only if the total dividends to be given to holders of Class A' shares reach the original contribution plus interest at an annual rate of EURIBOR-3 months plus 10%. Class A' shares have full voting rights and dividends.

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All deposits of less than 100,000 euros will be secured in accordance with the Deposit Protection Scheme of the Cyprus Government ("Protected Deposits").

Laiki (Cyprus Popular) Bank

• Laiki (Cyprus Popular) Bank will be split into "good" and "bad" banks. The good assets will be merged into Bank of Cyprus. The bad assets will be liquidated over the time.
• The Protected Deposits with Laiki (Cyprus Popular) Bank will be frozen until they are transferred to the Bank of Cyprus. The timing for the transfer is yet to be announced. After the transfer, the Protected Deposits will become operative subject to the exchange control restrictions to be imposed by the Central Bank of Cyprus from time to time.
• The deposits exceeding 100,000 euros ("Unprotected Deposits") with Laiki (Cyprus Popular) Bank will remain with that Bank and will be subject to the liquidation.

Bank of Cyprus

• The existing Protected Deposits with Bank of Cyprus and the Protected Deposits transferred to the Bank of Cyprus from Laiki (Cyprus Popular) Bank will be operative subject to the exchange control restrictions imposed by the Central Bank of Cyprus from time to time.
• The Unprotected Deposits with Bank of Cyprus will remain frozen until the recapitalisation of the Bank of Cyprus. The timeframe for the recapitalization is yet to be announced. These deposits will be subject to the 30% to 40% deposit levy on the amounts exceeding 100,000 euro. Other Banks
• No restrictions will apply to the Protected Deposits and Unprotected Deposits with other banks. However, it will not be possible to move the existing Protected Deposits and Unprotected Deposits from Laiki (Cyprus Popular) Bank and Bank of Cyprus to other banks for the time being.

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The 56-seat parliament voted by 36 votes against and 19 abstentions to reject the bill imposing a levy of up to 10% on the country's bank deposits as part of a €10 billion international bail-out.

The proposed one off levy on bank deposits was rejected in order to safeguard the Cyprus financial industry and international depositors that contribute about half of the island's GDP and bank deposits.

A Cyprus government delegation including the Minister of Finance, Minister of Commerce, Energy and Industry and Cyprus bank officials are in Moscow negotiating with the Russian Government and the Russian business community for a financial assistance package involving banking and energy acquisitions.

At the same time the Cyprus authorities intensify their efforts to raise funding from other domestic and international sources.

All the Cypriot banks remain closed today and possibly will remain closed till the end of the week. The banks will also be closed on Monday the 25th March, a bank holiday.

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The European Central Bank, the European Commission and the International Monetary Fund, impose an one-off levy on the deposits as follows: 6.75% on deposits up to €100,000 per account, and 9.9% on deposits over €100,000.

The levy will be imposed on the credit balance of deposits as of Friday,15th March 2013 and applies to all corporate and physical person's accounts, residents or non residents at Cypriot banks and foreign banks operating in the island.

The depositors will be offered shares in the banks and provided that the deposits are kept in the banking institutions for a period of at least two years, the depositors will be given government bonds secured against the potential income received from the exploitation of the natural gas reserves discovered in the Cyprus territorial waters and jointly exploited with US, French and Italian Oil companies.

The banks will be closed for the Monday banking holiday and will remain closed today (19 March) and tomorrow (20 March) pending a decision by parliament to approve the levy. The Parliament is schedule to meet today at 6.00p.m. to discuss the bill. In the meantime negotiations are taking place for improving the conditions.

MEASURES FOR CYPRUS COMPANIES ONLY

There will be an increase on corporate tax from 10% to 12.5% on the taxable income. Gains arising from the disposal of financial instruments as well as dividends received from overseas subsidiaries or branches remain exempt from tax.

There will also be an Increase in the taxation of interest income received from bank deposits and notice accounts from 15% to 20% - 25%.

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Until 2009, Cyprus was included in the Spanish authorities' so-called black list of tax havens.

In 2009 the Spanish authorities removed Cyprus from the black list and progress in the negotiations regarding the double taxation agreement resumed.

The agreement is based on the OECD Model Treaty.

The effective date the agreement shall take effect is likely to be 1 January 2014.

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The deadline for payment of the annual fee is no later than the 30th June of each year.

Penalties for delay in payment:
If the fee is paid within 2 (two) months of the due date a penalty of 10% is imposed which is increased to 30% if the fee is not paid within 5 (five) months of the due date.

Striking off in case of non-payment:
If the fee and applicable penalties for late payment are not paid by 30th November, then the Registrar of Companies shall proceed to strike off the company in accordance with the relevant provisions of the Cyprus Companies Law.

A company which is struck-off may be reinstated within 2 (two) years by the Registrar of Companies upon payment of the amount of €500. In such case the reinstatement will be automatic and the Registrar shall re-enter the company in the Registry.

In case the company is not reinstated within 2 (two) years from the date on which it was struck-off, the Registrar shall again make the relevant entry in the Registry and reinstate the company but the amount payable for this shall be €750.

Furthermore the House of Representatives, voted that all companies which for the year 2012 declared dormant, must pay the sum of €350.00 for the year 2012. The deadline for such payment is the 29th March 2013.

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The Law provides that all companies which provide administration services and directors must be regulated by a regulatory authority in Cyprus. Companies which are owned by lawyers are regulated by the Cyprus Bar Association. Companies owned by auditors re regulated by the Institute of Certified Public Accountants. All other companies which are not owned by lawyers or auditors shall by regulated by the Cyprus Securities and Exchange Commission.

The Regulation of Fiduciary Service Providers Law 2012 was passed on 12 December, 2012 by the Cyprus House of Representatives as part of a broader set of legislative austerity measures aimed at contributing towards fiscal consolidation and at the same time, securing an EU bailout package. .

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for international business, maintaining and empowering the economic and commercial relations of Cyprus with other countries.

The withholding taxes under the Treaty are as follows:

• Dividends: 10%
• Interest: 10%
• Royalties: 10%.

Cypriot tax laws do not withhold tax on dividends and interest paid to non-residents and no tax is withheld when the royalty will be used outside Cyprus. On the other hand, if the royalty will be used in Cyprus, the relevant withholding tax can be eliminated pursuant to the EU Interest and Royalties Directive.

The Treaty will be effective once the respective internal ratification procedures are completed.

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The Treaty was signed in an effort to make the Republic of Cyprus a more attractive jurisdiction for international business, maintaining and empowering the economic and commercial relations of Cyprus with other countries. The details of the Treaty have not been made and it shall be effective once it is signed and the respective internal ratification procedures are completed.

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Provided that the ratification of the Treaty is completed within 2013 it will be in effect from 1 January 2014. Until that time, the old treaty applies which provides for zero withholding tax on dividends, interest and royalties.

The most important provisions of the new treaty are as follows:

1. With respect to the definition of a permanent establishment, Article 5 of the treaty follows the OECD Model. In particular, a building site or construction or installation project or any supervisory activities of such sites or projects constitutes a permanent establishment only if their duration exceeds 12 months.
2. The withholding tax rate on dividend payments made between the two countries will be limited to 5% provided that the beneficial owner holds at least 20% of the capital of the company paying dividends or has invested in the acquisition of shares or other rights of the company paying dividends at least €100,000. In case these conditions are not met, withholding tax is limited to 15%.
3. The withholding tax rate on interest will be 2%.
4. The withholding tax rate on royalties in respect of copyright of scientific work, any patent, trade mark, secret formula, process of information concerning industrial, commercial or scientific experience will be 5%. In all other cases the withholding rate will be 10% (i. e. films etc).
5. Taxing rights with respect to capital gains arising from a disposal of shares ( irrespective if the shares are of a "property rich" company) or any other movable property is granted to the State in which the person making the disposal is tax resident.

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1. Notional deduction of 80% of net profit as an expense(exemption) of the profits from Intellectual Property and of profits from the disposal of the Intellectual Property owned by a Cyprus Company. Profit is calculated after the deduction from income of all direct expenses. Capital used for the acquisition on development of the IP is claimed as tax deduction in the tax year in which the expense is incurred and the four subsequent years.
2. Interest arising from the acquisition of a wholly owned subsidiary, is allowable for tax purposes, provided that the subsidiary owns assets used in the business. When the subsidiary owns assets that are not used in the business, then interest expense corresponding to these assets, will not be tax deductible
3. Where a parent company sets up its subsidiary, the subsidiary is considered as a member of the group for the tax year since its incorporation date. Previously it was regarded as a group member for the whole year of the assessment prior to claiming group relief.
4. For property and equipment acquired during the years 2012-2014 capital allowances may be claimed at the rate of 20%.
5. Contribution to Pension Fund, Provident Fund and other Insurance Funds approved by the Commissioner of Income Tax are deductible when calculating tax income.
6. The purchase of property, equipment and buildings during the years 2012-2014 are tax deductible when calculating deed dividend distribution.
7. When a person taxed in Cyprus imports an aircraft from outside the EU there is no obligation to pay import VAT when importing that aircraft VAT is paid when VAT Returned is filed for the period of importation of that aircraft.
8. The reduced VAT of 5% on the purchase of construction of residential property for permanent establishment/residence of an individual is extended to cover individuals who are not EU citizens.

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1. Cyprus is removed from the Russian Black list of countries.
2. Russian Companies shall benefit from participation exemption on dividend received from Cyprus Companies.

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1. The tax sparing credit clause on individuals deleted. This results to a deduction of tax payable on dividends in Poland which is received from Cyprus Companies.


2. Fees received by Polish individuals acting as directors of Cyprus Companies are assessed on a tax credit method.
3. An information exchange clause was added on the basis of the OECD Model Tax Convention on Income & Capital.
4. There is a reduction of tax on dividends from 10% to 5% or 0%.
5. There is a reduction of tax on interest from 10% to 5%.

Any dividends received and fees of directors received in Poland from a Cyprus Company are taxed in Poland.

The treaty has been ratified by both governments and shall come into force on 1/1/2013.

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• Requirements



The three requirements to establish an international trust were the following:



1. that settlor and beneficiaries were not permanent residents of Cyprus;
2. that at least one of the trustees was a permanent resident of Cyprus; and
3. that the trust property did not include any immovable property situated in Cyprus.



The Amendments abolish point (c) above and provide that the settlor and the beneficiaries may seek to become Cyprus tax residents two years after the year of creation of the trust.



• Validity of a Trust



1. Any issues relating to the validity, interpretation, amendment or administration of an international trust or a disposition to an international trust will be determined by Cyprus Law, regardless of any of any other jurisdiction.
2. Any Cyprus Laws or Laws of other countries relating to inheritance or succession will not affect any transfer or disposition of property or similarly affect the validity of an international trust.
3. In relation to (a) above the Amendment provides that no disposition to an international trust may be challenged on the basis that it contravenes the laws of another jurisdiction. This relates to matters such as forced-heirship laws, mandatory provisions of family law or laws prohibiting or not recognising trusts.
4. The 1992 Law contained no express provisions regulating the law governing the duties and powers of trustees. The Amendments provide that the trustees' fiduciary powers and duties of trustees and the powers and duties of any protectors of the trusts are governed exclusively by Cyprus law.


• Settlor's powers


1. It was unclear in the 1992 Law whether or not a settlor could have reserved any powers to himself after settling the Trust.
2. The 2012 Amendments clarified that a settlor is enabled to reserve powers to himself, retain a beneficial interest in trust fund, or to act as the protector of the international trust without impugning the validity of the trust.
3. The Amendments furthermore provide that the reservation of any powers by the Settlor shall not be deemed or interpreted as "intent to defraud" the Settlor's creditors.


• Duration Period


1. According to the 1992 Law an international trust was valid for a maximum of 100 years from the date on which it came into existence.
2. By the 2012 enactment, an international trust can exist for an indefinite period of time.
3. The indefinite time period of a Trust are also applicable for charitable trusts and non-charitable purpose trusts.


• Trustees' investment powers


1. According to the 1992 Law, a trustee had broad investment powers and could therefore invest the trust funds in any kind of investment wherever the investment was situated. The trustee was expected to exercise the diligence and the prudence which a reasonable person was expected to exercise when he makes investments.
2. By the 2012 Amendments, the trustee's investment powers have been enlarged so that he has the same investment powers as those of an absolute owner and the trustees are explicitly permitted to invest in movable and immovable property in Cyprus and abroad, including shares in Cyprus companies.


• Taxation



(a)Following the 2012 Amendments,



1. (i) Where the beneficiary is a Cyprus tax-resident, any income and profits of an international trust derived or deemed to derive from within or outside Cyprus are subject to all taxes that are applicable in Cyprus;
2. (ii) Where the beneficiary is not a Cyprus tax-resident, only the income and profits of an international trust derived or deemed to derive from sources within Cyprus are subject to all taxes that are applicable in Cyprus, excluding any dividends or interest received from Cyprus sources are not taxable.
3. (iii) Points (i) and (ii) above do not bear any adverse effects enjoyed by a non-Cyprus resident beneficiary of an international trust that had existed prior to the Amendments.


• Effect on already existing Trusts



The 2012 Amendments apply to all international trusts irrespective of the date of their creation and do not prejudice the validity, of any prior valid disposition or transfer.

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dated December 05, 1998 (the "Treaty") while Cyprus had ratified the Protocol in September 2011. The text of the amending Protocol can be accessed below.

The Protocol will come into force on January 01, 2013 whilst some provisions will be effective as of January 01, 2017.

The crucial consequence of the Protocol is that Cyprus has been removed from Russia's blacklist of states and territories. Among other, this will enable Russian companies to benefit from Russia's participation exemption on dividends received from Cypriot companies.

As regards the exchange of information provisions in the Protocol, etc., which have been subject to considerable press coverage, in fact, these do not affect the current legal position in Cyprus which, in any event, is according to "Law 72(I)/2008".

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1. The abolishment of Article 39 whereby notional interest up to 9% was imposed on Cyprus Companies on balances received by directors or shareholders and up to and including their second-degree relatives. A monthly benefit of 9% per year on balances received at the end of each month for individual directors and shareholders and up to and including their second-degree relatives in relation to loan or financial assistance granted by the company was implemented.
2. Salaries shall be tax deductible for corporation tax purposes if the employer contribution to the Social Security Fund, Social Cohesion Fund, Redundancy Fund, Industrial Training Fund, Pension and Provident Fund are paid during the year that they are due.
3. Increase in the rate for dividends income on Special Defence Contribution from 17% to 20%.
4. Dividends paid by one Cyprus Company to another Cyprus Company where both Cyprus Companies are Cyprus Tax residents, after 4 years following the end of the year in which the profit out of which dividends are paid is taxed under Special Defence Contribution.
5. Special Contribution has been imposed on employees in the private sector according to the following bands:

   Gross Monthly Salary	%
   0 - 2,500	0
   2,501 - 3,500	2,5
   3,501 - 4,500	3
   Over 4,501	3,5

   
   

   Half Special Contribution is paid by the employee and half by the employer.

   These contributions are deductible for income tax purposes for both the employer and employee

6. VAT increase from 15% to 17% effective as of 1st March 2012.
7. Persons registered with VAT must issue and keep receipts for a period of 7 years for the supply of goods and services to non-taxable persons in Cyprus.

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(2) Circular 2006/1 issued by the Commissioner of Income Tax in 10 April 2006 exempted from the ambit of the Deemed Dividend Distribution Rules the profits of a Cyprus tax-resident company which are directly attributable to non-Cyprus tax-resident shareholders.

(3) Furthermore, the Circular goes further to exempt from the payment of the Deemed Dividend Distribution Rules the profits that are imputed indirectly to Cyprus tax-resident shareholders of a Cyprus tax-resident company, in so far, as such profits are indirectly apportioned to shareholders who are ultimately non-Cyprus residents.

(4) The effects of paragraphs (2) and (3) above are the following:

1. (a) the profits of a Cyprus tax-resident company which are directly or indirectly imputed to non-Cyprus tax-resident shareholders are exempted from the Deemed Dividend Distribution Rules; and
2. (b) the taxation borne by a Cyprus parent company where the Cyprus subsidiary did not distribute any dividends is now abolished and eliminated.

(5) The above exemptions apply to all years which have not yet been filed or examined by the Commissioner.

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as a financial centre. These Amendments were published in the Official Gazette of the Republic of Cyprus on 31 August 2011, this being the "Effective Date" of the Amendments:

(A). The Income Tax Law amendment:

Effective from the tax year 2011:

1. a new income tax rate has been introduced at the rate of 35% for any income earned above €60,000;
2. the income and pension of the (a) President of the Republic of Cyprus and (b) President of the House of Representatives of the Republic of Cyprus will be taxable;
3. Tax incentives have been introduced effective from 01 January 2012, to attract to Cyprus highly-paid employees and in this respect a 50% exemption will apply to the income of a non-resident person taking up residence in Cyprus, provided that the annual income of the employee exceeds €100.000. This exemption applies for a period of 5 years starting from the first year of employment.

(B). Special Contribution for the Defence Fund

1. The Special Contribution Tax on dividends received has been increased from 15% to 17%. However:
1. if the recipient of the dividend from a Cyprus company is a non resident individual or company, such dividend is exempt from Special Contribution Tax and thus with no affect on non residents who are recipients of dividend from Cyprus companies;
2. The exception in paragraph (i) above, effectively, applies equally when the relevant corporate structure involves Cyprus companies where the ultimate owner is a non resident of Cyprus.
2. Special Contribution Tax on interest income has been increased from 10% to 15%. However:
1. Where the interest received by a company is in its ordinary course of business or closely related to its ordinary course of business, the company is not liable to Special Contribution Tax on such interest but is liable to income tax at the normal corporate rate of 10%;
2. Where the applicable tax is income tax as described in paragraph (i) above, the tax is levied on the net interest after deducting all relevant expenses. Where the interest is not received in the ordinary course of business and the company is liable to the 15% Special Contribution Tax, this tax is levied on the gross interest received;

(C). Companies Law Amendment

The Companies Law, Cap. 113 introduced a new section 391 which reads as follows:

1. As from 2011 an annual fixed duty of €350 is levied on all companies (except those that are dormant or own no assets) payable to the Registrar of Companies, noting that for groups of companies the total levy is in total €20,000.
2. The duty for 2011 is payable by 31 December 2011 and thereafter by 30 June.
3. Failure to pay the duty by the due date incurs the following consequences:
1. 10% penalty if duty is paid within two months from the due date;
2. 30% penalty if duty is paid within five months from the due date;
3. if duty is not paid within five months, the Registrar of Companies may remove the offending company from the registry, noting that there are procedures embedded in the law for reinstating such a company on the registry.

(D). Value Added Tax Law (VAT)

The following changes were introduced relating to VAT:

(1) Individuals who where entitled to governmental funding of approximately €17,000, provided they purchasing and/or constructing a house or flat as their primary and permanent place of residence, now are also entitled to a reduction of the VAT rate to 5%.

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1. Affixing Of The Common Seal
   The announcement of the signing of this amendment specifies that it modifies the existing double taxation avoidance agreement so as to align it with the current OECD standard, providing greater transparency
   1. The need of affixing the common seal on documents has been abolished.
   2. However, where a company opts to affix its common seal on any document, it should be done in accordance with the relevant procedure set out in its articles of association.


2. Prospectus
1. The filing of a prospectus with the Registrar of Companies by companies is no longer required, where there are offerings of shares or debentures to which the Public Offer and Prospectus Law of 2005 implementing Directive 2003/71/EC and/or the Open-Ended Undertakings for Collective Investment in Transferable Securities and Related Issues Law of 2004 Law apply.
2. Where a prospectus needs to be filed with the Registrar of Companies by a public company which is offering shares or other securities in a market abroad, the filing of such prospectus and accompanying documents can be accepted by the Registrar of Companies in any commonly used language.


3. Unlawful Financial Assistance The provision of direct or indirect financial assistance by a private company for acquisition of its own shares or of the shares of its holding company is no longer unlawful in the following cases:
   1. Where the private company is not a subsidiary of any public company, and
   2. Where the transaction is approved by the general meeting of the company by a resolution passed by a majority of 90% of all the issued shares of the company.
   It is important to highlight that the general prohibition for the provision of financial assistance by a public company for acquisition of its own shares still exists.


4. Redeemable Preference Shares ("RPS") RPS are now issued on terms that allow their redemption both at the option of the company and at the option of the holder thereof.


5. Conversion Of Articles Of Association
   The articles of association of a company can provide for the automatic conversion of the rights attached to shares on the happening of a specific event without the need of taking any actions at the time of conversion.


6. Amendment to Charges
   In case of an amendment, assignment or other change to a charge which has been filed with the Registrar of Companies, it is now possible to also register such change without the need to register such change as a new charge which applied under the legislation prior to the amendment.


7. Abolition Of Registration Requirements For Certain Charges
   The need to register with the Registrar of Companies of certain charges has been abolished:
   
   1. there is no need to register with the Registrar of Companies pledges over shares in Cypriot companies created by pledgors which are Cypriot companies noting that
   1. this does not dispense with the other perfection requirements for a pledge over shares in a Cypriot company and
   2. in any event, where the pledgor is not a Cypriot company there is no need of registration of a charge with the Registrar of Companies.
   2. There is no need to register with the Registrar of Companies charges which come within the Cyprus legislation adopting the EU Financial Collateral Directive.


8. Public Companies Listed On A Market Outside Cyprus
   The amendments abolish practical issues which arose in cases of a public company the shares of which are listed on a market outside Cyprus and particularly the problem which existed resulting from the need to maintain a physical register of members in Cyprus:
   
   1. The registration of a transfer of shares or other securities is legal even in the absence of an instrument of transfer provided, however, that such transfer has taken place in accordance with the rules regulating the relevant market.
   2. In cases of companies which carry on business outside Cyprus, or the shares of which are listed on a market outside of Cyprus or that have shareholders who reside outside Cyprus, one can keep a register of members outside Cyprus provided copies of all entries therein are sent to the registered office of the company. It is clarified that in such cases the register of members should be kept in the place where the business is carried out or where the market is situated or where the members reside.
   3. In cases of companies the shares of which are listed on a market outside Cyprus, the obligation to keep a register of members is satisfied if the companies maintain their registers of members in accordance with the rules regulating such market which, in effect, allows for electronic registers and dematerialized shares and the procedures for perfection of pledges over such shares will be those laid down by the rules of such market.


9. Circulation of Annual Reports
   Section 152 of Cap. 113 relieves a Cyprus public company from the obligation to circulate in hard form before a general meeting the set of financial statements, the directors' report and the auditors' report (the "Documents"). Therefore subject to the length of notice required for the calling of a general meeting, the Documents required to be presented to the company in general meeting now need only to be made available on the company's website or at a place and with a method of distribution that the company so determines.

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in favour of residents of the designated offshore jurisdictions are not completely tax-deductible for the purposes of the Ukrainian tax legislation.

Cyprus is not included in the current list and is similarly excluded from the new list.

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(2)According to a Central Bank of Cyprus press release, "the removal of Cyprus from the list is a positive development and strengthens the reputation and esteem of Cyprus as an international financial centre."

(3)According to a Regulation of the Central Bank of the Russian Federation, which was introduced in 2003, the opening of bank transfer accounts from Russian banks to banks operating in "offshore zones" was subject to various terms, conditions and restrictions. Such a condition, amongst others, was that banks operating in Cyprus had to submit details of their proposed transactions to the Russian Central Bank of any foreign exchange with companies or individuals, as well as any connections between domestic and international banking units.

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