Global Maritime Jurisdictions: Unveiling Excellence - Cyprus Edition

Cyprus stands out as the largest third-party ship management centre in Europe and ranks among the top five globally. The island's maritime cluster encompasses a comprehensive range of shipping and related activities, supported by a favourable Tonnage Tax System approved by the European Union, which is applicable to ship owners, charterers, and ship managers.

With particular focus and expertise in ship management, chartering, and ship owning activities, Cyprus offers quality professional services to the shipping industry.

The well-structured and organized shipping community in Cyprus benefits from excellent cooperation between the private and public sectors. Cyprus has been a member of the IMO Council since 1987 and maintains a strong presence in international shipping fora such as the ILO and EU. The autonomous Shipping Deputy Ministry further underscores the island's commitment to the maritime sector.

The Cyprus Flag

As the third largest Ship Registry in Europe, it offers simplified registration procedures with no registration and mortgage fees, competitive fees and dues, and no nationality restrictions for seafarers.

Cyprus is a signatory to all major international maritime conventions on safety and pollution prevention, is on the Whitelist of the Paris and Tokyo MOUs, and has achieved the USCG QUALSHIP 21 status, highlighting its commitment to safety and quality.

The Registry provides 24/7 quality service and web-based access, ensuring efficiency and convenience for vessel owners. Strong representation in key shipping centres and over 25 bilateral agreements on merchant shipping further enhance the appeal of the Cyprus flag.

• Strategic Location: positioned at the intersection of Europe, Asia, and Africa, offering a prime location for shipping operations.
• Political and Economic Stability: being a member of the European Union and of the European Monetary Union ensures a secure environment for investment.
• Robust Legal and Regulatory Framework: based on English Common Law, it provides safety and flexibility for maritime operations.
• Advanced Infrastructure: reliable telecommunications, two international airports, and two ports enhance operational efficiency.
• Favourable Tax System: low corporate tax rate of 12.5%, simplified tonnage tax system, extensive double tax treaties with over 60 countries, and multiple tax exemptions including:
• Exemption from tax on gains from the disposal of securities (e.g. shares, bonds)
• No withholding taxes on interest and dividends
• No taxation of capital gains (except for disposal of real estate in Cyprus or shares of a company holding real estate in Cyprus)
• No tax on dividends, interest and rental income of non-domiciled individuals
• 50% exemption on employment income exceeding €100,000 per annum for non-residents taking up employment in Cyprus
• Income tax free band of €19,500
• Global Recognition and Protection: Cyprus-flagged vessels benefit from EU recognition, international agreements, and strong diplomatic support.

Ownership Requirements

Ownership requirements for registering vessels under the Cyprus flag are designed to accommodate a broad range of persons and entities, while ensuring effective control and representation within Cyprus.

These include:

• Cyprus citizens or corporations established in Cyprus.
• EU/EEA Citizens or Corporations registered within the EU/EEA and with an authorized representative in Cyprus.
• Non-EU/EEA Corporations controlled by EU citizens and with an authorized representative in Cyprus.

An authorized representative can be a Cypriot or EU citizen residing in Cyprus, or a corporation / branch established and operating in Cyprus. Control is defined as more than 50% of the shares owned by EU or EEA citizens, or the majority of directors being EU or EEA citizens.

How We Can Assist

Established over 25 years ago, our Cyprus office is today one of the largest members of the local financial services industry, employing almost 100 staff. Our Cyprus team has a long history of providing the highest level of service to Cyprus companies, funds and trusts, as well as companies and trusts in other jurisdictions. We apply detailed local knowledge to international scenarios, providing guidance and constructive solutions to our clients' challenges.

Operating in cooperation with our global marine hubs, our Cyprus office offers a comprehensive range of services for both the luxury yacht and commercial shipping sectors, including vessel registration, local representation, and the formation and administration of ownership structures.

In cooperation with our global marine team, we can offer cost-effective crew employment and payroll services, ensuring support for yacht and commercial vessel owners, representatives, managers, and captains in compliance with the Maritime Labour Convention.

If you have any questions, please contact:

Christina Economou
Business Development Director – Cyprus
marineservices@tridenttrust.com