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This publication is available at https://www.gov.uk/government/publications/exporting-to-cyprus/exporting-to-cyprus
1. Cyprus export overview
Cyprus, with a population of less than a million is the UK’s 56th largest export market. The UK is one of Cyprus’ most significant trading partners for goods and services. British products and services are well established on the island.
Contact a Department for International Trade (DIT) export adviser for a free consultation if you’re interested in exporting to Cyprus.
Cyprus’ economic reform programme, following its restructuring of the economy, has created opportunities for UK companies in a number of sectors of the economy.
Benefits for UK businesses exporting to Cyprus include:
- no trade barriers because of its European Union (EU) membership
- high public awareness of UK products and brands
- easily accessible from UK
- English widely spoken
- island economy so relies heavily on imports
- large number of British nationals living on the island and visiting as tourists
- business culture, banking, accounting and legal systems similar to UK
Strengths of the Cypriot market include:
- it can act as a gateway to the Middle East, Persian Gulf, Russia and eastern Europe
- lowest corporate tax in the EU (12.5%)
- advanced telecommunications network and infrastructure
- highly educated and skilled workforce (mostly UK educated)
- double taxation treaties with 62 countries
Read the EU’s practical guide to doing business in Europe.
2. Challenges and risk of doing business in Cyprus
Doing business in Cyprus is very similar to doing business in the UK. However, there are some challenges including:
- lack of transparency and possible bias in government consideration of competing bids
- state bureaucracy and slow procedures
- tender procedures for government projects are carried out exclusively in the Greek language
You should ensure you take the necessary steps to comply with the requirements of the UK Bribery Act.
2.1 Doing business in north Cyprus
The continued political division of the island of Cyprus affects doing business in the areas not controlled by the Republic of Cyprus (north of the island). Although Cyprus is an EU member state areas not controlled by the Republic of Cyprus are not bound by the acquis rights and obligations of the EU.
Trade is possible through the Green Line (border between the Republic of Cyprus and north Cyprus).
3. Growth potential of Cyprus
3.1 Economic growth in Cyprus
Cyprus has emerged from the 2013 financial crisis with a robust economy. The Cypriot economy has now returned to growth and the government’s overspend has reduced. The financial sector is also being restructured. GDP growth of around 2.6% is expected for 2018.
Tourism, financial services and shipping have grown in recent years. Renewed confidence in the banking sector should help further this growth.
Cyprus is implementing a series of fiscal, structural and institutional reforms to promote competitiveness and growth.
Cyprus’ ranking in the Index of Economic Freedom has improved and is above average. However, economic challenges to stabilising the economy include:
- high public debt
- non-performing loans
- pending privatisation initiatives
3.2 Cyprus trade agreements
Contact the SOLVIT team if you have market access issues relating to the operation of the Single Market.
4. UK and Cyprus trade
The UK is Cyprus’ main trading partner. UK exports of goods to Cyprus were £325 million in 2016.
There is close collaboration between the UK and Cyprus in the services sector, particularly shipping.
The major accountancy firms and other large companies operate on the island, often using it as their regional office for Russia, the Persian Gulf, Middle East and north Africa. Foreign companies also use their Cypriot operation to access the London financial markets.
UN comtrade ranked Cyprus’ top imports of goods from the rest of the world during 2016 as:
- distillation products and mineral fuels, including oil
- ships, boats and other floating structures
- vehicles (other than railway or tramway vehicles)
- boilers and other machinery
- electrical and electronic equipment
- aircraft and aircraft parts
- plastics and plastic products
- beverages, spirits and vinegar
- clothing and accessories other than knitted or crocheted apparel)
UN Comtrade ranks Cyprus’ top services imports from the rest of the world during 2015 as:
- telecommunications, computer and information services.
- other business services, such as consultancy, technical services and research and development (R&D)
- financial services
- royalties and licence fees
- personal, cultural and recreational services
- insurance services
- government services
- construction services
5. Opportunities for UK businesses in Cyprus
DIT provides free international export sales leads from its worldwide network. Find export opportunities in Cyprus.
Find high value public procurement notices from the from the EU and European Economic Area (EEA) on Tenders Electronic Daily (TED).
5.1 Energy sector in Cyprus
The recent discovery of significant reserves of natural gas in the exclusive economic zone of Cyprus creates long-term opportunities. Current and future oil and gas projects in Cyprus need expertise in exploration and extraction technologies.
Cyprus also needs to build capacity and develop related sectors including:
- education and training
- security services
- health and safety
- environmental services
- cleaning and catering services
Cyprus’ EU obligations to reduce CO2 emissions are creating opportunities for renewable energy technologies, particularly in solar energy.
Contact firstname.lastname@example.org for more information on opportunities in the energy sector in Cyprus.
5.2 Financial and professional services in Cyprus
Cyprus’ shipping sector offers opportunities in:
- education and skills
- security services, especially as new legislation now allows armed security personnel on board
Commercial operations at Cyprus’ primary port at Limassol have been privatised. Opportunities for UK companies are expected from the upgrading of the port marina of the Larnaca project.
There are opportunities created by the privatisation of state-owned organisations, including accounting and consultancy.
Contact email@example.com for more information on opportunities in financial and professional services in Cyprus.
5.3 Environmental services sector in Cyprus
There are opportunities for UK companies in:
- waste management
- carbon emissions reduction
Contact firstname.lastname@example.org for more information on opportunities in the environment sector in Cyprus.
5.4 Infrastructure projects in Cyprus
Cyprus’s e-government project offers opportunities for UK companies including:
- consultancy on appropriate systems
- development of software
- staff training
Infrastructure projects connected to Cyprus’s developing oil and gas sector include expansion of ports and the creation of a new fuel tank farm to hold national fuel reserves.
Opportunities for UK companies include:
Contact email@example.com for more information on infrastructure opportunities in Cyprus.
5.5 Tourism and leisure sector in Cyprus
Cyprus is currently developing museums, marinas and theme parks.
Opportunities for UK companies in tourism and leisure in Cyprus include:
- safety and security
Contact firstname.lastname@example.org for more information on opportunities in the tourism and leisure opportunities in Cyprus.
5.6 Education and training sector in Cyprus
There are opportunities for:
- collaboration on making Cyprus an education hub for the oil and gas sector
- collaboration between UK universities and colleges with Cyprus educational institutions
- provision of training for vocational qualifications
- supply of educational equipment
- development of professional qualifications
Contact email@example.com for more information on education and training opportunities in Cyprus.
5.7 Other opportunities to do business in Cyprus
Cyprus offers opportunities in most sectors. This includes opportunities for specialist products in developed sectors such as:
- information and communications technology
- food and drink, particularly organic, gourmet and artisan products
- life sciences, particularly medical equipment and pharmaceuticals
Contact firstname.lastname@example.org for more information on wider opportunities to do business in Cyprus.
6. Start up considerations in Cyprus
There are several ways of setting up or growing your business in Cyprus:
- appointing a local agent or distributor
- setting up a local branch or office
- joint venture or consortium
- direct exports
A local partner will provide useful market knowledge, especially if you bid for government tenders, which are normally in Greek.
You can register a company directly with the Cypriot Registrar of Companies.
You should obtain the relevant licences to operate from the appropriate regulatory authority depending on the nature of the business.
7. Legal considerations of doing business in Cyprus
Cyprus’ legal system is based on English Common Law principles. Cyprus has adopted all EU law and regulations known as the acquis communautaire.
Contact the DIT team in Cyprus to help find tax and legal advisers before entering into agreements.
The Cyprus Bar Association can also provide lists of local lawyers.
7.1 Standards and technical regulations in Cyprus
Products and packaging for export to Cyprus should meet EU standards.
Food products must comply with Cyprus’s strict labelling law. This requires the product name, ingredients, net contents and country of origin to be in Greek.
A sticker with a Greek translation on the product is acceptable, provided it does not conceal the original label. The sticker must have the approval of the Ministry of Energy, Commerce, Industry and Tourism.
7.2 Intellectual property in Cyprus
Trademarks, designs, patents and copyright are the principal forms of Intellectual Property (IP) protection available to companies and individuals.
IP law, especially for patent protection, is not totally harmonised within the EU.
The Department of Registrar of Companies and Official Receiver of Cyprus has responsibility for IP.
8. Taxes and customs in Cyprus
The UK and Cyprus have signed a double taxation agreement, ensuring the same income is not taxed in more than one country.
8.1 Value Added Tax (VAT) in Cyprus
The standard VAT rate is 19%. There are reduced rates of 9%, 5% and 0% on specific goods and services.
Check with HM Revenue and Customs (HMRC) regarding VAT refund of business expenses incurred in Cyprus.
8.2 Corporate tax in Cyprus
All companies are subject to a uniform tax rate of 12.5%.
8.3 Income tax in Cyprus
An individual is considered resident in Cyprus for income tax purposes if they are present in Cyprus for a period exceeding 183 days in the tax year. If this condition is met, tax is imposed on income arising from sources within Cyprus and outside Cyprus.
Income tax rates are dependent on taxable income bands which range from 0% to 35%.
8.4 Customs in Cyprus
The internal market of the EU is a single market which allows the free movement of goods and services so no import duties apply.
Cyprus Customs and Excise has responsibility for customs procedures.
9. Entry requirements for Cyprus
UK citizens don’t require a visa to enter Cyprus.
9.1 Travel advice for Cyprus
If you are travelling to Cyprus for business, check the Foreign and Commonwealth Office (FCO) travel advice first.
10. DIT contacts in Cyprus
Contact the DIT team in Cyprus for more information and advice on opportunities and doing business in Cyprus.