Lawmakers have introduced new bills to parliament seeking to impose strict limits on real estate purchases by non-European Union nationals and foreign-controlled companies.
Three separate bills—two from the opposition Progressive Party of Working People (AKEL) and one from a cross-party group of MPs—are aimed at controlling the indirect acquisition of property and preventing foreign entities from buying large tracts of land.
Under the provisions of the bills, non-EU individuals would largely be restricted to acquiring only one apartment, one house, or one office.
The legislation also targets companies, some of which have reportedly purchased property while concealing their foreign ownership behind Cypriot intermediaries.
One of the AKEL bills requires the Director of the Land Registry to refuse the transfer, registration of a sales contract, exchange, or assignment of immovable property if the transaction is subject to the restrictions of the existing foreigners’ property acquisition law.
The explanatory report accompanying this bill states that the proposed regulations are considered “necessary” to strengthen checks on the legality of property acquisition by foreigners and to prevent the indirect purchase of real estate through companies or assignment contracts. It also seeks to guarantee transparency regarding the identity of the beneficial owners of legal entities acquiring property in Cyprus.
AKEL’s second bill contains several provisions, including:
- Expanding the definition of a “foreign-controlled company” to include any organisation whose beneficial owner, under anti-money laundering laws, is a non-Cypriot.
- Clarifying that a Cypriot or EU company controlled by non-Cypriots is not exempt from the definition of a “foreigner.”
- Mandating that the conditions, restrictions, and criteria for property acquisition by foreigners be set by Regulations, which must be submitted to the House of Representatives for approval.
- Repealing certain sections of current legislation that contain ambiguities, specifically those related to the acquisition of large tracts of land by non-Cypriots.
- Waiving the requirement for Cabinet approval for foreign individuals acquiring one apartment or house up to 200 square metres (sq. m.), one shop up to 200 sq. m., or one office up to 300 sq. m.
- Allowing foreign-controlled legal entities to acquire, without Cabinet approval, one shop up to 200 sq. m. or one office up to 300 sq. m.
- Banning the acquisition of forest or agricultural land, as well as property near the ceasefire line or areas and infrastructure deemed of vital importance.
The proposed AKEL amendments are considered necessary to make current legislation more effective by both abolishing provisions that allow indirect property acquisition without Cabinet permission and introducing mechanisms and criteria for effective control.
The separate proposal, submitted by a cross-party group of MPs, focuses on restricting third-country citizens to acquiring only one residence or apartment on a single plot, whether built or for construction. The authorisation granted would be valid for only one acquisition transaction and cannot be transferred or extended to cover more than one property, person, or legal entity.
This bill also introduces restrictions on legal entities, requiring that at least 51% of the issued share capital, voting rights, or control must belong to citizens of Cyprus or another EU/EEA member state, or to a legal entity established in, and having its main seat or principal place of business within, an EU/EEA state, including the Republic of Cyprus.
Furthermore, the cross-party bill prohibits non-Cypriots from acquiring forest or agricultural land.
The MPs stated that the proposed regulations are necessary to prevent the phenomenon of Cypriot companies and other organisations acting primarily as intermediaries for property purchases.
The cross-party proposal was signed by MPs Zacharias Koulias, Panicos Leonidou, Pavlos Mylonas, Chrysanthos Savvides, Christos Orphanides, Kyriacos Hadjiyiannis, Nicos Sykas, and Michalis Giakoumi.
Read more:
