On the 1st of May 2004 the Movement of Capital Law
No 115(I) will become effective as Cyprus joins the
European Union. Until that date movement of capital
to and from Cyprus is primarily governed by the Exchange
Control Law:
Exchange Control Law - banking for expatriates,
immigrants, emigrants
Non-Cypriot citizens may open foreign currency and local
deposit accounts but regulations differ per situation
of the expatriate:
* Expatriates residing in Cyprus under a temporary
residence permit without having the right of employment
in Cyprus are considered non-residents and are exempt
from all exchange control obligations.
* Expatriates living and working in Cyprus under a temporary
residence-employment permit are also considered non-residents
but are subject to some exchange control obligations
mainly in order to ensure that their transactions with
residents are in local currency payable in Cyprus.
* Expatriates employed in Cyprus by resident entities
and receiving their remuneration in local funds are
required to operate a Special Resident Account for the
purpose of depositing part of their foreign currency
earnings in order to meet their living expenditure in
Cyprus; the balance of their earnings may be deposited
in any Foreign Currency Account either in Cyprus or
abroad or in an External Account in freely convertible
Cyprus Pounds, with an Authorised Dealer in Cyprus.
* Expatriates employed in Cyprus by non-resident entities
and receiving their remuneration in external funds are
required to operate a Local Disbursement Account for
the purpose of depositing part of their foreign currency
earnings in order to meet their living expenditure in
Cyprus; the balance of their earnings may be deposited
in any Foreign Currency Account either in Cyprus or
abroad or in an External Account in freely convertible
Cyprus Pounds with an Authorised Dealer in Cyprus.
* Persons who settle permanently in Cyprus are considered
as residents under the Exchange Control Law; thus, they
need to obtain a permit covering their assets and liabilities
abroad. In general, immigrants are allowed to hold abroad
all their illiquid assets (e.g., real estate, stocks
and shares) while they are required to repatriate all
their liquid assets (e.g., bank deposits) as well as
all their foreign source income within reasonable time
from acquisition.
* Residents of Cyprus (Cypriots or foreign nationals)
who take up residence outside Cyprus may transfer abroad
from their liquid assets up to CY£5,000 immediately;
any excess amount is deposited in a Blocked Account
and released at the rate of CY£5,000 per year.
Emigrants may also receive outside Cyprus any current
income in the form of interest, rents, dividends or
profits on the basis of documentary evidence or audited
accounts after the payment of any due taxes.
MAJOR BANKS IN CYPRUS:
Central Bank of Cyprus
The Central Bank of Cyprus was established in 1963,
shortly after Cyprus gained its independence. The Central
Bank of Cyprus is responsible for the country's monetary
and credit policy; it supervises banks, administers
the foreign exchange reserves, issues currency and acts
as a financial agent for the Cypriot Government.
Commercial Banks are all member of the Society for
Worldwide Interbank Financial Telecommunication (SWIFT)
and have correspondents in major cities around the world.
Bank of Cyprus
One of the leading Banks in Cyprus.
Cyprus Popular Bank (Laiki)
Also a leading financial institution in Cyprus.
Hellenic Bank
The Hellenic Bank Group commenced operations in 1976.
In a relatively short time, it has become established
as one of the biggest banking and financial institutions
in Cyprus.
Co-operative Bank
The Co-operative Central Bank Ltd (CCB) was established
in 1938 under the Co-operative Societies Laws and Rules
having as its main purpose the provision of banking
and other ancillary services to member-societies which
form the backbone of the agricultural community of Cyprus.
Alpha Bank
Alpha Bank Limited is the fourth largest commercial
bank in Cyprus with a market share close to 7%. The
Bank is a member of the Alpha Bank Group, a Group that
is prominent for its financial strength, pro-activeness
and expansionary strategy.
Universal Savings Bank
The Universal Savings Bank is a major financial institution
in Cyprus.
