Cyprus’ game plan for Foreign Interest Companies

Cyprus continues to attract global business through its forward-looking policies aimed at foreign investors and skilled professionals. Central to this strategic effort is the Foreign Interest Company (FIC) framework, which allows eligible businesses to employ high-skilled third-country nationals (TCNs) through a streamlined and investor-friendly process. Administered by the Business Facilitation Unit (BFU), this framework has been further strengthened by recent legislative and procedural reforms.

What is a FIC?

A Foreign Interest Company (FIC) refers to a business registered in Cyprus – such as a local company (HE) or the branch of an overseas firm (AE) – that meets specific foreign ownership criteria. It must be either majority-owned (more than 50%) by non-EU nationals or include a foreign minority shareholder whose shareholding is valued at a minimum of €200,000.

Criteria for FICs

To register as a FIC in Cyprus, companies must demonstrate an initial investment of at least €200,000. This requirement can be fulfilled either by depositing the sum into a bank account held with a credit institution licensed by the Central Bank of Cyprus (excluding payment institutions) or by providing evidence of business-related expenditures totalling €200,000 – such as invoices for office rent, equipment, or machinery – dated within six months prior to the application. Importantly, this requirement applies universally, regardless of the company’s ownership structure. The funds are not restricted and may be freely used as working capital.

Who can qualify as an FIC?

Eligible businesses must meet at least one of the following criteria to qualify as a Foreign Interest Company. They may be majority-owned, where over 50% of the company’s shares are held by non-EU (third-country) nationals. Alternatively, in the case of minority ownership, if less than 50% of the shares are held by a non-EU national, the value of their share must be at least €200,000 (in addition to the company’s overall €200,000 investment). Public companies listed on a recognised stock exchange are also eligible, as are legacy offshore companies that were active before the change in regime and have records held by the Central Bank. Cypriot shipping companies may register as FICs, as can high-tech or innovation companies involved in advanced research and development in sectors such as ICT, aerospace, biomedical or advanced machinery. Pharmaceutical, biogenetics or biotechnology companies also qualify. Companies owned by naturalised Cypriot citizens – where the shareholders obtained citizenship through investment and continue to meet the conditions of their naturalisation – are eligible, as are licensed private higher education institutes that are registered and approved by the Ministry of Education.

Application Procedure

The application procedure involves completing the BFU application e-form and submitting a Letter of Intent that outlines the company’s profile, activities, staff numbers and expansion plans. Applicants must also provide supporting documents, including incorporation certificates, shareholder information and evidence of the €200,000 investment. Upon submission, the BFU aims to process applications within 10 business days. Successful applicants receive a confirmation letter, which enables them to proceed with employment and immigration processes.

Employment of TRCs

FICs approved by the BFU are permitted to employ third-country nationals under the high-skilled employment category, provided specific conditions are met. These include a minimum gross monthly salary of €2,500, a university degree, diploma or equivalent qualification relevant to the role, an employment contract with a minimum duration of two years, a clean criminal record and medical certificates. There is a transitional five-year period, during which up to 70% of the total staff in these positions can be third-country nationals. During this time, companies are expected to work towards balancing their workforce with local or EU employees. The spouses of eligible TCN employees are granted immediate and unrestricted access to the Cypriot labour market under the family reunification procedure – an important and progressive measure that promotes family integration and enhances employee retention. For support staff earning a gross monthly salary of less than €2,500, a labour market test must be conducted, and the employment contract must be sealed by the Department of Labour.

Naturalisation Pathways

Under the amended Civil Registry Law, highly skilled TCNs employed by FICs may pursue fast-track naturalisation. An adult foreigner who, on the day of application submission and on the day of examination of the application is employed in a company that meets the relevant conditions, and whose employment was high-skilled according to the required criteria, may apply for Cypriot citizenship by naturalisation if certain conditions are cumulatively met. The applicant must have legal and continuous residence for 12 months immediately before the date of application submission. Periods of absence not exceeding a total of 90 days do not interrupt this period. During the immediately preceding 10 years from the 12-month period, the applicant must have legal residence for cumulative periods of not less than 4 years, or 3 years depending on their level of Greek language proficiency (A2 or B1, respectively). Periods of absence not exceeding a total of 90 days annually are not considered absences.

Additionally, the applicant must demonstrate good character, sufficient knowledge of the Greek language at level A2 or B1 (as applicable), sufficient knowledge of basic elements of the contemporary political and social reality of Cyprus, suitable accommodation and stable and regular financial resources sufficient for the maintenance of themselves and their family members. The applicant must also show an intention to reside in the Republic.

The Foreign Interest Company regime exemplifies Cyprus’ commitment to balancing the attraction of foreign capital and talent with the maintenance of regulatory integrity. Supported by the Business Facilitation Unit, this strategic framework positions Cyprus as an ideal base for international businesses seeking a stable, well-regulated entry point into the European Union with access to a skilled, mobile and multicultural workforce.

• By Kyriaki Gerolemou, Partner, Perfect Circle Trust Ltd

This article was first published in the special publication Doing Business in Cyprus. To view it, click here. To read the entire publication, click here.