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Redomiciliation out of Cyprus. Obtaining Registrar’s Consent for Redomiciliation: Required Documents and Procedures
Since 2006, Cyprus legislation has allowed local companies to re-domicile to other jurisdictions, provided certain conditions are met. One major condition is that the national legislation of the target overseas country must allow such a transfer. The other condition is obtaining the consent of the Registrar of Companies in Cyprus.
This article will focus on the second condition and explain the necessary steps to obtain the Registrar’s consent for the transfer of the company to another jurisdiction.
The Registrar’s consent is granted through the issuance of a “certificate of consent.” However, obtaining this consent is not an automatic process and requires a specific set of documents and procedures.
To obtain the Registrar’s consent, the company must submit to registrar an application for the continuation outside of Cyprus called form ME2 (this application will include the name of the company and the jurisdiction it wants to be registered in, the name and address of the respective registrar in the approved country or jurisdiction, the proposed date of redomiciliation) The company must also pay certain fees and provide the Registrar with the number of accompanying documents, including the following:
- special resolution of the company’s shareholders, authorizing the application to registrar and approving the company’s interim financial statements;
- the certified and approved (at the above-mentioned meeting) interim financial statements;
- statement of solvency of the company, confirming among other things that the directors are not aware of any circumstances that could adversely affect the solvency of the company within a period of three years;
- the approval / consent of the competent licensing or supervisory authority in case the company is licensed or supervised by a competent authority in Cyprus;
- documents from competent tax authorities certifying that the company does not owe taxes and duties. Generally – Tax, VAT and social insurance clearance certificates are expected to be provided); [1]
- the stock exchanges consent (for public companies);
- Cyprus Securities and Exchange Commission consent (for public companies);
- a prospectus or any other equivalent document (for public companies).
Upon signing of the special resolution (as mentioned above) company has:
- to proceed with the publication of the notice stating the facts of the special resolution approving the re-domiciliation in two daily newspapers of wide circulation in Cyprus and
- to send a copy of the publication to the Registrar of Companies within fourteen days from the publication.
Than company shall wait for the 3 month.
After submitting the application and accompanying documents to the Registrar, the company must wait for a period of three months. During this time, any creditor of the company may object to the redomiciliation and apply to the Court for review. The Court may then either approve the redomiciliation, accept it with sufficient guarantees, or prohibit the redomiciliation altogether.
To obtain consent for redomiciliation from the Registrar, certain conditions must be met, failing which the Registrar may reject the application.
- Firstly, the company’s Memorandum and Articles of Association (M&AA) must include a provision allowing for redomiciliation to another jurisdiction. If such a provision does not exist, the M&AA must be amended before the redomiciliation process can begin.
- Additionally, the company must ensure that it is up-to-date with all its statutory obligations and has settled all taxes due. This includes paying all outstanding debts to state bodies and filing all required forms such as annual and tax returns.
- Furthermore, there should be no ongoing legal proceedings against the company for dissolution, insolvency, settlement, enforcement, or any similar matters anywhere in the world.
After three months from the date of publication of the notice of the special resolution and provided that no objection has been raised, the Registrar of Companies will issue a certificate of consent for the redomiciliation of the company under the national legislation of another jurisdiction, if satisfied that all conditions have been met.
In addition to obtaining the Registrar’s consent, the company must also complete a separate process in the accepting jurisdiction. This involves obtaining a Certificate of Continuation from the competent authority of the chosen country, which must be delivered to the Registrar as a legalised (apostilled) copy, along with its certified translation.
After submitting the Certificate of Continuation to the Registrar of Companies later will proceed with the strike-off the company from the companies register, issue a certificate of strike off, and publish the relevant information in the government’s gazette.
At this point, the Cypriot company will no longer exist in Cyprus, and its continuation will be considered in force in the foreign jurisdiction.
[1] It shall be taken into consideration that in connection with redomiciliation out of Cyprus, Cyprus tax authorities may have the right to tax any unrealized gains that should been created in Cyprus at the time of redomiciliation.
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