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CYPRUS INVEST WITH CONFIDENCE. Using Cyprus as Your Springboard for International Expansion Mr. Phidias Pilides Chairman of the Board, CIPA Moscow, Russia June 23, 2011. Historic moment…. Page 2. Cyprus and Russia: Dynamic Relationship. - PowerPoint PPT PresentationTRANSCRIPT
Using Cyprus as Your Springboard for International Expansion
Mr. Phidias PilidesChairman of the Board, CIPA
Moscow, Russia June 23, 2011
CYPRUSINVEST WITH CONFIDENCE
Historic moment…
Page 2
Cyprus and Russia: Dynamic Relationship
Signing of the Protocol between the Republic of Cyprus and Russia Federation – October 2010
Protocol will:Further strengthen the bilateral investment relationships; Increase flow of trade Act as a catalyst of new investment opportunities; Enhance the business environment and benefit other areas of growth.
Country Overview
Official Name: The Republic of Cyprus
Capital: Nicosia
Area: 9,251 sq km
Population: 870,000
Official Languages: Greek, Turkish
English Widely Spoken
Real GDP Growth: 1.0%
GDP per inhabitant: €21,700
Inflation (HICP): 2.6%
Unemployment Rate: 6.5%
Monetary Unit: Euro
Life Expectancy: 79 years
Form of State: Presidential Republic
(Data 2010)
Cyprus Economy and Competitive Advantages
CYPRUSINVEST WITH CONFIDENCE
“Global Competitiveness Report 2010-2011”
Cyprus was ranked number 40 out of 139 countries by the World Economic Forum "Global Competitiveness Report 2010 - 2011"
The Global Competitiveness Report is a yearly report published by the World Economic Forum
The report assesses the ability of countries to provide high levels of prosperity to their citizens
The World Economic Forum is an independent internationalorganization committed to improving the state of the world byengaging leaders in partnerships to shape global, regional and
industry agendas. 10
“Doing Business Report 2011”
4 6 9 1314
2517
22 23 2432 30 26
37 4151
46
3142
5649 45
7063
80
109
High – 1
Low -183
Cyprus ranked #37 of 183 countries on the overall ease of doing business and #15 of the EU 26
Cyprus as an Attractive Investment Destination
EU and European Monetary Union Member State
Strategic geographical location – ideal for expansion in new markets
Well-developed socio-economic infrastructure
An active Stock Exchange and robust Securities and Exchange Commission
More than 30 years experience as An International Business Center
Cyprus as an Attractive Investment Destination
Market-oriented economy
Macroeconomic stability and performance
Highly educated, qualified and multilingual talent
Stable and welcoming business environment
Low set up and operating costs
Advanced transport and telecommunications network
Renown international shipping centre
Enviable quality of life
Cyprus as an Attractive Investment Destination
Broad range and international quality of financial and business services - legal, tax, accounting, investment and brokerage
Transparent accounting system harmonized withinternational standards
Well developed banking sector for all financial needs
Low-risk business environment offering quick and efficient operations
The Global Integrated Economy is a reality and Cyprus can play a key role as a
Business and Financial Center
Cyprus: Simple, Low Taxation
Cyprus has the lowest corporate tax in Europe of 10%.
A tax administration regime that wants to help foreign investors.
Exempt from tax: Dividend incomeProfits from overseas permanent establishments Profits from the sale of securities
No withholding tax on: DividendsInterestRoyalties paid from Cyprus
Most international transactions exempt from VAT
Cyprus has concluded Double Tax Avoidance Treaties with 43 countries worldwide.
Cyprus as a holding company location
RussianUltimate
Holding Co
Cyprus Holding Co
Treatysubsidiary
EUsubsidiary
Invest through Cyprus in:
an EU country or
a country with no DTT with Russia or
a country with a better DTT with Cyprus
Benefits
Wide Cyprus DTT network
EU Parent Subsidiary Directive
Zero/Low withholding tax in target country
Dividends received by Cyprus Holding Co exempt from tax
No withholding taxes on payments to Russian Ultitmate HoldCo
Russian Outbound Investments
Cyprus as a financing company location
RussianUltimate
Holding Co
Cyprus Financing Co
Treatysubsidiary
EUsubsidiary
Russian Outbound Investments
Russian investor establishes Cyprus company to be the group finance company of foreign operations.
Capitalisation with equity.
Benefits
Tax on profit 10%
Access to EU interest & royalty directive
Zero/Low withholding tax on interest from target country
Interest deductibility in paying company
No WHT on dividends paid to
Russia
Cyprus as an Ideal International Business Services Centre
What Cyprus also offers…
Shipping Companies– Zero tax rate
Financial Group Companies– Low tax rate within a small profit margin
Companies Trading Securities– No tax on profits from sale of securities
Investment Trusts– Tax exemption
Doing Business Through Cyprus
• Cyprus is a dynamic business and financial centre for inward FDI
• Investors have the opportunity to access, through Cyprus, new markets both within Europe and non-EU countries
• The Global Integrated Economy is a reality and Cyprus can play a key role as an business and financial center
Cross-border IPOs through Cyprus
Tax benefits important, but also:
– Legal environment based on common law –
similar to UK
– Companies’ Law based on previous version of
English equivalent
– Capital markets legislation fully harmonised
with EU directives
CIS IPOs at the London Stock Exchange (LSE)
The LSE has been the preferred destination for CIS IPOs abroad
over the last few years.
17 CIS IPOs in LSE during the period 2008-2011
7 of these with topco jurisdiction other than Russia and UK
Cyprus chosen in 4 out of these 7 IPOs
Pipeline appears to be growing
Total funds raised by CIS companies in LSE IPOs 2008-2011
amounted to $6bn.
Russian IPOs into the LSE in 2011
\ Cyprus is now an established and credible TopCo jurisdiction, with increased confidence placed by issuers, investors, bankers and lawyers
\
International Transit Trade Centre
Efficient Customs
Formalities
Reliable Handling and
Delivery System
Advanced Regional
Warehouse &
Distribution Centers
Some of the companies already in Cyprus
GROME MARKETING
Cyprus: Safe & Sunny
Security and safety Excellent public and private
international schools High standard of living High quality tourist facilities
year round Gastronomy Millenia of culture, history and art Fabulous weather
CYPRUSINVEST WITH CONFIDENCE
Cyprus: Investment Opportunities
Banking & Financial Services
B&F Services account for 9% of GDP (2009) and the sector is characterized by economic stability
Offers a strong regional platform for the provision of various banking products and financial services, including investment funds
Unique opportunities for cross-border and international transactions of mutual funds through reliable infrastructure
Cyprus: International Shipping Center
Ranks 3rd top maritime nation in EU27and top 10 globally
Shipping accounts 4% of Cyprus GDP (2009) More than 2,000 vessels with 40 million
gross tonnage Over 130 ship owning and ship
management companies based in Cyprus 2 deep-sea ports with easy access to Suez
Canal and other major freight routes New legislation enacted 29 April 2010 with
the New Competitive “Tonnage Tax System” (TTS)
Favorable tax regime and other benefits for ship owning, ship management, charterers and crew members
Energy Opportunities for the development of Renewable Energy Sources
(RES), Technologies and Production
Important Energy Projects underway: Establishment of the Energy Centre at Vasilikos- Terminal for the importation and storage of petroleum products
Exploration of vast natural gas reserves in Cyprus’ Exclusive Economic Zone (EEZ)
Development and Infrastructure Projects
Projects for promotion of sea tourism (Five marinas in coastal cities)
Large international-scale development projects and thematic parks
Luxurious and state-of-the-art resorts and golf courses
Infrastructure for development of advanced educational and health services
Contact CIPA to learn more!
For more information regarding investment opportunities in Cyprus, please contact us:
+357-22-441133 www.cipa.org.cy [email protected]
Thank you!Спасибо!