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European Company in Cyprus

Cyprus

European Company (societas Europaea - SE) is an innovative public Pan European company. The rationale was to create a company having its own legislative framework which would allow companies incorporated in different member states to merge or form a holding company or joint subsidiary without facing the constraints of different legal systems. Taxand Cyprus dicusses how the formation of a European Company can be achieved and what the requirements are.

The formation can be achieved by:

  • Merging 2 or more public or European companies from at least 2 different member states
  • Creating a holding European company with 2 or more public or private limited liability companies including European companies from at least 2 different member states or with a subsidiary in another member state for 2 years or more
  • Setting up a subsidiary with 2 or more companies including European companies from at least 2 different member states or with a subsidiary in another member state for 2 years or more
  • Converting a Cyprus public company with a subsidiary in another member state for 2 years or more

The requirements for the creation are:

  • Share capital of at least  EUR 120,000 (or equivalent in any other currency)
  • Registered and head office can be situated in Cyprus (but this is not mandatory, it can be different addresses)
  • Must be registered in the local Commercial Registry and the registration is published in the European Companies’ Official Journal
  • Statutes must include name, registered office and objects of the company. They must also state whether there is a 1-tier or 2-tier board structure and the number of members
  • Accounting and audit is obligatory
  • SE to be included on the name of the European Company

Discover more: European Company (Societas Europaea) in Cyprus


Your Taxand contact for further queries is:

Zoe Kokoni
T. +357 22 699 222
E. zoe.kokoni@eurofast.eu

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Also published in Thomson Reuters' Taxnet Pro, 07 July 2014 

Taxand's Take

A determining factor for establishing an SE is the tax system of the host country. The tax system of Cyprus makes it an exceptionally ideal and striking location for an SE as it is a combination of favourable tax rates, a vast network of double tax treaties and a straight-forward tax legislation. Following the complete implementation of the EU Merger Directive by Cyprus pre-existed companies in other Member States can now transform into a Cypriot SE devoid of any tax charge.

Taxand's Take Author

Zoe Kokoni
Cyprus

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