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Temporary Restrictive Measures on Transactions of Cyprus Banks

After the latest developments in Cyprus, all banks re-opened today (28 March 2013) from 12:00pm till 18:00pm. Taxand Cyprus takes a look at what restrictions have been put in place in order to stabilise the economy.

The Central Bank of Cyprus has applied the below measures and restrictions but these are temporary in order to regulate the flow of capital in Cyprus and safeguard the stability of the economic system. These measures are expected to be reviewed and changed in the coming days. The restrictions are as below:

  • Each individual is allowed to withdraw on a daily basis in cash the amount of EUR300
  • Companies can carry out transactions up to EUR5000 on a daily basis per account. In case companies want to pay their payroll, they can make these along with supporting documentation such as pay slip. Cash payments are not allowed for salaries
  • Cheques are not allowed to be cashed immediately; these can only be deposited in an account and then restrictions mentioned above are applicable
  • Any non-cash payment or money transfer outside the Republic of Cyprus or to any account maintained from another credit institution is not allowed, other than:
    • Any payments from EUR5001 to EUR200,000 will have to be approved by the Committee (special committee set up by the Ministry of Finance). The Committee will take its decision in 24 hours according to the availability of cash in the Bank
    • Any payment above EUR200,001, subject to prior approval by the Committee, at the request of the credit institution. The Committee will take its decision in 24 hours according the availability of cash in the Bank
    • Maintenance costs up to EUR5000 per quarter including tuition fees of a person studying abroad and first degree relative is a person who is ordinarily resident in the Republic. Payments for maintenance expenses are allowed only when supporting documents are shown to the bank and these should be presented to the bank by a first degree relative. A birth certificate or a confirmation would be accepted
    • Any payments or money transfers via debit, credit, or prepaid card, up to EUR5000 per month per person per Bank
  • Termination of deposits before the expiry date is not allowed unless the funds will be used for paying off loans within the same bank
  • The restrictive measures will apply to all accounts, payments and transfers regardless of the currency domination
  • For travelling abroad more than EUR1000 per person/per journey is not allowed to be taken outside the Republic

Discover more: Temporary restrictive measures on transactions of Cyprus Banks

Your Taxand contact for further queries is:
Chris Damianou
T. +357 22 699 222

Taxand's Take

The banks reopening, albeit for a shortened period time and with restrictions, will be a much welcomed step for Cypriot individuals and corporations. The capital controls in place are provisionally only to last for a week however that is subject to review. Cypriot Foreign Minister Kasoulides has said he expects that the measures on its bank will be fully lifted in "about a month".

Taxand's Take Author

Chris Damianou