Tag: Cyprus

Competition Clearance in Cyprus – a quick summary

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Under Cyprus law, transactions such as mergers and acquisitions resulting in concentrations of major importance which meet the threshold prescribed under the Control of Concentrations Between Undertaking Law 83(I)/2014 (the “Law”) may have to be notified to the Cyprus Commission for the Protection of Competition (“CPC”).

Which acts of concentration must be notified?

Acts of concentration of major importance within the scope of the Law, shall be notified to the service of the CPC (the “Service”) before their implementation and following the conclusion of the agreement or before its conclusion upon proving to the CPC the existence of a bona fide intention to enter into an agreement. A concentration is considered to be of major importance where:

(i) the aggregate turnover achieved by each of at least two of the participating undertakings exceeds EUR 3.500.000 (EUR 3.5 million);

(ii) at least two of the participating undertakings achieve turnover in Cyprus; and

(iii) at least EUR 3.500.000 (EUR 3.5 million) out of the aggregate turnover of all participating undertakings is achieved in Cyprus.

Notifications and timeframes

With the submission of the notification, a fee is paid to the Service of the CPC (currently set at EUR 1.000) which marks the commencement of the initial stage of the review. The Service will then proceed with a preliminary evaluation of the notification and prepare a written report to the CPC with its reasoned opinion. The CPC will in turn examine the notification taking into account the written report produced by the Service and take a decision as follows:

(a) the notified concentration does not fall within the scope of the Law and/or within the meaning of concentration; or

(b) the concentration does not raise serious doubts as to its compatibility with the functioning of competition in the market and the concentration is declared compatible with the functioning of competition in the market; or

(c) the concentration raises serious doubts as to its compatibility with the functioning of competition in the market and commences full investigation proceedings.

If the CPC decides to initiate a full investigation it invites the parties to pay an additional fee (currently set at EUR 6.000).

The Service has a statutory deadline of 1 month to notify the parties of the decision taken by the CPC on whether the concentration may be implemented (Phase I review) or whether the concentration is going to be fully investigated as per point (c) above (Phase II investigation). Depending on the complexity or volume of information, the Service may extend the deadline by 14 days in which case it shall inform the notifying undertaking at least 7 days before the expiry of the initial statutory deadline. If additional information is required for the purposes of securing the completeness of the notification, the statutory deadline is reset to 1 month.

If the notifying undertaking does not receive CPC’s decision within the expiration of the aforementioned timeframe, the transaction is deemed to have been declared compatible with the market.

Publication of CPC decision and confidentiality

The nature of the notified concentration, names of the participating undertakings and the economic sectors involved are published in the Official Gazette of the Republic of Cyprus (“Official Gazette of Cyprus”). A non-confidential version of CPC’s decision on the notified concertation with the redaction of selected parts of the decision is published on the Official Gazette of Cyprus and the website of the CPC upon a confidentiality request by the parties involved in the concentration.

The CPC and the Service are bound by a duty of confidentiality and their members and officers are prohibited from communicating and/or publicising confidential information and business secrets which become available to them in the process of the notification. The notifying undertaking may also specify to the CPC which documents, statements and material it considers as confidential information and/or business secrets.

Basic notions and definitions

“Undertaking”In Competition Law, an undertaking covers any entity engaged in an economic activity, regardless of its legal status and the way in which it is financed. Any activity consisting in offering goods or services on a given market is an economic activity.
“Concentration”A concentration arises where a change of control on a lasting basis results from:  

(a) the merger of two or more previously independent undertakings or parts of undertakings;  

(b) the acquisition, by one or more persons controlling at least one undertaking, or by one or more undertakings, whether by purchase of securities or assets, by contract or by any other means, of direct or indirect control of the whole or parts of one or more other undertakings;  

The creation of a joint venture performing on a lasting basis all the functions of an autonomous economic entity also constitutes a concentration within the meaning of point (b) above.

Failure to comply with the law & administrative sanctions

The implementation of a transaction giving rise to an act of concentration of major importance is prohibited under Cyprus Law unless such transaction is cleared by the CPC. Failure to obtain clearance may result in fines, including an administrative fine of up to 10% of the total turnover of the undertaking with an obligation to notify. The CPC also has the power to order the dissolution or partial dissolution of a concentration, in order to secure the restoration of the functioning of competition in the market.

Our services include

  • Preliminary assessment to determine whether the transaction constitutes a concentration of major importance which must be notified to the CPC;
  • Comprehensive advice on cross-border and national transactions;
  • Merger control filings (notification) and approvals (clearance);
  • Request for confidentiality by redacting selected parts of the published clearance decision.

Get in touch for an initial consultation

The information provided in this article does not and is not intended to constitute legal advice; instead, all information contained in this article is for general informational purposes only. If you require assistance with any legal matter, including a matter referred to in this article, you should contact one of our attorneys to obtain advice tailored to your specific circumstances.

“An Evolving Profession” by Andrew Demetriou, Co-Founder, Managing Director, Ioannides Demetriou LLC

Posted on | by Paschalis Paschali

“The days of the lawyer as ‘Jack of all trades’ – and, dare I say it, ‘master of none’ in many cases – are long gone” Andrew Demetriou, Co-Founder, Managing Director, Ioannides Demetriou LLC

Read more about the evolving legal landscape, the developments in technology and the skillset that lawyers need to master in Mr. Demetriou’s recent interview in Gold Magazine.

An_Evolving_Profession_ADemetriou_GoldMagazine_TheLrgalEdition_Issue137-August2022

Download the article here

The Legal 500 (Leagalease) Country Comparative Guide: Insurance & Reinsurance

Posted on | by Paschalis Paschali
Country Comparative Guide: Cyprus Insurance & Reinsurance

This country-specific Q&A provides an overview of insurance & reinsurance laws and regulations applicable in Cyprus. Ioannides Demetriou LLC is a contributing firm, where Christina Ioannidou, Partner, and Katerina Hadjichristofi, Partner, provide information about the current issues affecting insurance and reinsurance in Cyprus and address topics such as contract regulation, licensing, penalties, policyholder protection, alternative dispute resolution as well as personal insight and opinion as to the future of the insurance market over the next five years.

Read the full Q&A here

Or download the Q&A PDF here

ISO 9001 Certified since 2007 for the Provision of services of advocacy, legal advisors, legal consultants in all fields of the legal profession

Posted on | by Paschalis Paschali

We are proud to have consistently upheld our certification with ISO 9001 from 2007 until today, initially with NIS ZERT Hellas and, as from 2012, with the Cyprus Certification Company.

We have maintained our Quality certification in the fields of the provision of services of advocacy, legal advisors, and legal consultants, in all fields of the legal profession, since our formation. 

This represents recognition from an accredited independent certification body that we work to the Quality Standards set by the International Certification Network. 

We thank our lawyers and staff for their dedication to quality because, as Aristotle said, “Quality is not an act. It is a habit.”

Brexit and the Insurance Industry in Cyprus

Posted on | by Paschalis Paschali

In light of the UK withdrawal from the EU and in the absence of an agreement that allows insurers and brokers to continue to service clients and risks located in EU countries, UK insurance firms shall no longer have passporting rights to European markets including Cyprus.

Passporting rights allow firms registered in the EEA to do business in other EEA states without additional authorisation being given from each country. Without passporting rights, UK intermediaries may not be permitted to place certain European risks with insurers. Many insurers have been restructuring their business, planning the relocation or opening of new branches in EU27 member locations including Cyprus. This will allow them to continue to operate within the EU27 following Brexit as well as in other jurisdictions where the EU has bilateral trade or services agreements.

The European Insurance and Occupational Pensions Authority (“EIOPA”) has published a number of recommendations intended to facilitate an orderly transition of UK insurance business in EU states post Brexit (the “Recommendations”). The Recommendations set out a number of principles that will apply to in respect of the conduct of UK insurance firms which essentially prohibit new business (including renewals) but allows ongoing administration of insurance contracts which were incepted before 31 December 2020 until such time they expire or are terminated on the basis of Recommendation 6 (which effectively states that the location of the risk remains in the UK (on the assumption that the risk was first underwritten by a UK insurance entity).

In response to EIOPA Recommendations the Insurance Companies Control Office (the “Cyprus Insurances Regulator”) has indicated that it intends to follow and apply all the Recommendations and that they will be issuing relevant orders for business written in Cyprus by UK companies with respect to each Recommendations, before the UK withdrawal date.

Whilst, the Cyprus Regulator has yet to issue relevant orders in connection to the Recommendations, Law 19(I)/2020 was published and is effective on the 6th March 2020.  The said law, by amending national relevant law, aims to regulate the services offered by British insurance companies in Cyprus and essentially, the run-off of UK insurance and non-insurance business which was sold in Cyprus to customers before 31st December 2020. The new legislation grants to insurance companies and insurance agents offering insurance products from the United Kingdom to the Republic of Cyprus a two-year grace period by which they may continue managing the affected portfolios as follows:

  • Insurance products already in issued shall continue to have legal effect without requiring any amendment increasing the overall cost,
  • British Insurance Companies in Cyprus can settle any claims arising during the grace period
  • British Insurance Companies in Cyprus can continue to collect premiums settle any undertaken liabilities in a business as usual way.

For the affected insurance companies to continue offering services after the 2-year grace period a relevant license from the Cyprus Insurances Regulator must be obtained.

It is clear from the above that, UK intermediaries and entities which intend to continue or commence distribution activities to EU27 policyholders and for EU27 risks after the UK’s withdrawal are established and registered in the EU27 in line with the relevant provisions of the IDD. Recommendation 9 requires that intermediaries, which are legal persons, demonstrate adequate corporate substance, proportionate to the nature, scale and complexity of their business.  Intermediaries should not display the characteristics of an empty shell.

Our firm provides legal advice and services with respect to the re-domiciliation or new formation of a Cyprus Intermediary (broker, agent etc.) pursuant to the provisions of applicable Cyprus laws which essentially adhere to and adopt the provisions of Directive (EU) 2016/97 of the European Parliament and of the Council of 20 January 2016 on insurance distribution (the “IDD”).

Our firm also advises with respect to Cyprus law matters that may arise with respect to the business of a UK firm including in the context of a UK firm executing an insurance business transfer to an EU group entity to ensure continuity of service and to eliminate any potential detriment to those customers, i.e. transferring customers to whom policies were sold under their freedom of services passporting permissions. Such transfer can resolve the issue of having EEA domiciled customers (whose policies were sold under the freedom of services passporting permissions) by transferring them to EU subsidiaries, however, UK insurers may still have customers who have been sold a product or contract in the UK, but who relocate to an EEA country. This will continue to occur post Brexit and it is expected that the Cyprus Insurances Regulator will also address this issue in due course.

Oil & Gas Services in Cyprus

Posted on | by Paschalis Paschali

Ioannides Demetriou LLC is recognised as a leading Oil & Gas law firm in Cyprus. It represents major players in the Cyprus market, including government, semi-government, public and private clients in all aspects of the Oil & Gas supply chain, including upstream, midstream, downstream and Liquefied Natural Gas (LNG).

The following article is featured in Gold, The Business Magazine of Cyprus – Supplement with special feature on Oil & Gas Services in Cyprus.

Oil-and-gas-supplement-IDLAW-GOLD

GOLD News Cyprus: Leading Law Firms in Cyprus – Ioannides Demetriou LLC

Posted on | by Paschalis Paschali

Ioannides Demetriou LLC is featured in GOLD: The Business Magazine of Cyprus, Issue 113, 16th Aug 2020.

“Ioannides Demetriou LLC is an established full services commercial law and litigation firm and is considered a leading law firm in all the fields it operates.”

The Legal 500 and Chambers and Partners also recognise our firm’s co-founders, Pambos Ioannides and Andrew Demetriou as leading individuals. Our directors, Christina Ioannidou, Christos Frakalas, Zoe Christou and Savvas Yiordamlis are recommended in these guides and others.

ID LAW Leading Law Firm in Cyprus
ID LAW Leading Law Firm in Cyprus

Cyprus on its way to welcoming a new digital era

Posted on | by Paschalis Paschali

The Covid-19 pandemic has, undoubtedly, increased the need for adopting different digital technologies in all economic, industrial and business sectors.

Cyprus has taken considerable steps towards the adoption of digital technologies by incorporating the provisions of Regulation 910/2014/EU (hereinafter the “Regulation”), in its national legislation with the enactment of Law 55(I)/18 (hereinafter the” Law”). Both the Law and Regulation establish a legal framework for e-signatures, e-seals, e-documents and in general all forms of electronic identification.

Additionally, on the 1st of March 2020, the Deputy Ministry of Research, Innovation and Digital Policy was established, one of the most important goals of which, is the adoption of a national digital policy and the creation of a powerful digital economy.

As the Deputy Minister of Research, Innovation and Digital Policy says, more digital services will be made available for the public in a few months.  Such services seem to include the issuance of a certified copy of birth certificate, the transfer of immovable property to an individual or even the registration of a company with the Registrar of Companies.

What the Deputy Minister has initiated to do is to take small steps to automate services in all ministries and departments for the benefit of individuals and businesses. These actions were part of a long-term, two or three year plan, but as it seems, efforts are being made for the necessary procedures to be concluded within the following months.

An example of the goals set by the Government concerns the Citizens Service Centres which up to now used to accept around 1,000 visitors per day. The goal is to offer services electronically so that the above number will be reduced to 100 to 200 visitors per day.

Other government departments that seem to be in imminent need for digital upgrade is the Registrar of Companies, the Town Planning and Housing Department and the Land Registry, while large projects such as the digitalization of hospitals and courts are estimated to continue according to plan.

Additionally, the Government seems to be in consultation with the Association of Cyprus Banks so as to permit to individuals and businesses to conclude their transactions electronically without being necessary for them to be physically present in order to sign the appropriate documents.

What is in fact stressed by the Deputy Minister of Research, Innovation and Digital Policy, is that the acquisition of an e-signature, in compliance with the provisions of the Law and Regulation, is a necessary precondition for the said services to be carried out electronically.

According to the Regulation, an e-signature can be obtained by a qualified trust service provider. Currently, in Cyprus, there is only one provider listed in the Trusted List Browser that is authorized to provide certificates for qualified e-signatures and that is, JCC Payment Systems Ltd.  The Cyprus Stock Exchange, has assumed the role of a local registration authority mediating between the applicant and the trusted provider for the issuance of a qualified certificate for e-signatures. It is noted that according to the Regulation the acquisition of a qualified signature shall have the equivalent legal effect of a handwritten signature (Article 25).

Of course, the legal effect of e-signatures remains to be seen, as, there is no relevant case law indicating how documents bearing an e-signature will be treated by Cyprus Courts. However, it seems that the Cyprus Government is placing the project of introducing digital technologies in everyday transactions at its top priorities while it is commonly admitted that the coronavirus crisis has made the Government to review and reshape its way of thinking and take considerable steps towards the creation of a new era which will respond more effectively to the needs this new state of affairs.