Local or international ship management and crew management businesses - incorporated or unincorporated - have the option to be taxed either at the rate of 4.25 percent or at rates equal to 25 percent of the rates used to calculate the tonnage tax that would be payable on the vessels under management.
Limassol, where our office is located, is characterised as the commercial capital of Cyprus and as the most important port of the country and the Cyprus Department of Merchant Shipping are both located in Limassol, therefore we are able to serve our clients rapidly and effectively.
Cyprus as a Maritime Center
Cyprus has over the years become one of the largest shipping centers worldwide. We have several of the globally top-ranking ship management companies on our island, who are responsible for managing roughly 20% of the world’s fleet.
Responsibility for the development of maritime activities lies with the Shipping Deputy Ministry, which was established on the 1st of March 2018.
The Cypriot flag is a top-quality sovereign flag which duly adheres to all safety and security standards deriving from the Paris and Tokyo MoUs and it is “White Listed” on both MoUs. More than 150 dedicated maritime specialists at the Shipping Deputy Ministry offer tailored, 24/7 service from our offices in 7 different countries.
Competitive Advantages
Limassol, where our headquarters are stationed, is the heart of the Cyprus maritime cluster. Limassol hosts more than 200 companies offering shipping and shipping-related services from Ship ownership and Ship management to Insurance, Finance, Brokerage, Bunkering, Ballast water system production, Marine training, Maritime technology in satellite and radio systems and many more.
Cyprus is amongst the countries that have a prominent role in forming global shipping policies with a strong presence and a powerful voice in all maritime fora and international organizations such as the IMO, the ILO, and the European Union.
Additionally, the Cyprus Shipping Industry provides significant advantages such as the tonnage tax system where the lawfully exempts shipowners, charterers and ship managers from all profit taxes and imposes tonnage tax on the net tonnage of the vessels in substantial rates. Also, there is no tax on shipping profits made from certain shipping activities including profits from the sale of qualifying ships and there is no tax on dividends paid out of profits made from qualifying shipping activities.
Services
We can undertake to provide you, through the Shipping Deputy Ministry and the Registrar of Companies in Cyprus, the services of:
- Incorporation of shipping companies in Cyprus and abroad
- Ship registration (provisional, permanent, bareboat – parallel registration)
- Yacht registration
- Any requests related to maritime security matters concerning Cyprus Flag Ships
- Legal and tax opinions on any relevant matter.
- Registration of Vessels under Cyprus flag
- Registration of Vessels and Yachts in Foreign Jurisdictions
- Deletion of Vessels and Yachts from Foreign Jurisdictions
- Drafting and Registration of Mortgages and Deeds of Release
- Charter party and Seafarer Contracts
- Agreements on Sale and Purchase of ships
Some recent examples of related work handled in this sector includes:
- We have represented a Ship-owners group on a senior secured term loan facility, for the purpose of purchasing of a Vessels and on collateral assignment of earnings and mortgages.
- Acting for Shipowners and Bareboat Charterers, in relation to a parallel flag registration in Liberia and Malta, including Waiver of Owner/Tonnage/FME status is on the Application for Registration, Mortgagee Consent and COE (encumbrance).
- Acting as the Legal Advisors of a Cyprus Shipping Fund, Registered Alternative Investment Fund (“RAIF”), registered with the Cyprus Securities and Exchange Commission (CySEC).