The Law establishes a mandatory notification and approval process for certain foreign investments that may affect national security or public order, bringing Cyprus in line with the EU FDI screening framework. It defines the specific conditions that would give rise to a notification requirement, capturing the concepts of new and existing FDIs, investment value, and direct and indirect ownership and control. It focuses on sensitive and strategic sectors, including critical infrastructure, energy, telecommunications and financial services.

A designated competent authority will review covered transactions within defined statutory timelines and may may grant unconditional approval, approval subject to conditions, or prohibit the transaction. The Law also provides for administrative sanctions and penalties for non-compliance, underscoring the importance of early regulatory due diligence and careful structuring and timing of investments and transactions involving foreign participation in Cyprus.

To read the full article please visit Lexology.

For more information please reach out Theodora Alexandrou, Maria Vyronos and Alexandra De Gouveia.