We offer our clients our expertise on the creation and implementation on the full spectrum of Trust Structures, including the Cyprus International Trust.
Cyprus trust law is essentially based on the English system. Trusts are mainly regulated by the Trustee Law, Chapter 193, enacted in 1955 and based on the English 1925 Trustees Act. This is supplemented by the English doctrine of equity and English case law prior to 1960.
In 1992, Cyprus enacted the International Trusts Law, which has since been amended to bring it up-to-date. This was done to update and modernise the law and establish Cyprus as an offshore and financial centre and a respectable trusts jurisdiction.
The establishment and operation of a Trust can assist our clients in matters such as:
- Privacy and confidentiality in respect of the assets and the beneficiaries;
- Mitigation of tax liabilities;
- Act as a management and investment vehicle;
- Provide a lasting benefit for special categories of persons, such as mentally disabled persons, after their caretakers and initiate family pass away; and
- A Cyprus International Trust can be used as an asset protection vehicle as it is immune from forced heirship and claw back rules in other jurisdictions where the assets are located – a Cyprus International Trust which is set up after 2012 has no expiration date, unless otherwise stated in the Trust instrument;
A Cyprus International Trust can be created by anyone provided that the Settlor is of sound mind and of right age. The restrictions imposed by the International Trusts Law of 1992 to 2012 focus on the residency status of the Settlor, the Trustee and the Beneficiary are provided below:
- The Settlor
The Settlor is the person who forms the Cyprus International Trust and can be either a natural or legal person but must not be resident in Cyprus during the calendar year immediately preceding the creation of the trust.
- The Trustee
The Trustee or at least one of the Trustees must be resident in Cyprus for the whole duration of the Cyprus International Trust. This means that if the Settlor wants to appoint a Trustee who has his resident outside of Cyprus then he must appoint a second trustee who is located in Cyprus. In such cases, our firm can provide such a service by acting as the Trustee.
- The Beneficiary
The Beneficiary or Beneficiaries must not be resident in Cyprus during the calendar year immediately preceding the creation of the trust (irrespective of whether the Beneficiary is a natural or legal person).