Legal change in Cyprus – what you need to know

Cyprus has recently broken ranks with the rest of the EU by announcing it will happily accept tourists from Britain from 1 May, providing they can prove they have had both doses of the Covid-19 vaccine. The deputy tourism minister confirmed they wanted to give clarity to travellers looking to book a trip, and the EU has not yet reached an agreement on travel. This is not the first time Cyprus has hit the headlines recently – indeed, the country has been praised for its general handling of the pandemic. The Covid-19 Performance Index, compiled by the think tank Lowy Institute, ranked Cyprus as number one in Europe for its handling of coronavirus. The ranking considered confirmed cases and deaths, amongst other factors.

In addition to the country’s robust response to coronavirus, the local economy is also buoyant and likely to be further boosted by Brexit. Cyprus has historically had a special relationship with the UK – a fact which was underlined by Dominic Rabb when he visited the country recently. It is thought that as the dust settles on the UK’s departure from the EU, businesses looking for routes into the EU will increasingly turn to Cyprus. Located in the eastern Mediterranean, the island is in a strategically important location, not just for the EU but North Africa and western Asia too. Further, the cost of doing business in Cyprus is competitive and the government has not introduced any new quotas or tariffs post-Brexit.

So, with Cyprus ticking more boxes for businesses and on its way to becoming recognised as an international hub, what do lawyers need to know?

Cyprus was a British colony until the 1960s and as such its legal system should be familiar to most UK lawyers. It is also a common law jurisdiction. However, work is currently being done to ensure the legal system is sufficiently modernised and legislation is fit for purpose.

Legal change in Cyprus

In 2017, Lord Dyson and others were appointed by the Cypriot Supreme Court to review the civil procedure rules. This review and the resulting plan to modernise Cyprus’s justice system is to be welcomed.  Taking from the English Civil Procedure Rules, the new Civil Procedure Rules aim to allow courts to deal with disputes more effectively and efficiently. After meeting with the Cyprus Bar association, the Ministry of Justice has also taken steps to employ 32 new judges, who, it is estimated, will be able to deal with around 11,000 cases, significantly relieving the burden on the Cyprus courts.

The new commercial court will have jurisdiction over contracts and disputes between companies, and will operate under an anticipated 18 month fast-track procedure independent of district courts. New civil courts have also been launched and again, these steps forward have been significant in reducing the backlog of cases. The new commercial court is particularly relevant for international companies looking to do business in Cyprus, as the court has been designed with a focus on resolving international disputes, much in the same way as we have seen Singapore and Dubai, for instance, establish their own international commercial courts in recent years.

Embracing technology and modernising the Cypriot legal system has also been at the heart of recent reforms, with a proposed e-Justice system in the pipeline which will focus on digitising court administration.

Looking ahead and the Cypriot government is continuing to look at increasing transparency. At the beginning of this year (2021), we saw an ambitious array of measures announced, all designed to cut down on corruption. These include mandatory disclosure of state tenders’ procedures; legal powers to reclaim assets obtained by illegal measures; exclusion of companies having acted unlawfully from state projects; monitoring of asset statements of politicians and officials; transparency on political parties’ funding; free access to public records; internal audits of ministry procedures and a limit to parliamentary immunity.

Lobbying and its role in Cyprus

When it comes to modernising a legal system and ensuring the lines of communication between government, business and its citizens are open, lobbying can often have a particularly important role. Cyprus has recognised this and is currently taking steps to ensure its lobbying system and process is transparent. Modern, science-based, transparent lobbying is very new in Cyprus and the proposed bill on Transparency in the Public Decision-making Process and Related Issues, which will regulate lobbying, is currently before Parliament.

Established last year, Cyprus’ first lobbying start-up, Zenox Public Affairs (www.zenox.cy), was set-up to help boost access to justice at all levels. Its activities include exploratory consultations, legal drafting and delivery of legislation to policymakers, as well as continuous updates about pending legislation. Zenox has also developed Nomoplatform (www.nomoplatform.cy), which allows users to track the policy-making process. This platform is online and free to access, meaning anyone with an interest in Cyprus can now easily see how legislation is progressing through its various stages.

As an example of lobbying in practice, Bolt, the global transport company which offers ride-hailing, is currently engaging with the country’s Ministry of Transport, Communications and Works to help ensure the legal framework is sufficiently modernised to suit their operations.

From the 1st of May onwards Cyprus will likely see an influx of tourists and continue to make headlines. This coupled, with its attractive qualities as a post-Brexit trading post for many international businesses, as well as a buoyant post-Covid economy means more and more businesses are going to be looking towards Cyprus for opportunities. Its increasingly modern legal system and judicial process certainly means Cyprus is one to watch for lawyers and businesses alike.

Nicolas Kyriakides, Partner at Harris Kyriakides

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