Cyprus is moving forward with new legislative measures aimed at introducing stricter controls and greater transparency in property acquisitions by foreign nationals and foreign-influenced companies. This development follows heightened parliamentary scrutiny after data revealed notable growth in foreign investments in the country’s real estate sector.
The political party AKEL has tabled two draft laws designed to reinforce the regulatory framework around foreign ownership of land and properties. These initiatives focus on preventing unregulated purchases while prioritizing the housing needs of middle- and low-income Cypriot residents. Furthermore, these bills seek to address economic stability and national security considerations.
The first draft bill recalibrates definitions within the current legislation, targeting loopholes that previously allowed indirect acquisitions through foreign-controlled entities. It expands the scope of what constitutes a “foreign-controlled company” to include any entity where ultimate beneficial ownership, as defined by anti-money laundering laws, lies with a foreigner—even if the company itself is Cypriot or European. The bill also outlines detailed criteria for permit approvals, which will be governed by secondary parliamentary regulations.
Notably, this bill removes ambiguous provisions regarding large-scale land purchases and exempts foreign buyers from Cabinet approval when acquiring a single residence or apartment up to 200 square meters, small commercial spaces, or offices up to 300 square meters. However, there is a firm ban on acquiring forested areas, agricultural land, or properties near buffer zones and sensitive infrastructures.
AKEL’s second proposal amends the Immovable Property (Transfer and Mortgage) Law to tighten oversight at the point of transaction. The legislation empowers the Director of the Department of Lands and Surveys to reject registrations or transfers that contravene the newly reinforced foreign acquisition restrictions. This aims to prevent property ownership concealment through complex corporate transactions and to improve transparency about actual owners.
In parallel, a joint bill by DIKO, DISY, and DIPA seeks to modernize the Immovable Property Acquisition (Aliens) Law, imposing clear limits on foreign property rights. For non-EU nationals, the restrictions would confine purchases to a single residential unit on one plot. Additionally, legal entities seeking to acquire property must ensure that a majority (at least 51%) of ownership or voting rights belong to Cypriot, EU, or EEA citizens.
Similar to AKEL’s policy proposals, the bill forbids foreign buyers from obtaining forest and agricultural lands. The aim is to mitigate the misuse of Cypriot “front companies” being used to bypass ownership rules and to preserve rural and agricultural landscapes.
While these legislative efforts introduce more stringent conditions for foreign buyers, exemptions exist for smaller-scale acquisitions. For those interested in affordable real estate options in Cyprus, exploring listings of cheap apartments or houses and villas could be worthwhile starting points.
Overall, these reforms signal a shift towards a more transparent and controlled property market, emphasizing sustainable development and safeguarding national interests without stymying legitimate investment opportunities.
Support
Information
