Revamp of non-EU work permits?
The Ministry of Commerce is close to submitting plans for a foreign investment centre to the Council of Ministers and is considering a revamp of work permits for skilled non-EU nationals, following complaints by the international business community in Cyprus.
International businesses lashed out at current government policy at the Annual General Meeting of the Cyprus International Business Association (CIBA) last Wednesday, warning that the range of problems facing international business are pushing investors away from Cyprus.
Among the list of what was missing in government policy, CIBA President, Chris Koufaris cited the absence of a strategic plan, of co-ordination, of simple business rules and no speedy process to deal with problems.
Andreous Neocleous, Managing Partner of the prestigious international law firm of the same name, called for the establishment of a central body “to co-ordinate all the government authorities and departments”. International business companies lost their one-stop shop at the Central Bank of Cyprus after the difference between local and international companies was effectively abolished from May 1.
One-stop investment shop to be created
This call, at least, looks like it is being heeded. “We are almost to the end to submit a proposal to the Council of Ministers for the creation of an independent, private company,” a Ministry of Commerce spokesman told the Financial Mirror.
The company, which will probably be wholly owned by the government, will actively promote Cyprus as an international business centre, will carry out activities such as customer targeting and will act as a one-stop shop for foreign investors.
As well as providing information and guidance on how to set up companies, it will also be involved in “after-care” services and will help chase up applications, for example, for licences.
The first draft has been prepared and once it is passed by the Council of Ministers, it can start operations (it does not need to go through parliament).
Overhaul of non-EU visas?
However, this was not the only aspect of government policy that came in for criticism.
Neocleous said that stamp duty “is so prohibitive that it scares big businesses and commercial deals away from Cyprus.”
He also attacked company registration fees, rules on filing financial statements and the difference between the taxation of individuals and legal entities.
However, it was restrictions on the hiring of skilled non-EU nationals which came in for the biggest criticism.
“The stringent and lengthy procedures for the issue of work and residence permits, the unreasonable restrictions on the number of foreign employees … and the amazing CYP 24,000, the minimum amount of an executive’s salary …. indicate not only unreasonableness but also a negative and chauvinistic attitude,” he said.
Government considering visa overhaul?
The Ministry of Commerce spokesman told the Financial Mirror that with respect to third-country nationals “the problem is very well known to us” and that “I hope that in the coming months there will be a restructuring of the strategy on aliens.”
However, he noted that policy will have to be agreed in co-ordination with the Ministry of Labour.
We were unable to reach anyone for comment at the Ministry of Labour, but in the past it has traditionally taken a restrictive stance on employment of skilled foreign labour, despite almost full employment in Cyprus.
Time is not on Cyprus’ side, however. At its Annual General Meeting, CIBA President Chris Koufaris said “Some members have state that unless this problem is soon resolved they will have to consider outsourcing whatever business activities cannot be performed in Cyprus due to staff shortages.”
Fiona Mullen
