Cyprus Ship Registration

In recent years Cyprus has developed a maritime policy which is highly favorable for ship owners.
A ship may be registered in Cyprus if it is majority-owned by a Cypriot person or company; a non-Cypriot company qualifies if it is majority-owned by Cypriots.
Registration traditionally depends on the age and type of the ship. Under the latest rules, cargo vessels of more than 500 tons and not exceeding 15 years of age may be freely registered in Cyprus. Vessels over 15 years of age but not exceeding 20 may be registered subject to a satisfactory entry inspection. Vessels over 20 years of age but not exceeding 25 must also undergo an entry inspection and, where it is required by legislation that the vessel should comply with the ISM Code, operated by a ship management company having its principal place of business in the EU or European Economic Area (EEA). Vessels over the age of 25 are not accepted for registration in the Cyprus register.
Ships may be provisionally registered while they are in a non-Cyprus port; this must be converted into permanent registration during an actual visit to Cyprus within 9 months.
Shipping companies owned by non-residents and deriving their income from sources outside Cyprus are not subject to Cypriot taxation.
A new tonnage tax system was approved by the European Commission on March 24, 2010 under state aid rules for maritime transport. The simplified tonnage tax system extends the favorable benefits available to owners of Cyprus flag vessels and ship managers to owners of foreign flag vessels and charterers. It also extends the tax benefits that previously only covered profits from the operation of vessels in shipping activities, to cover profits on the sale of vessels, interest earned on funds used other than for investment purposes and dividends paid directly or indirectly from shipping-related profits.

TYPES OF REGISTRATION
Provisional registration of a ship may remain in force for six months. Thereafter, it may be renewed once, for a further three months.
Permanent registration The permanent registration of a provisionally registered vessel must be effected within 6 months (or 9 months if the 3 month extension has been obtained) from the date on which she was provisionally registered.
Parallel (Bareboat) Registration The Cyprus legislation provides for the two forms or bareboat registration internationally accepted e.g. the “Parallel-in” registration and the “Parallel-out” registration of vessels, provided certain prerequisites are fulfilled.
MORTGAGES	A mortgage once created must be deposited with the Registrar of Cyprus Ships or with a consular officer on the instructions of the Registrar. The mortgage is recorded in the Register as from the date and hour of its deposit and remains an encumbrance on the vessel until discharged. A mortgage may be created independently of whether the ship is provisionally or permanently registered.
AGE LIMIT	Vessels of any size and type may be registered in the Cyprus Register of Ships or the Special Book of Parallel Registration as long as they comply with the provisions contained in the merchant shipping legislation and the circulars of the Department of Merchant Shipping (DMS) and satisfy certain conditions according to their age and type.
INTERNATIONAL CONVENTIONS ADOPTED	Cyprus is a member of the IMO and the ILO, and has ratified or adopted all international maritime conventions.
APPROVED CLASSIFICATION SOCIETIES	ABS, LRS, DNV, BV, GL, RINA, NKK, KRS, CCS, RS, PRS.

Cyprus Ship Registration Distinctive Advantages

• Low ship registration fees – Cyprus is considered to be one of the most competitive shipping centres in the world, offering fees which are lower than its main competitors. Registration fees depend upon the type of vessel and its gross tonnage.
• No exchange control– free movement of foreign currency.
• Low annual tonnage taxes – calculated according to the type of vessel and the gross tonnage.
• No tax on profits made by the operation or management of a Cyprus flag vessel.
• No tax on dividends received by a ship owning company.
• No income tax on emoluments of officers and crew.
• No capital gains tax on sale of Cypriot vessel or transfer of Cypriot vessel
• No capital gains tax on sale of shares in Cypriot ship owning company and no CGT on transfer of such shares.
• No inheritance tax on inheritance of shares in a Cypriot ship owning company.

Why Valsen Fiduciaries

• Speedy and Efficient Service
• Expert advice on structuring options
• Dedicated ongoing compliance support
• Clientele Priority
• Offers the best value of any country/jurisdiction in the World.