In recent years, the Republic of Cyprus has taken significant steps to attract foreign investment and highly qualified professionals, creating a favorable environment for companies with foreign participation. As of January 1, 2022, a new strategy was implemented aimed at simplifying the procedures for obtaining work and temporary residence permits for foreign employees. A key element of this strategy was the establishment of the Business Facilitation Unit (BFU), which functions as a one-stop shop for registering new companies and processing the necessary permits.

Requirements for companies with foreign participation

In order for a company to benefit from the simplified procedure for hiring foreign employees, it must meet certain criteria:

1. Ownership structure: The majority of the company’s shares (more than 50%) must be held by third-country nationals. If the foreign shareholding is 50% or less, the nominal value of this shareholding must be at least EUR 200,000.
2. Financial requirements: The ultimate beneficial owner must invest at least €200,000 in the company’s operations in Cyprus. This amount must be transferred to the company’s account in a Cypriot bank from outside Cyprus.
3. Physical presence: The company must have a physical office in Cyprus, separate from the residential premises. The use of co-working or shared offices is allowed, but such cases are considered on an individual basis.

Categories of foreign employees in Cyprus for companies with foreign participation

In Cyprus, foreign-owned companies are entitled to employ foreign employees subject to a number of requirements, including a number of job categories. These categories are strictly regulated by the state authorities and have minimum salary levels and quotas for the number of employees to be hired. Depending on the level of responsibility, professional experience and specifics of the activity, all foreign employees are divided into four main categories.

Directors and senior management

This category includes senior executives who are involved in the strategic management of the company, making business development decisions, managing key operations, finances and human resources.

Who is included in the category:

• Chief Executive Officer (CEO)
• Chief Operating Officer (COO)
• Chief Financial Officer (CFO)
• Chief Operating Officer
• Members of the Board of Directors

Candidate Requirements:

• At least 5 years of experience in a managerial position
• Higher education in a relevant field (economics, management, finance, business administration, etc.)
• Proven managerial competencies and participation in the strategic development of the company
• Ability to work with international markets and knowledge of international corporate law is an advantage

Minimum salary:

The minimum salary level for employees in this category is at least €4,000 per month.

Quotas for the number of employees:

The company may employ up to 5 foreign professionals in this category. However, in exceptional cases, the quota may be increased if proven necessary.

Middle management and other key specialists

This category includes middle managers who have significant experience, the necessary professional knowledge and are able to manage individual departments or projects in the company.

Who is included in the category:

• Heads of departments (finance, marketing, HR, legal, IT and others)
• Middle managers
• Project managers
• Leading specialists with specialized qualifications.

Requirements for candidates:

• Experience in a relevant position from 3 years
• Higher education in specialty
• Certificates and licenses (if required for professional activity)
• Proficiency in English (or Greek) at working level

Minimum salary:

The minimum salary level for employees in this category is from €2,500 per month.

Quotas for the number of employees:

The maximum number of employees in this category in one company is up to 10 employees.

Specialists in key industries

This category includes specialists in areas of high demand in Cyprus such as IT, finance, pharmaceuticals, shipbuilding, engineering technology and others. Companies can attract foreign staff when there are not enough qualified local specialists.

Who falls into the category:

• Programmers and software developers
• System analysts
• Cybersecurity Engineers
• Pharmacists and biotechnologists
• Design engineers
• Shipbuilders and marine logistics specialists
• International accountants and auditors

Candidate Requirements:

• Experience of 2 years or more in a relevant field
• Higher technical or economic education
• International certificates and licenses (e.g. ACCA for accountants, CISSP for cybersecurity specialists)
• English language skills at B2 level and above

Minimum wage:

For this category of employees, the minimum salary is also set at between €2,500 per month.

Quotas for the number of employees:

Depends on the annual turnover of the company and its business activity. The following options are possible:

• Turnover less than 1 million euros – up to 5 specialists
• Turnover from 1 to 5 million euros – up to 50 specialists
• Turnover of more than 5 million euros – up to 200 specialists.

Support staff

This category includes employees who perform administrative and service functions. They are hired when no suitable specialists can be found among Cypriot or EU citizens.

Who is included in the category:

• Administrative assistants
• Office managers
• Logistics coordinators
• Secretaries
• Call-center operators
• Drivers and technical staff

Candidate Requirements:

• Minimum work experience of 1 year or more
• Proficiency in English or Greek (basic level)
• Secondary or higher education (depending on the position)

Minimum Salary:

The minimum salary for support staff is not strictly regulated, but it should be in line with the average salary in Cyprus for similar positions.

Quotas for the number of employees:

A company may hire employees in this category only after confirmation from the Department of Labor that there are no suitably qualified candidates available in the local labor market. In addition, the share of such employees in the total number of employees of the company must not exceed 30%.

Additional conditions for foreign employees

1. Spouses and families of employees
   • Spouses and children of employees who have obtained a work permit may also obtain a residence permit in Cyprus.
   • If an employee falls into the first three categories, his/her spouse is eligible for employment without further authorization.
2. Health Insurance and Taxes
   • All foreign employees must be insured by the Cyprus National Health System (GESY).
   • The employer is obliged to pay taxes and contributions to the Cyprus Social Fund.
3. Authorization procedure
   • After employment, the employee must apply to the Cyprus Migration Department for a temporary residence and work permit.
   • The permit is issued for a period of up to 3 years with the possibility of renewal

Procedure for obtaining a work permit and temporary residence in Cyprus for foreign employees of Cyprus companies with foreign participation

The procedure for obtaining a Temporary Residence and Employment Permit in Cyprus is regulated by the Civil Registration and Migration Department (CRMD) and involves several steps. The whole procedure, from application to issuance of the document, takes from 4 to 8 weeks, depending on the workload of the migration services and the completeness of the documents submitted

Step 1: Company registration and document preparation

Before a foreign employee can apply for a work permit, his employer (a Cypriot company) must meet the criteria for registration as a Business Facilitation Unit (BFU).

The main requirements for the company are:

• More than 50% of the share capital is owned by foreign investors (third country nationals)
• Physical office in Cyprus (it is not allowed to register a company at a residential address).
• The minimum capital deposited in the company’s account in a Cypriot bank is €200,000.
• Presence of active business activities in Cyprus

After confirming compliance with these criteria, the company is authorized to hire foreign employees.

Step 2: Obtaining an entry visa (if the employee is outside Cyprus)

If the foreign employee is not already in Cyprus, he/she needs to obtain a work visa (Category D) from the Cypriot Embassy or Consulate in his/her home country.

Documents for a Category D visa:

• Foreign passport (valid for at least 2 years)
• Original and copy of the employment contract signed by the employer
• Letter of invitation from a Cyprus company
• Certificate of no criminal record from the country of citizenship
• Proof of health insurance
• Medical tests (tuberculosis, hepatitis B and C, HIV)
• Proof of accommodation in Cyprus

After obtaining the visa, the employee can enter Cyprus and proceed with the legalization procedure.

Step 3: Registering at the Migration Department and applying for a temporary residence and work permit

Upon arrival in Cyprus, a foreigner must register with the Migration Department within 7 working days. The application for Temporary Residence and Employment Permit is submitted to the Civil Registry and Migration Department (CRMD) at the place of registration of the employer.

Required documents for application:

1. Completed MGEN application form (Form A or B depending on the type of position)
2. Passport (copy + original)
3. Valid Category D visa
4. Employment contract (with a minimum salary of 2,500 euros or more)
5. Letter from the employer justifying the employment of a foreign employee
6. Health insurance (GESY or private)
7. Blood tests (HIV, hepatitis B and C, tuberculosis)
8. Lease agreement or real estate ownership documents
9. Certificate of no criminal record from the country of citizenship, translated and certified by apostille

Upon submission of the documents, the applicant is issued with a Receipt for Submission of Application, which allows him/her to stay legally in Cyprus until the application is processed.

Step 4: Biometric registration

After submitting the application to the migration service, the employee must undergo biometric registration, which includes:

• Fingerprint scanning
• Photographing
• Signing the biometric data

Biometric registration is conducted at the CRMD or at the district migration offices (Nicosia, Limassol, Larnaca, Paphos, Famagusta).

Step 5: Waiting for a decision and receiving a resident card

The application process takes from 4 to 8 weeks. If all documents are submitted correctly, the applicant receives a Temporary Residence and Employment Permit, which is a plastic card with biometric data and is valid for 1-3 years.

After receiving the card, the employee receives an official employment permit and can reside in Cyprus for the duration of the document.

Step 6: Renewal of the permit

The permit can be renewed an unlimited number of times, provided that the employment relationship with the employer continues. The renewal procedure is similar to the initial application, but without the need to obtain a Category D visa again.

Additional aspects

1. Family members (spouses and children)
   • May obtain a residence permit
   • Spouses of staff in categories 1-3 are entitled to work without separate authorization
   • Children may attend schools in Cyprus
2. Health Insurance
   • All employees are required to be insured under the public GESY system or private health insurance.
3. Tax obligations
   • When an employee stays in Cyprus for more than 183 days per year, he/she becomes a tax resident
   • Income tax varies from 0% to 35% depending on the level of income.

Legislative analysis and comparative analysis

Cypriot legislation in the field of labor migration is aimed at creating favorable conditions for foreign investors and professionals. Unlike many other EU countries, Cyprus offers simplified procedures and minimal bureaucratic barriers for obtaining work and residence permits. For example, in Germany and France, the procedures for obtaining work permits for third country nationals are more complicated and require additional steps such as labor market checks and confirmation that there are no suitable candidates among the local population.

According to the Department of Civil Registration and Migration, 9,090 relocation applications from international companies have been received since the new business and talent attraction strategy came into effect in January 2022, of which 97% have already been processed.

Conclusion

Cyprus is successfully implementing a strategy to attract foreign investment and professionals by offering transparent and efficient mechanisms for obtaining work and temporary residence permits. Thanks to its favorable legislation and simplified procedures, the country is becoming an attractive destination for foreign-owned companies seeking to expand their presence in Europe.

AlmanovaLaw specialists have many years of experience in the field of Cyprus migration legislation and are ready to provide full legal support in obtaining work permits and temporary residence permits for foreign employees of Cyprus companies with foreign participation.

What services does AlmanovaLaw provide?

1. Compliance consulting
   • Analysis of the company structure and its compliance with the Business Facilitation Unit (BFU) criteria
   • Assessment of the possibility of obtaining permits for foreign employees
   • Preparation of recommendations for successful migration procedures
2. Document preparation
   • Drafting and verification of all required applications (including MGEN forms)
   • Translation and legalization of documents (including apostille of criminal record certificates)
   • Preparation of rental agreement or other documents confirming the applicant’s residence in Cyprus
3. Assistance in filing the application
   • Organizing the submission of documents to the Civil Registration and Migration Department (CRMD)
   • Enrollment for biometric registration
   • Tracking the status of the application and liaising with the migration authorities
4. Obtaining a work permit and residence permit
   • Accompanying the client until the Temporary Residence and Employment Permit is obtained
   • Assistance in registration of the employee with the tax and social services of Cyprus
   • Support in extending the permit
5. Additional services
   • Processing of Category D visa for entry
   • Registration of the applicant’s family members
   • Advice on tax residency and insurance issues

AlmanovaLaw specialists will help you avoid bureaucratic complications, save time and guarantee you a work and residence permit in Cyprus in accordance with the current legislation. Cooperating with our company, you get a personalized approach, full legal support and protection of your interests at all stages of document processing.

📞Contact us for advice and professional support!