Investment Programme and Cambodian nationals

by | Oct 25, 2019 | Cyprus AML, Cyprus Investment Programme

On the 16th of October 2019, Reuters released a Special Report: Khmer Richer – How relatives and allies of Cambodia’s leader amassed wealth overseas. The special report outlines how family members of Cambodia’s long-ruling prime minister, Hun Sen, obtained European citizenship via the Cyprus Investment Programme.

More specifically the report mentions the niece and her husband, who is Cambodia’s national police chief who have invested in Cyprus and applied for citizenship.

The Special Report goes on to specify that Hun Kimleng became a citizen of Cyprus in 2016 and to criticize the policies which Cyprus adopts:

Cyprus seems less strict [Compared to the US placing the individuals on a Visa Blacklist]. In the confidential document, the Cypriot interior minister urges the cabinet to grant citizenship to Neth Savoeun and two grown-up daughters, and notes that they have never visited Cyprus.

The Cyprus Governments Response

As a response to the special report, the Cyprus Government announced that it would investigate the cases referred to in the media.

Current Prohibitions to the Cyprus Investment Programme

On the 25th of July 2019, the cabinet of ministers issued a new Cyprus Investment Programme prohibited person list which would aim to prohibit the granting of the Cyprus Citizenship to anyone falling within the criteria of the decision.

Although the prohibitions seem to be rough and quite restrictive they serve a key purpose.

They ensure that people who are internationally scrutinized, investigated, politically exposed and perform questionable actions will never qualify for the Cyprus Investment Programme.

They ensure that people who are internationally scrutinized, investigated, politically exposed and perform questionable actions will never qualify for the Cyprus Investment Programme.

Accordingly, if the prohibited persons to the Cyprus Investment Programme was introduced a few years ago the family members of Hun Sen would never have qualified for the Cyprus Investment Programme and neither would they have obtained the European citizenship.

[Update as of 7th of March 2020] The Cyprus government has promoted to parliament a proposed amendment to the  Civil Registry Laws of 2002-2019 which would see the possibility to strip Cyprus Citizens from citizens naturalized by investment in accordance with the Cyprus Investment Programme.

Harris Sharpe

Harris Sharpe

Author - Photographer

For many years he has worked and devoted his skills and efforts towards building a successful career as a leading executive. From humble beginnings, his aim has always been to yield results; with a keen focus to attention to detail and client satisfaction. His experience has always been varied and not specific, at times he preferred it. With that in mind, he has dealt with CySEC on licensing and ongoing regulation, international private equity and credit fund managers, NASDAQ and NYSE listed companies occasional millionaires as well as self-made millionaires. His passion though is difficult transaction work organizing and deploying people for a common goal. Harris enjoys reading and studying the Cyprus law and sharing that information on this website.

Publications on Cyprus Business Law

Cyprus Annual Return HE32 for Companies

Cyprus private companies limited by shares are required to prepare and submit to the registrar of companies an annual return HE32. The Cyprus annual return HE32 must be accompanied by (1) Audited Financial Statements (the “FS”) and (2) Declaration of the Director and Secretary (the “Declaration”) confirming that the FS submitted are those presented to the shareholder at an Annual General Meeting (“AGM”)

Cyprus Company Formation

A company is formed in Cyprus by way of law. The principal legal instrument giving such right is the Companies Law, Chapter 113 of the laws of the Republic of Cyprus, however the memorandum and articles play an equal important role in a Cyprus Company Formation. These two ‘constitutional’ documents are often called upon to deal with business matters of the Company and in other times to define the rights of the various parties.

Private Company Limited by Shares

A Cyprus Private Company Limited by shares is a class of private companies incorporated in accordance with the Cyprus Companies Law, Chapter 113 of the laws of the Republic of Cyprus. It is the most frequently used vehicle in Cyprus its numbers, statistics of the Registrar of Companies, being over 200.000 and on an annual basis around 14.000 new companies are incorporated every year.

Cyprus Registrar Forms legality issues and effect

Within the Companies Law, Chapter 113 of the Laws of the Republic of Cyprus the term “Prescribed Form” (καθορισµένο τύπο) which means the Cyprus Registrar Forms is mentioned several times. Although the Companies law requires information to be submitted in the Prescribed Form this does not create automatic legality of the said action (e.g. change of director) is not implied

Transfer of shares when is it effective?

In the case of Morsa Trading the district court held that a person becomes a registered member of a Cyprus company when that person’s name is registered in the register of members. Accordingly, the transfer of shares in a Cypriot Company requires, amongst other things, the registration in the register of members.

Company Migration to Cyprus

Migrating a company to Cyprus is not without its challenges, nevertheless if the foreign countries laws allow a company may redomicile and migrate to Cyprus. After which time it will be registered under the companies law.

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