CYPRUS Law and Practice Contributed by: Menelaos Kyprianou, Constantina Zantira, Andreas Lytras and Eleana Poulladou, Michael Kyprianou & Co LLC
• mediation; • conciliation; and • expert determination. 4.2 Requirements to Engage in ADR
• the complexity of the legal issues raised; • the urgency of the matter; • their expertise in that particular field; and • the possibility that they may be restricted from undertaking other legal work or clients. In any case, the legal fees charged must be just and reasonable under the circumstances. 5.2 Third-Party Funding Third-party funding is not governed by any legislation in Cyprus. However, in a recent judgment, dated 5 March 2026, the Court of Appeal held that third-party funding is not prohibited, provided that it is made in good faith and that it is not contrary to public policy. An agreement for third-party funding may be contrary to public policy if it is made, for example, with the purpose of advancing unnecessary or abusive claims or where its content is illegal or unethical. 5.3 Contingency Fee Arrangement Contingency fee arrangements are generally not per- According to the Law on Insurance and Reinsurance and other Related Matters of 2016 (Law 38 (I)/2016), insurance coverage is available for litigation regarding both civil and criminal proceedings and for out-of- court settlements. However, it is uncertain that insur- ance coverage is available for arbitration and ADR since Law 38 (I)/2016 is silent in this respect. 5.5 Costs The general rule is that the losing party is ordered to pay the costs of the winning party. Nevertheless, the court has a wide discretion in awarding costs in a different manner as the court may deem appropriate under the circumstances, including an order that each party bears its own costs, or that one party pays only a specific amount of the other party’s costs, or costs incurred only after or until a specific date or before the filing of the proceedings or only in relation to a specific part of the proceedings. 5.6 Assessment of Costs In making an order as to the costs of the proceedings, apart from the aforementioned general rule, the court mitted in Cyprus. 5.4 Insurance
There is no general obligation to engage in ADR, although the courts may encourage it. A refusal to consider ADR may be taken into account in costs. 4.3 Impact of ADR Participation in ADR does not, in itself, affect a party’s right to litigate or arbitrate, unless there is a contrac- tual requirement to do so. 4.4 Timing of ADR ADR may take place at any stage of a dispute. As a general rule, it does not suspend limitation periods. 4.5 Confidentiality Mediation and similar ADR processes are generally treated as confidential. 4.6 Costs Costs are usually shared between the parties, unless otherwise agreed. 4.7 Courts and ADR The courts are generally supportive of ADR and may encourage parties to explore settlement. Appendix B of the Civil Procedure Rules provides for a range of legal fees that may be charged in civil cases according to the size of the claim. Lawyers may charge legal fees according to the said Appendix B or make a different agreement with their clients. Indeed, many lawyers charge their fees on an hourly basis or agree a fixed fee for a particular legal work. The Advocates’ Code of Conduct provides that a lawyer should take into account a number of factors, including, inter alia: • the time needed to carry out a particular work; • the financial situation of their client; 5. Costs, Fees and Funding 5.1 Legal Fees
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