CYPRUS Law and Practice Contributed by: Alexis Erotocritou, Dafni Loizou and Georgia Demou, A.G. Erotocritou LLC
• The management of the property interests of a minor is exercised by both parents, or the sole sur - viving parent. In the case of death of both parents and/or in case where the surviving parents lack the capacity to exercise the parental care of the minor and/or in the event that the court decided to remove the duty of parental care from the parents, a guardian is appointed by the court who under - takes the task of managing the property of the minor. • Guardianship (court supervision): the court may appoint a guardian for minors, as explained above, or adults lacking capacity. The guardian manages personal and financial affairs under judicial over - sight. However, it is very bureaucratic and less flexible than trust-based planning. • Public law disability protections: Cyprus has a strong rights-based disability framework (National Action Plan on Disability, EU-aligned policies). These ensure access to services, education, and social support, but do not create a private wealth- management structure 8.2 Appointment of a Guardian Any appointment of a financial guardian requires a court order, and the guardian’s management of money or property is continuously supervised by the court. • Court appointment is mandatory: a District Court must appoint a judicial guardian before anyone can legally manage a minor’s or incapacitated adult’s bank accounts, property, investments, or business interests. • Strict financial oversight: the guardian must (i) submit regular financial reports and account state - ments, (ii) obtain court approval for major trans - actions (sale of property, investment decisions, withdrawals etc), (iii) act under continuous judicial monitoring to prevent misuse of assets. • Criteria and exclusions: the court evaluates the proposed guardian’s financial competence, integ - rity, and absence of conflicts of interest. Persons with financial misconduct, or conflicting personal interests are typically excluded. • Why families avoid guardianship for financial matters: because the system is bureaucratic and heavily supervised, families often use CITs to man -
age assets for minors or vulnerable adults without ongoing court control. 8.3 Planning for Incapacity Cyprus has no lasting power of attorney (PoA). Ordi - nary PoAs end once the person loses capacity so they cannot be used for long-term incapacity planning. To legally plan for future mental incapacity, residents use court-appointed administration governed by Adminis - tration of Property of Incapacitated Persons Law (Law 23 (I)/1996) and trust structures. • Incapacity: formal mechanism is a court-appointed administrator/guardian to manage the person’s property, bank accounts, and financial affairs. Appointment requires medical evidence, and the administrator is under strict court supervision (reg - ular accounts, approvals for major transactions). • Use of CITs: families use CITs to ensure a continu - ous financial management without court involve - ment. 8.4 Elder Law Families prepare financially for longer lives through three main pillars. • Pensions and savings: occupational and private pension schemes, plus tax advantaged retirement and life insurance products, are increasingly used. • CITs: promoted and used as a long-term wealth structuring tool to ring-fence assets, fund future care, and preserve family wealth across genera - tions. • Intergenerational planning: lifetime gifts and family holding structures are common, facilitated by the absence of inheritance and gift tax, allowing assets to be positioned in advance for multi-generational support. 9. Planning for Non-Traditional Families 9.1 Children In Cyprus, children born out of wedlock are viewed and treated as if they were children born into a valid marriage. Once paternity is established, they have full inheritance rights from both parents. Likewise adopt - ed children have the same inheritance and succes -
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