CYPRUS Law and Practice Contributed by: George Middleton, Christoforos Iosif and Michalis Kramvis, Chryssafinis & Polyviou LLC
2.13 Holding Through a Nominee A company is only obliged to recognise as its share- holders the person or persons whose names appear in the company’s register of members as the holders of the company’s shares. If shares are held through nominees, the company shall only be obliged to notify/provide information to the nominee that is its registered shareholder and not to the nominee’s prin- cipal. Moreover, only the nominee or its proxy (but not the principal) can be validly represented and vote at a general meeting. 2.14 Written Resolutions It is possible for the shareholders to pass a written resolution if doing so is allowed by the company’s articles of association. The written resolution will need to be signed by all the shareholders of the company. 3. Share Issues, Share Transfers and Disclosure of Shareholders’ Interests 3.1 Share Issues Pre-emption rights for existing shareholders are only obligatory by law for public companies; for private companies they are only obligatory if specifically pro- vided for in the company’s articles of association. 3.2 Share Transfers A private company may never acquire its own shares, while a public company may acquire its own shares under strict conditions. A private company may pro- vide financial assistance in connection with the acqui- sition of its own shares by a person, provided that such financial assistance is approved by at least 90% of the shares comprising its issued share capital. 3.3 Security Over Shares Shareholders can grant security interests over their shares. The basic types of security that can be grant- ed over shares are pledges on share certificates, charges, assignments of rights and liens. The right to grant security over share certificates and shares may be restricted by a company’s articles of association. 3.4 Disclosure of Interests Unless the company’s articles of association include provisions entitling the company to request its share-
holders to disclose their interest, the shareholders are under no obligation to do so. Shareholders are required to disclose the details of their ultimate beneficial owner(s) to the Department of Registrar of Companies. Any transfer or issuance of new shares needs to be recorded in the company’s registry of shareholders, in order to be legally effective. A company’s registry of shareholders is open for inspection. Every issuance of new shares and, with respect to private companies, every transfer of shares needs to be notified to the Department of Registrar of Compa- nies, which maintains a publicly accessible registry containing the information of each company that has been notified to it. In general, a shareholder does not have an obliga- tion under the Cypriot Companies Law to notify any changes in its shareholding to a regulatory authority. Such obligation may arise if the company is a pub- lic company listed on a stock exchange and/or is an entity regulated by specific legislation (credit institu- tion, investment company, insurance company, etc). 4. Cancellation and Buybacks of Shares 4.1 Cancellation A company may cancel shares forming part of its issued share capital in the following circumstances: • if said shares were issued as redeemable shares and the conditions for their redemptions have been satisfied; • as part of a capital reduction sanctioned by the court; and • as part of a scheme of arrangement sanctioned by the court. Public companies may also proceed with the cancel- lation of shares acquired by them following the imple- mentation of a buyback programme in accordance with the provisions of the law.
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