CYPRUS Trends and Developments Contributed by: Ioanna Solomou, Stephanos Ayiomamitis and Andria Kouloumi, Michael Kyprianou & Co LLC
sion on whether to approve, condition or prohibit an investment remains with the Cypriot authorities, they are required to take into account any relevant input received through the EU co-operation process. This co-ordinated approach enhances the over - all effectiveness of FDI screening across the Union, particularly in cases involving complex or multi-juris - dictional investments. It also contributes to a more consistent application of screening principles, while preserving the sovereignty of member states in deci - sion-making. Concluding remarks The introduction of Law 194 (I)/2025 marks a signifi - cant milestone in the evolution of Cyprus’s regulatory framework for foreign investment. By establishing a structured and comprehensive screening mecha - nism, Cyprus aligns itself with international trends and strengthens its capacity to address emerging risks.
The incorporation of detailed criteria under Article 3 and enhanced disclosure requirements under Article 4 ensures that the regime is both targeted and effec - tive. At the same time, the flexibility afforded to the Screening Authority allows for a proportionate and case-by-case assessment of investments. Looking ahead, the successful implementation of the regime will depend on the development of clear administrative practices and guidance, as well as the ability of market participants to adapt to the new requirements. For investors and advisers alike, early engagement with the framework will be essential to ensure compliance and to facilitate efficient transac - tion execution. Ultimately, the new FDI screening regime reflects a broader policy objective: to maintain Cyprus as an attractive destination for foreign investment, while safeguarding its security, public order and strategic interests in an increasingly complex global environ - ment.
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