Discussion begins on Thursday before the parliamentary interior committee on two bills by AKEL general secretary Stefanos Stefanou, which seek to impose controls on property acquisition by third-country foreign nationals to prevent uncontrolled property purchases, which in some cases occur through companies as a cover.
A significant provision bans the acquisition of forest or agricultural land and property adjacent to the ceasefire line.
The bills provide for the purchase of either one flat or one house and nothing more. At the same time, they prevent property acquisition by foreigners who hide behind companies.
Stefanou’s bills clarify that “a Cypriot and/or European company controlled by foreigners is not excluded from the definition of the term ‘foreigner’.”
Furthermore, provisions of existing legislation are abolished to close loopholes that allow the acquisition of large land areas by foreigners.
Property size limits
According to the AKEL general secretary’s bills, ministerial council approval will not be required for the acquisition of either one flat or one residence up to 200 square metres, or one office up to 300 square metres.
The same applies to companies controlled by foreigners.
The explanatory memorandum accompanying the bills states the purpose is to amend the Transfer and Mortgage of Immovable Property Law so that the director of the Department of Lands and Surveys cannot accept the transfer of immovable property or registration of a sale, exchange or assignment contract for immovable property when restrictions provided for in the Acquisition of Immovable Property (Aliens) Law apply.
The same memorandum also states that the proposed legislative arrangements are deemed necessary to strengthen legality controls on property acquisition by foreigners.
At the same time, they aim to prevent indirect property acquisition by foreigners through companies or assignment contracts, as well as secure transparency regarding the identity of beneficial owners of legal entities acquiring property in the Republic.
Key provisions
The bill’s provisions include the following:
Broadening the definition of “company controlled by foreigners” to also include any organisation in which the beneficial owner under the provisions of the Prevention and Suppression of Money Laundering Law is a foreigner.
Abolition of certain provisions of existing legislation which present gaps and interpretative ambiguities, namely, amongst others, those concerning acquisition of large land areas by foreigners.
Introduction of a provision under which ministerial council approval will not be required when property acquisition by a foreign natural person concerns acquisition of one flat or one residence up to 200 square metres, one shop up to 200 square metres or one office up to 300 square metres.
Introduction of a provision allowing a legal entity controlled by foreigners to acquire, without ministerial council approval, one shop up to 200 square metres or one office up to 300 square metres.
Prohibition of acquisition by foreigners of forest or agricultural land and immovable property adjacent to the ceasefire line or areas and/or critical infrastructure.
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