Cyprus Shipping Limited Liability Company
Cyprus Shipping Limited Liability Company
The Shipping Limited Liability Company Law of 2022 (SLLC Law) was introduced in Cyprus in October 2022. Under the SLLC law a new ship-owning legal entity, the Shipping Limited Liability Company (SLLC) has been established, with sole business purpose the ownership and operation in relation to vessels under Cyprus Flag. The new SLLC Law creates a single framework specialised for Ship-owning companies with vessels under Cyprus flag and includes more simplified and straight – forward procedures in the day-to-day operations of the company.
Main Provisions of the SLLC Law
| Shipping Limited Liability Companies Law (161(1)/2022) | Companies Law (Cap. 113) |
| As defined in the SLLC law, “very small” SLLCs, are exempted from the obligation to publish their financial statements, whereas “small” SLLCs only publish their balance sheets. | Companies under Cap.113, are obligated to publish their financial statements. |
| The amendment of the Memorandum of the Company can be effected without the issuance of a court order, provided that certain conditions of the SLLC Law are met. | The amendment of the Memorandum of the Company requires a court order to effect such change. |
| The reduction of the SLLC’s share capital can be effected without the issuance of a court order, provided that certain conditions of the SLLC Law are met. | The reduction of the Company’s share capital requires a court order to effect such change. |
| There is a requirement for SLLC’s to only appoint lawyers for the position of Secretary. | There is no such requirement under Cap. 113 |
| A Register of SLLC has been created, and is supervised by the Deputy Ministry of Shipping (DMS) which also acts as the Registrar of Cyprus Vessels. The DMS will be responsible for the safekeeping of the SLLCs Register as well as the register of charges and/or mortgages. | The Registrar of Companies is the supervisory authority for business entities’ registration, maintenance of an updated business entities’ register and to monitor whether the business entities are complying with the Law. |
It is worth noting that all companies that own Cypriot vessels and are currently registered in the Registry of the Registrar of Cyprus Companies may apply to be transferred to the new SLLC Register, provided that some conditions are met.
The purpose of this legislation is to enhance and make the Cyprus flag more competitive and attractive in the international shipping industry. It also reduces administrative/court procedures by enabling electronic submissions and issuance of documents.
The Republic of Cyprus is a highly advantageous jurisdiction for shipping activities of many shipowners around the world. Cyprus has the 11th largest fleet in the world and the 3rd largest fleet in Europe, it also offers tax privileges and an excellent strategic location for base of operations.
For more information, please feel free to contact any member of our team or send your queries to [email protected]