28 August 2012

Part 1 : Introduction of Intellectual Property Regime for Cypriot Companies

Cyprus government has introduced an attractive Intellectual Property Law for Cypriot companies.

Significant changes to the law which now make Cyprus an attractive country for foreign investment are:

  •  The new law states an exemption on 80% of net profit from the exploitation of IP’s and profit on disposal of IP’s.
  •  The rate of capital allowances for any plant and machinery purchased in the tax years 2012, 2013 and 2014 has been set at 20%. Industrial   and hotel buildings purchased in the tax years 2012, 2013 and 2014, the capital allowances rate will be increased from 4% to 7%.
  •  Favourable changes to interest deductibility from net profit.

The meaning of patent rights and intellectual property (IP) rights has been amended to coincide with the definition in the Patent Rights Law of 1998, the Intellectual Property Law of 1976 and the Law regarding Trademarks. This ensures that all types of IPs will be covered by this new regime avoiding any uncertainty.

The following intangible assests and intellectual property rights are covered by the provision of the law:

  • Copyright
  • Patents
  • Trademarks
  • Computer software
  • Clientele database
  • Trade Secrets
  • Know how (private intellectual property)
  • Research and development activities

The tax law is effective from 1 January 2012.

For more information please contact an accountant at ServPRO.

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