Cyprus will introduce a Foreign Direct Investment (FDI) Screening Law, effective 2 April 2026, requiring foreign investors to obtain prior approval for investments in strategic sectors. This new framework marks a significant development for investors considering transactions in Cypriot entities.
Under the law, foreign investors acquiring 25% or more of shares in a Cypriot entity valued at €2 million or above must submit a notification for approval. Any subsequent stake increases to 25% or 50% also trigger a filing requirement. Non-notified transactions may be reviewed for up to five years after completion, highlighting the importance of early planning. The initial screening phase takes around 20 working days, with a Phase 2 review extending up to 95 days if further scrutiny is required. The law applies to critical sectors including energy, transport, defence, cybersecurity and biotechnology. Investors should also consider EU rules, such as merger control and the Foreign Subsidies Regulation, when structuring cross-border deals. This legislation aligns Cyprus with broader European trends in strengthening oversight of foreign investment in sensitive industries. The FDI screening framework introduces new compliance considerations for foreign investors. Early identification of filing requirements is essential to avoid delays or regulatory risks. Transaction timelines and risk allocation may need review.
Eurofast can assist clients by assessing whether a transaction falls within the law’s scope, managing notification procedures, and coordinating with other regulatory requirements. Our teams guide investors through the process, ensuring compliance, efficiency, and strategic planning.
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