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The Cypriot government has announced a comprehensive overhaul of its start-up visa program, aiming to solidify the island’s position as a leading hub for technology, innovation, and entrepreneurial activity. The updated framework, set to be implemented on January 1, 2025, introduces several pivotal changes to make Cyprus a more attractive destination for non-EU start-ups seeking to establish or relocate their businesses.
Key Changes to the Start-Up Visa Program
Extended Residence Permits
One of the most significant updates is the extension of residence permits for start-up founders and executives from outside the EU. The permits, previously valid for two years, will now be extended to three years. Furthermore, renewals will also be lengthened, increasing from one year to two years.
Lower Equity Stake Requirements
To lower barriers for entry and encourage diverse ownership structures, the required minimum equity stake for applicants has been reduced from 50% to 25%. This change is expected to benefit founders aiming to scale businesses while maintaining diverse equity distributions.
Increased Flexibility for Hiring Foreign Talent
The revamped program provides greater flexibility for start-ups in hiring foreign talent. The allowable percentage of foreign employees in start-ups has increased from 30% to 50%. Additionally, businesses investing at least €150,000 in Cyprus will be permitted to hire an even larger proportion of foreign personnel, a move expected to attract global talent to the island.
Enhanced Evaluation Criteria for Established Start-Ups
Tailored evaluation criteria have been introduced for mature ventures. Start-ups with annual revenues exceeding €1 million or those that have allocated at least 10% of their operating costs to research and development within the past three years will now qualify for specialized assessments. This shift aims to support more advanced businesses in their growth journey.
Rigorous Renewal Requirements
Start-ups seeking to renew their visas after the initial three-year period will need to meet robust performance benchmarks. These include demonstrating a 15% revenue growth or securing a minimum of €150,000 in investments. Additionally, start-ups must fulfill at least one of the following criteria:
Create at least three new jobs in Cyprus.
Participate in local innovation support programs.
Introduce at least one new product or service to the market.
To further align with the country’s emphasis on technological growth, employees of such start-ups will be required to possess basic digital skills, ensuring the workforce remains adept in a tech-driven economy.
A Strategic Vision for Innovation
Deputy Minister for Research, Innovation, and Digital Policy, Nicodemos Damianou, emphasized that the revamped program aligns with Cyprus’s overarching strategy to bolster its innovation and entrepreneurship ecosystem.
“This revamped program enhances Cyprus’s ability to attract talent, foster cutting-edge businesses, and create jobs, contributing to sustained economic growth,” Damianou stated during a recent press briefing.
The updates are designed to position Cyprus as a competitive destination for start-ups at every stage of development, from fledgling ventures to established, revenue-generating companies.
Economic Impact
The revised visa program forms part of Cyprus’s broader economic diversification strategy. By reducing its reliance on traditional sectors like tourism and real estate, the government is focusing on building a sustainable innovation-driven ecosystem. The shift is expected to enhance long-term economic resilience while contributing to global competitiveness.
In a landscape where countries like Portugal and Estonia are attracting entrepreneurs with programs such as the D7 visa and e-residency initiative, Cyprus aims to differentiate itself. The extended permits, relaxed equity requirements, and expanded opportunities for hiring international talent collectively make the new scheme an attractive option for start-ups worldwide.
Streamlining Relocation with Flexi Group
Navigating the complexities of international relocation and tax laws can be challenging for entrepreneurs. Flexi Group offers tailored services to facilitate seamless transitions to Cyprus. From securing residency to optimizing tax strategies and maximizing start-up benefits, Flexi Group provides comprehensive support for businesses and individuals.
For those looking to relocate to Cyprus, the updated start-up visa program provides an exciting opportunity to thrive in a dynamic, innovation-friendly environment. With strong government backing and a host of new incentives, Cyprus is set to become a magnet for global tech talent and entrepreneurial ventures.
*DISCLAIMER: This article and its publication are intended to provide a brief introduction and act as a general guide. This is provided for information purposes only and cannot be utilized as a substitute for professional advice. This document does not represent a legal opinion and one must not rely on it without receiving independent advice based on the particular facts of its own case. No responsibility is accepted by the author or the publishers for any loss suffered from acting or refraining from acting based on the contents of this publication.
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