Bill Proposes Blocking Company Registrations on National Security Grounds
In response to growing national security concerns, officials have proposed new legislation aimed at restricting company registrations. The focus is predominantly on entities controlled by non-European Union nationals, particularly those linked to Turkish nationals.
Legislative Initiative on Company Registrations
On Thursday, officials revealed they are working to empower authorities to block company registrations under specific national security grounds. This move is crucial, especially given the transparency issues related to ultimate beneficial owners (UBOs) from Turkey.
Concerns Over National Security
Edek MP Marinos Sizopoulos highlighted two significant issues related to this legislation. Firstly, the risk of espionage due to foreign ownership. Secondly, there are fears regarding the acquisition of real estate by businesses with Turkish interests.
Role of the Registrar of Companies
Irini Mylona-Chrysostomou, the Registrar of Companies, confirmed that there have been ongoing attempts by individuals with Turkish interests to set up companies in the Republic. The Registrar collaborates with district officers to ensure the legitimacy of these registrations.
Mandatory Disclosure and Compliance
Under current regulations, Turkish nationals who serve as UBOs in registered companies must disclose their ownership in the central Register of Beneficial Owners. This requirement aligns with EU Anti-Money Laundering directives, which mandate the identification of individuals holding more than 25% of shares or voting rights.
Pending Legislative Changes
Officials from the attorney-general’s office are reviewing two drafted bills from the government. The first bill pertains to corporations, while the second targets partnerships. These proposals aim to regulate company registrations, transfers to other jurisdictions, and associated official changes.
- New legislation aims to strengthen national security measures.
- It seeks to block registrations of companies linked to non-EU nationals.
- Legislation expected to be submitted before parliamentary elections in April.
Real Estate Acquisition by Foreign Nationals
Concerns are also raised about the mass acquisition of land by foreign nationals. Recently, the Diko MP Zacharias Koulias stated that this issue has been “unchecked” and called for quick legislative action to safeguard national interests.
Akel MP Christos Christofides warned of the threats posed by the increasing real estate purchases made by non-EU owners. Reports indicate a growing trend of foreign nationals acquiring properties in strategic locations, including near airports and military facilities.
Outdated Property Acquisition Laws
Current laws governing property acquisition by foreign nationals are considered outdated and filled with loopholes. A report from the auditor-general revealed that non-EU nationals, including Lebanese, Israelis, Russians, and Chinese, have made significant real estate purchases, accounting for over 25% of all property sales in 2024.
This pattern of property acquisition by non-EU entities poses a pressing challenge for local authorities. Immediate legislative adjustments are necessary to address these national security concerns effectively and protect the country’s sovereignty.
