Despite delays due to consultation between the competent authorities, the Cyprus partnership law has finally been amended by Law 144(I)/2015, which introduced the long-awaited partnership limited by shares. The law came into force in 2015 and brought Cyprus in line with other EU countries, including the United Kingdom, Poland and Luxembourg. In addition to the introduction of the partnership limited by shares, the maximum number of partners in any partnership has been revised to 100.

The introduction of partnerships limited by shares is expected to attract a significant number of investors from across the European Union; the vehicle is likely to be used in particular by Polish closed-end fund structures carrying out commercial transactions.

A partnership limited by shares can consist of one or more general partners (legal or natural persons) and one or more limited partners that can contribute capital towards the shares that they acquire in the partnership, but may not manage or operate it.

A partnership limited by shares acquires no legal personality (unlike a limited company, which by law acquires legal personality on incorporation). Further, a partnership limited by shares is tax transparent, so that any taxation arises at the level of partners. The amending law has also made it possible for alternative investment funds to be formed as limited liability partnerships.

For further information on this topic please contact Stella Koukounis at S Koukounis & Partners LLC - Solsidus Law by telephone (+357 99 415 708) or email (stella@skoukounislaw.com). The S Koukounis & Partners LLC - Solsidus Law website can be accessed at at www.solsiduslaw.com.

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