On the 6th of October 2022, the house of representative approved the Limited Liability Shipping Company Law of 2022 (the “SLLC Law”), taking one step closer to the implementation of the national strategy for Cyprus Shipping “SEA Change 2030”.
The new Law is certainly inspired by the Companies Law (CAP. 113), creating a new type of corporate entity (limited liability company or the SLLC), under the designation of Shipping Limited Liability Company – exclusively limited to the ownership and operation of Cypriot Ships.
Main Differences between the SLLC Law and CAP.113:
SLLC Law, includes various provisions aiming to simplify procedures and to make the establishment of an SLLC more flexible and attractive.
1. An important provision and one of the main differences with CAP.113 is the requirement for SLLCs’ secretary to be a lawyer and to effectively perform such duties pursuant to the provisions of the Law (Article 79 (1)).
2. An SLLC is not required to obtain a court order for the reduction of its share capital.
3. The Memorandum can only be amended, without a court order, to reflect the increase or reductio of its share capital.
A Register of SLLC will be created and will be supervised by the Deputy Ministry of Shipping, aiming to simplify all procedures and aspects.
Transferring of a limited liability company to an SLLC:
Any company owning a Cypriot registered ship, already registered in the existing Cyprus Companies Register will be able to request transfer to the new SLLC Register, subject to certain conditions (Article 104).
1. Special resolution of the shareholders approving such registration/transfer.
2. Revision of the M&AoA to comply with the SLLC Law.
3. Provision of the applicant’s corporate certificates.
4. Provision of evidence of any registered charges.
5. Written consent of the applicant’s creditors, if any.
6. Written confirmation from the Registrar of Companies that the applicant has paid all applicable fees.
The ultimate aim of this new Law is to create a one-stop-shop framework for ship-owning companies and their shareholders.
Further guidelines will be given by the Deputy Ministry of Shipping in due course.
HOW WE CAN HELP:
1. Assist and advise on matters related to the SLLC Law.
2. Assist and advise on the establishment and registration of an SLLC.
3. Acting as the SLLCs Secretary.
4. Assist and advise on the registration of the Vessels into the Cyprus Flag.
5. Handling of the transferring of companies to the SLLC Registry.
This article is written for information purposes only and it does not constitute legal advice.
For further information, legal advice and assistance please contact us at zena@zsm.law.