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Financial Participation

There are no specific regulations in the Cypriot legal system regarding employee ownership or profit-sharing schemes. All Cypriot companies are governed by Company Law, which contains no special rules regarding profit-sharing and only a vague reference to employee share ownership. Each company is free to decide upon giving share options to employees as part of incentive schemes.

 

 

There are no tax advantages specifically targeting employee shares.

 

Cooperatives are regulated by the ‘Law on Cooperatives’, which was revised in 2002 to conform with EU provisions. It stipulates that cooperatives can be registered either as limited liability companies or as unlimited liability companies. In both cases, the law makes it clear, however, that cooperative members cannot be held personally liable for the obligations of cooperatives. Only in the case of liquidation of a cooperative with unlimited liability can members be held personally liable. It is not laid down in law that employees of a cooperative also have to be members of the cooperative, although in practice this is often the case. Membership of a cooperative also gives access rights to specific loan facilities.1

Wilke, Maack and Partner (2014) Country reports on Financial Participation in Europe. Prepared for www.worker-participation.eu. Reports first published in 2007 and fully updated in 2014.