One is a new legal person. The other is your own company, standing here

In short

  • A Cyprus company is a separate legal person. Its debts are its own.
  • A branch is not separate. It is the foreign company itself, registered as carrying on business here, and the foreign company answers for everything the branch does.
  • The registration burden is comparable. The exposure is not.

The question arrives in almost the same words every time: we already have a company at home, do we open a Cyprus company or just register a branch here. The answer turns on one distinction that is easy to state and expensive to get wrong. Incorporating in Cyprus creates a new legal person, which owns its own assets, owes its own debts and is sued in its own name. Registering a branch creates nothing. It records that an existing foreign company has established a place of business in the Republic, and every obligation the branch takes on is an obligation of that foreign company.

Everything else, the filings, the accounts, the name on the door, follows from that. This page sets out what each choice actually requires, with the provisions that impose each requirement, so the decision is made on the law rather than on what is quickest to arrange.

Which one fits what you are doing

Tell us what the Cyprus operation will do, who will contract with whom, and where the money will sit. We reply within one business day with the structure we would put in place and what it costs. Email office@kleanthousplatis.com or call +357 22 680 330.

The difference that decides it

Liability does not stop at the branch

A company incorporated under the Companies Law, Cap. 113, exists apart from the people who own it. A creditor of that company looks to that company. If the venture fails, what is lost is what was put in, unless someone has given a guarantee or the conduct of the directors opens a separate door.

A branch has no such wall. The Law treats the foreign company as the party carrying on business here: sections 347 to 353 of Cap. 113 apply, by section 346, to companies incorporated outside the Republic which establish a place of business within it. A supplier who is not paid by the branch sues the foreign company. A judgment against the branch is a judgment against the foreign company, enforceable against its assets wherever the rules of that country allow.

That is the whole of it. Where the Cyprus activity carries real commercial risk, a separate company is usually the honest answer. Where the activity is an extension of the parent that the parent is content to stand behind anyway, a branch may be perfectly sensible.

What the Registrar requires from a branch

One month, and a named person here

Section 347(1) gives a foreign company one month from establishing its place of business to deliver to the Registrar of Companies, in the prescribed form:

  • A written statement giving the company's name and legal form, and the name of the place of business if it differs; the seat and address of the company and the address of the place of business; the purpose and business of both; the foreign register and registration number where there is one; the issued capital where there is one; particulars of any dissolution, liquidator or insolvency procedure affecting the company; and, for a company from outside the European Union, the law governing it.
  • A certified copy of the charter, statutes or memorandum and articles, with every amendment, and a certified translation where the document is not in English.
  • A list of the directors and the secretary, and of everyone authorised to represent the company and the place of business in dealings with third parties and before the courts and the authorities, with the particulars section 347(2) requires for each of them.
  • The names and addresses of one or more persons resident in the Republic authorised to accept service of legal documents and notices on the company's behalf.

The last of those is not administrative detail. Under section 352, service on the person named, at the address given, is good service on the foreign company. Where no such person has been delivered to the Registrar, the Law provides for service another way, which is worse for the company because it is out of its hands.

What a branch keeps doing

The obligations do not end at registration

Section 349 requires a report to the Registrar whenever the documents or particulars already delivered change. Section 350 requires the foreign company to deliver, in each financial year, copies of the financial statements, the management report and the auditors' report which it laid before its own last general meeting and published under the law of the state where it was incorporated, with an exemption for companies of certain member states in the terms the section sets out.

Section 351 governs how the company presents itself: it must state the country of incorporation in any invitation to subscribe for its shares or debentures in the Republic, display its name and country of incorporation conspicuously at every place where it carries on business here, and give both, legibly, on its letterhead, invoices and business correspondence.

Section 353 makes failure an offence for the company and for any officer or agent who knowingly and wilfully authorises or permits it, with a continuing penalty for each day it goes on. The figures in the consolidated text are still expressed in pounds, which tells you how long the section has stood.

One provision is not yet operative. Section 347(1A), which has the Registrar certify that the foreign company has established a place of business, comes into force on a date the Registrar is to notify in the Official Gazette under section 13 of Law 155(I)/2025. Until that notification, it does not apply.

Tax is a separate question

Where the company is managed, not where it is registered

Choosing a company over a branch does not by itself decide where profits are taxed, and it is a mistake to reason as though it did. Cyprus taxes companies by reference to residence under the Income Tax Law, Law 118(I)/2002, and residence turns on where management and control are exercised, which is judged on the whole picture: where the board actually meets and decides, where the records are kept, who takes the decisions that matter.

A Cyprus company whose decisions are all taken abroad and a branch whose decisions are all taken here can each end up somewhere the founder did not expect. The structure and the tax position have to be designed together, with an accountant in the room, and neither this page nor any page can do that from a distance.

Choosing between them

What usually decides it in practice

A separate Cyprus company tends to be right where the Cyprus activity will contract in its own name, take on credit, employ people, hold assets or carry risk the parent would rather not own directly; where an investor, a partner or a lender will want to take shares or security in a Cyprus vehicle; and where the parent may one day want to sell the Cyprus business rather than wind it down.

A branch tends to be right where the activity is genuinely an extension of the parent, where the parent will be contracting anyway and is content to be the named party, and where keeping one balance sheet is worth more than the separation.

Two practical points are worth weighing before the decision hardens. A branch publishes the parent's accounts here under section 350, which some groups do not expect and would not choose. And a branch cannot be sold as a company can: what a buyer buys is assets, not shares.

What this page is not

Where the answer stops being general

This sets out the legal difference and the filings each choice brings. It does not decide your case. The choice interacts with the tax position of the group, with any regulatory permission the activity needs, and with what your counterparties will accept as the contracting party, and those are answered on the documents and not in the abstract.

If you are forming the Cyprus company, the structure conversation is set out under company formation. If the company already exists and you need an address and statutory housekeeping, that is registered office. If you need someone here to accept service, that is a process agent, which is a narrower appointment than the person a branch must name under section 347(1).

Common questions

Asked before the decision is made

Is a branch cheaper to set up than a company?

Not by as much as people assume. The branch has to deliver constitutional documents, certified translations where they are not in English, a list of directors, secretary and authorised representatives, and a person here to accept service, all within a month under section 347(1), and it then files the parent's accounts every year under section 350. The saving is real but modest, and it is bought with the parent's liability.

Can a branch be converted into a Cyprus company later?

Not by conversion. The company is incorporated and the business is transferred to it, which is a transaction with its own contracts, consents and, where employees are involved, its own protections. It is done regularly and it is easier decided at the start than unwound later.

Does a branch need a Cyprus resident director?

A branch has no directors of its own: it has the foreign company's directors. What section 347(1) requires here is one or more persons resident in the Republic authorised to accept service. Where a group wants Cyprus management and control for tax reasons, that is an argument for a company with a real board here, not for a branch.

Which one do our customers contract with?

With a company, the Cyprus company itself, and its balance sheet is what the counterparty is looking at. With a branch, the foreign company, whatever the letterhead says, which is why section 351 requires the name and country of incorporation to appear on it. Counterparties who care about who they are dealing with usually prefer the honesty of a company.

We only want an address and a presence, not an operation.

Then neither may be the right instrument. A place of business is what triggers the branch obligations in the first place, and registering one you do not need buys filings without benefit. Say what the presence is for and the answer is usually simpler than either.

Written on this subject

Substance in a Cyprus Company

Corporate

Directors' Duties Under Cyprus Law

Corporate

When a UK Company Needs an EU Representative

Corporate

All our writing is on the writing index. Related: Corporate & Commercial, Company Formation and Registered Office.

Before instructing, send us what the Cyprus operation will do and who will be contracting, and we will tell you which of the two we would use and why.

Request a consultation

Tell us briefly how we may assist

A few sentences is enough: what the company does, who the parties are, and any date by which it has to be in place. We reply within one business day. Please do not send confidential documents until we confirm we can act.

Request a consultation

Or write to us directly at office@kleanthousplatis.com, or call +357 22 680 330.