As a result of the adoption of the Euro in Cyprus from the 1st of January 2008 pursuant to "The Adoption of the Euro Law of 2007", the share capital of a limited liability company either by guarantee or by shares, which is denominated in Cyprus pounds should be converted and rounded into Euro.

The Company must register the relevant resolution with the Department of the Official Receiver and Registrar of Companies within the period from 1/1/2008 to 31/12/2008.

The resolution must refer to the conversion of the share capital and the way the resulting increase / reduction is dealt with (capitalisation of reserves, payment of cash etc). In case the Memorandum and Articles of Association refer to the share capital, the resolution must also refer to the Memorandum and Article's amendment.

It must be noted that as of 1 January 2008 no amendment to the Company's Memorandum and Articles of Association or any other change in the Company's information can be registered with the Department of the Official Receiver and Registrar of Companies unless the Company files the resolution for the conversion to Euro.

During the period form 1/1/2008 to 31/12/2008 the requirements of the Cyprus Companies Law Cap. 113 for increase or reduction of capital do not apply to such changes resulting from the conversion to the Euro.

In case no registration takes place within the abovementioned period then the relevant provisions of Cap. 113 shall apply and it is highly possible an application to the Court to be required.

We strongly recommend our clientele to proceed as soon as possible with the conversion of their Company's share capital due to the fact that within this period the Department of the Official Receiver and Registrar of Companies does not charge any fees relating to conversion of the nominal share capital.

Our office can prepare on your behalf all the relevant documents and make the necessary arrangements with the Department of the Official Receiver and Registrar of Companies in order for the conversion of the nominal share capital to be affected.

In case you want to instruct us to act on your behalf please contact our office at 23811810 or complete the following form and send it to us via e-mail at info@klztlaw.com.

Example of conversion of share capital

Issued share capital CYP1.000, consisting of 1.000 shares with nominal value of CYP1 per share. It must be noted that it is the nominal value per share that is converted and rounded and not the total amount of share capital.

The irrevocably conversion rate between the Cyprus Pound and the Euro is set at: €1=CYP0,585274. The conversion of Cyprus pounds into Euro is done by dividing the relevant amount in Cyprus fixed conversion rate, using all the six decimal digits of the conversion rate. The amount of Euro resulting from the conversion is rounded to two decimal places (to the nearest cent). The amount is rounded downwards when the third decimal is 4 or less and upwards when the third decimal is 5 or greater.

Conversion from Cyprus Pounds to Euro:

• Conversion of nominal value per share: CYP1 / 0,585274 = €1,708601
• Rounding of nominal value per share to two decimal places: €1,71
• Total amount of share capital in Euro: 1,000 shares @ €1,71 = €1,710
• Calculation of divergence due to the conversion:
• Total amount of share capital in Euro (before conversion of nominal value per share): CYP1,000 / 0,585274 = €1708,86
• Total amount of share capital in Euro (after conversion of nominal value per share): €1,710

In this example Share capital need to be increased by €1,14 (€1,710 - €1708,86).

According to the "The Adoption of the Euro Law of 2007" the increase of the share capital may be achieved by the capitalization of reserves or the payment of cash.