1. The Cross-border Merger Directive has been transposed into the Cypriot legal order by Law 186(I)/2007, which was published on 31 December 2007. That piece of legislation amended the Cypriot Companies Law, Chapter 113 (the ‘CCL’) by inserting a new section on cross-border mergers (Arts. 201I–201X CCL).
Scope of the new rules
2. The new section applies to cross-border mergers of limited liability companies under the conditions that (i) at least one of the merging limited liability companies is a Cypriot company or the limited liability company resulting from the cross-border merger is a Cypriot company (Art. 201J(1) CCL), and (ii) at least one of the rest of the participating companies is subject to the jurisdiction of another European Economic Area Member State (Art. 201I CCL).
Cross-border mergers are only possible between types of limited liability companies which may merge under the national law of the relevant Member States. Every Cypriot company may take part in a cross-border merger except (i) the limited liability companies by guarantee, and (ii) the companies subject to liquidation. A Cypriot company participating in such a merger must comply with the provisions and formalities of the CCL (Art. 201K CCL).
It is worth noting that the Cyprus legislature chose not to exercise the option given by Article 3(2) of the Cross-border Merger Directive and therefore the new rules are applicable to cooperative societies falling within the definition of ‘limited liability company’ as laid down in Article 201I of the CCL.