Intellectual-property-rights

The necessity for protection of IP rights

The protection of IP rights and Intellectual property in general has nowadays become a necessity, especially due to the ever growing development of technology, the impairment of all kind of barriers and of course the constant development of businesses and worldwide transactions.

As a result, an international business proceeds to protect all of its IP rights, such as the registration of its Trademark or Trademarks internationally or the registration of its patents and in general, its Intellectual Property of any kind.

The main reason that such companies seek to protect their Intellectual Property, is to ensure that the consumers will not confuse the said company or its services with any other competitor or any other business in general. The combination therefore of the company’s turnover and fame, simply adds to the value of its Intellectual Property.

However, such a situation could have dangerous results and consequences to any small business or company which is located in any given country. The reason for that lies in the simple principles which govern the Law on Intellectual Property.

Essentially, in order for a Trademark to be registrable, certain requirements need to be fulfilled. First of all, the mark should be distinctive, secondly it must not be similar to an already registered mark and thirdly it must not be able to cause confusion to consumers.

The danger that a business faces when using a non-registered Trademark is that of the Infringement of Intellectual Property Rights, which is a civil offense.

This danger becomes more realistic on the basis that if a company uses a mark which is similar to the registered mark of another company, that, is considered as Infringement of the IP rights of the company who is the owner of the mark. Any such infringement grants the owner of the infringed mark the right to request damages through legal proceedings.

Therefore, it is advisable for any given company to protect its IP Rights so as to avoid the possibility of infringing the IP rights of another company but also to protect itself from others infringing the said company’s own IP rights.

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cyprus-iran-sign-double-tax-treaty

Cyprus and Iran sign double tax treaty

Cyprus and Iran have concluded a Double Taxation Treaty agreement, allowing for the avoidance of double taxation and fiscal evasion in relation to taxes on income between the two countries.

The Finance Ministry affirmed on Tuesday that this development will contribute to the development of trade and economic relations between the Republic of Cyprus and the Islamic Republic of Iran, as well as with other countries.

Following the signing, Minister of Finance Harris Georgiades stated “It is with great pleasure that we signed this very important agreement which will pave the way for the expansion of business and investment opportunities between Iran and Cyprus,”

He went on to say that the time was right for such a strategic agreement between the states, following the historic Iranian nuclear agreement several weeks ago, which has created the appropriate conditions upon which to build trust between Iran and the international community.

Georgiades continued by saying that “Cyprus, through its EU membership is offering its full support to this agreement and is ready to be part of this new beginning. In fact, Cyprus, being a credible international business centre, is well-suited to act as a bridge between Iran and the European and global markets,”

Iranian deputy Finance Minister Dr. Ali Asgari also expressed his approval of this agreement being Iran’s 48th DTT, and Cyprus’ 58th.

Speaking through an interpreter, Dr. Asgari mentioned that this agreement established a platform through which relations between the countries may be developed, to the mutual benefit of both.

The position held is that the expansion and upgrade of the island’s network of Double Taxation Agreements is of high economic and political importance, and aims to attract foreign investment as well as further strengthen existing investment so as to elevate Cyprus’ position as an international business centre (IBC).

What-is-Fatca-Logo

What is FATCA – The FATCA Definition

Foreign Accounts Tax Compliance Act

In March 2010, the provisions commonly known as the Foreign Account Tax Compliance Act (FATCA), became law in the United States of America. FATCA targets tax non-compliance by U.S. taxpayers with foreign accounts and focuses on reporting:

  • By U.S. taxpayers about certain foreign financial accounts and offshore assets.
  • By foreign financial institutions about financial accounts held by U.S. taxpayers or foreign entities in which US taxpayers hold a substantial ownership interest.

FATCA was enacted to prevent and detect offshore tax evasion. Based on the name and a quick reading of the rules, FATCA seems to be directed at financial institutions. Therefore, many global companies outside the financial services industry mistakenly believe that they are not affected. However, upon closer review, many realize the surprising fact that they have entities in their worldwide network falling under the purview of FATCA, or have operational areas that make or receive payments subject to FATCA.

What FACTA means for individuals that maintain financial accounts in Cyprus?

1. What information will my financial institution use to identify whether I could be subject to reporting? You may be contacted by your financial institution if one or more of the following indicia apply to you:

  • You have U.S citizenship or lawful permanent resident (green card) status
  • U.S birthplace
  • You have a U.S residence address or a U.S. correspondence address (including a U.S P.O box)
  • You have a telephone number in the U.S.
  • You repeat payment instructions to pay amounts to a U.S address or an account maintained in the U.S
  • You have granted a power of attorney to a person with a U.S. address
  • You have an In-Care-Of or Hold-Mail address in the United States that is the sole address submitted to your institution

2. Will I be required to provide any additional information to my Cyprus financial institution in order to comply with FATCA provisions?

You might be asked about your tax residency status in connection with your existing accounts (if there is information associated with your account that suggests you may be a U.S. person) or when you open a new account. You might also be asked by your financial institution to provide certain evidence to support a claim that you are not a U.S. person if information associated with your account otherwise suggests that you may be a U.S. person. Financial institutions will need this information to satisfy their obligations under Cyprus law and to determine whether they have certain tax reporting obligations to the Tax department.

3. What processes may the financial institutions follow in order to identify U.S account holders?

The participating financial institutions will need to follow one or more processes for identification of account holders such as the indicia search and the self-certification process. The participating financial institutions may obtain a self-certification from an account holder where applicable. The Tax Department will issue a self-certification form that financial institutions may use. Therefore you might be asked by your participating financial institution to fill out a self-certification form for this purpose or the participating financial institution might have proceeded to a new comprehensive form of its account opening documents or to the preparation of an additional document in respect of FATCA provisions.

4. What types of accounts will be reported?

Participating Cyprus financial institutions will have to report accounts which include most bank accounts, mutual funds, brokerage accounts, custodial accounts, annuity contracts (including segregated fund contracts), and some life insurance policies with a cash value.

An account shall not be reportable if it falls within an exempt category in the Agreement.

5. How does my citizenship affect my tax residency?

Cyprus and virtually all other countries do not tax on the basis of citizenship. The citizenship you hold is generally not relevant in determining your residency for tax purposes.

The U.S. tax system is different from most countries in that it treats all U.S. citizens as U.S. residents for tax purposes no matter where in the world they reside. Therefore, if you are a U.S. citizen, you are a resident of the U.S. for tax purposes even if you hold another citizenship or reside in Cyprus or any other country.

6. Am I obliged to provide the information?

Cyprus financial institutions are committed to become fully FATCA compliant and hence your financial institution is entitled to ask you to provide the required documentation. In cases where customers fail to provide the appropriate documentation your participating financial institution must treat your account as a U.S. reportable account and report the account to the Tax Department.

7. What type of information will be reported to the U.S.?

Participating Cyprus financial institutions will generally have to report the following type of information:

  • Identifying information about the account holder (e.g. name, address, tax identification number)
  • Account number
  • Account balance or value at end of the year
  • certain amounts paid or credited to the account

8. Do I have to provide my U.S. Taxpayer Identification Number?

Yes. Cyprus financial institutions will be obliged to ask for your U.S. TIN in connection with certain accounts. If you are a U.S. resident or U.S. citizen, you have to provide your U.S. TIN to your financial institution when asked.

9. I am not a U.S. person, but I have a joint account with a U.S. person. How does FATCA affect me?

A joint account which has one U.S owner shall be treated as a U.S account by a participating Cyprus financial institution. The participating financial institution will then report the full value of the account to the Tax Department. Identifying information (e.g. name, address, Taxpayer Identification Number) associated with
U.S. owner will be reported. No information will be reported for the non U.S joint account holder.

10. I am a Cyprus resident and I hold accounts in the U.S. How does the Agreement affect me?

If your account is identified as a reportable account by your U.S. financial institution, then the account will be reported by the U.S financial institution to the IRS, which will transmit the information to the Cyprus Tax Department.

11. If I maintain several financial accounts in a financial institution, how will they be reported?

If you are identified as a U.S. person, your Cyprus financial institution will report each of your accounts individually to the Tax Department.

12. Could financial institutions be exempted from FATCA provisions?

Under the Agreement, a number of Cyprus financial institutions could be partially or fully exempted from the requirements to undertake due diligence and to report on U.S. account holders. For instance, smaller Cyprus deposit-taking institutions, such as credit unions, with assets under $175 million, may be exempted.
A partial exemption is available for a Cyprus financial institution if it is not part of a multinational group (i.e., it is not related to any entities organized outside of Cyprus) and at least 98 percent of its financial accounts are held by residents of Cyprus or other EU member states. These financial institutions will not be obliged to apply due diligence or report on accounts held by individuals who are Cyprus residents.

If you would like to know the status and obligations of a particular financial institution under the Agreement, please contact the financial institution directly.

13. I am a U.S. citizen living in Cyprus and I was not aware that the U.S. wants me to file tax returns. Does the signing of the Agreement mean that I now have to pay U.S. tax?

The Agreement is strictly an information-sharing agreement and does not involve any new or higher taxes.

FATCA does not replace the existing US tax regimes, as imposed to U.S citizens Unlike Cyprus, the U.S. taxes its citizens who reside in other countries on their worldwide income. The U.S. citizenship-based tax regime has been in place for many years and is not altered by the Agreement. For more information, please contact us and the U.S. IRS Instructions for New Streamlined Filing Compliance Procedures for Non-Resident, Non-Filer U.S. Taxpayers.

14. Does the Agreement require Cyprus financial institutions to report to the Tax Department the accounts of individuals who relinquished their U.S. citizenship when they became Cyprus citizens?

The Agreement does not require Cyprus financial institutions to report on any individuals who have relinquished their U.S. citizenship and are no longer considered as citizens of the U.S.

Individuals who have relinquished their U.S. citizenship may be asked by their financial institution for documentation to support their claim.

fatca

Cyprus Compliance with the Foreign Account Tax Compliance Act

This intergovernmental agreement is activated between the Cyprus Government and the Government of the United States to improve the International Tax Compliance and implementation of FATCA – (Foreign Account Tax Compliance Act) and was signed on 2 December 2014. Under the Inter-Governmental Agreement all participating Cyprus financial institutions are required to report all FATCA related information to the Tax Department in Cyprus.

The participating Cyprus financial institutions had to start collecting certain information about new clients’ accounts from 1st July 2014 and will have to report information on their existing and new U.S. account holders to the Tax Department of Cyprus in 2015.

The Department of Taxation announced that it has issued and published in the Official Gazette of the Government dated 08.28.2015 the Assessment and Collection of Taxes ( Exchange of information under the Agreement for the Tax Accounts Compliance Abroad ) Order 2015 ( SI P . 281/2015 ) .

According to the announcement, the decree specified that the inter alia accounts that are exempt from FATCA Agreement are persons exercising control, the consequences of failure to comply etc.