Intellectual property (IP) is a growing and developing field that affects the functioning of the world at large. Dominating areas of technology, social development and economic growth as it encapsulates a number of separate areas of creation as its range of influence is immense.
IP can be one of the most valuable assets of an organisation. Choosing the right location for the centralisation and management of IP is a very important strategic business decision. The ideal location to establish an IP structure is one that can serve the organisation’s business model and strategies, safeguard and protect its IP and contribute to its tax optimisation.
Article 2 of the World Intellectual Property Convention of 1968 defines Intellectual Property comprising of:
- Copyrights, which may take any of the following forms: literary works, dramatic works, musical works, scientific works, artistic works, sound recordings, films, broadcasts, software programmes, published editions, databases and publications;
- Patented inventions in all areas of human endeavour;
- Scientific discoveries;
- Industrial designs;
- Artistic, literary and scientific works;
- Protection against unfair competition;
- Trademarks (and service marks), designs and models that are used or applied on products
- All other rights resulting from intellectual activity in the industrial, scientific, artistic or literary fields.
The above is a non-exhaustive list. Registrable IPs need not be registered in Cyprus to benefit from IP regime. It’s apparent that in recent years, IP protection has attracted much attention in Cyprus. This can be attributed mainly due to the increasing importance of Cyprus as an international commercial centre and to its accession to the European Union on 1 May 2004, resulting in a greater awareness of the need to protect IP rights.
Along with the rest of the world, Cyprus has been developing this area of law so as to protect international IP rights as well as local. It is a signatory to a number of treaties and the latest amendments to its IP law bring Cyprus into line with the acquis communautaire, international IP laws and the concepts surrounding it. The authorities and courts in Cyprus strictly adhere to the applicable provisions of the law so as to ensure the protection of intellectual property rights against infringement and piracy. Cyprus offers an efficient IP tax regime coupled with the protection afforded by EU Member States and by the signatories of all major IP treaties and protocols, such as the Madrid Agreement and the Madrid Protocol on the 4th of November 2003.
Tax benefits of Cypriot IP companies
Cyprus’ wide double tax treaty network and access to the EU Interest and Royalty Directive, serve as additional means for the group to achieve tax optimisation when it comes to IP exploitation through Cyprus.
The new provisions provide exemptions from tax of income related to Intellectual Property, specifically on:
- 80% of worldwide royalty income generated from IP owned by Cypriot resident companies (net of any direct expenses) is exempt from income tax;
- 80% of profit generated from the disposal of IP owned by Cypriot resident companies (net of any direct expenses) is exempt from income tax;
- Any expenditure of a capital nature for the acquisition or development of IP is claimed as a tax deduction in the year in which it was incurred and for the four immediate following years;
All the above exemptions are also available for IPs acquired or developed before January 2012.
Parparinos Milonas Corporate and Legal Consultants, provide a full service in the specific field of intellectual property, from local trademark registration to international litigation. The department is staffed by highly qualified professionals who carry out ongoing research to ensure that they remain informed and up to date with regards to the latest developments in the protection of intellectual property rights.
Our philosophy is to recognise and identify each client, individual or corporate, local or international, as unique, with specific business concerns and needs. We offer a broad range of services which are tailored to the requirements of each client and we exercise a personal commitment to all of them.
Our Firm has been dealing with trademarks, copyright, patents, trade names, and designs successfully for a number of years, and has managed to establish exquisite long-term relationships with many international law firms and specialists. Today we have a network of over 100 IP experts and attorneys from all around the world, who assist us in registering and protecting our clients IP rights.
Our Firm’s department has expertise in the following areas:
- Registration, subsequent designation and renewal of Cyprus, Community or International trademarks, through the Intellectual and Industrial Property Department in Cyprus, OHIM and WIPO.
- Registration of patents, industrial and EC designs and copyrights.
- Filing of a Response to a preliminary Objection to an application for trademark registration at the Intellectual and Industrial Property Department in Cyprus.
- Corporate statutory compliance matters.
- IP arbitration and mediation;
- IP valuation rights in assignments, mergers or acquisitions;
- Existing IP – tax efficient transfer to Cyprus IP Company
- Search and investigation services;
- Trade mark watching and infringement services;
- Trade mark oppositions, cancellations and counterfeiting actions;
- Litigation of other IP rights;
- Counselling on franchising and licensing;
- Technology transfer/purchase agreements.