Under Cap.113, the Registrar of Companies may remove from the Register any company which appears not to be doing business and has no external liabilities. The striking off procedure is quite a simple procedure. The procedure may be initiated by the shareholders and directors of the company writing to the Registrar informing him in relation to the company’s inactivity and inviting him to strike the company off from the Register.
The main limitations/disadvantages which should be considered before deciding such strike off are the following:
– When a company is struck off the register, any property it has devolves to the Republic of Cyprus. The procedure is therefore inappropriate for a company which has significant assets that have not been distributed to members.
– Any member or creditor may apply to have the company restored to the register up to 20 years after it has been struck off and its status shall be as if it had never been deregistered.
– The financial statements of the company must be prepared until the date the company ceased activities.
Further, the financial statements must be filed with the relevant income tax return to the Cyprus tax office and after the tax office examines and agrees that any tax liability is settled, a Tax Clearance certificate will be issued. The procedure for the strike-off the Register normally takes approximately 1 year to be completed.