We proudly announce another significant legal victory, this time in a complex case involving the attempted redomiciliation of a Cyprus company to Russia with significant shareholding in a Cyprus holding entity.
This case, representing a foreign shareholder with equally substantial interests in the same Cyprus holding entity, displays our firm’s expertise in corporate law and litigation. The Cyprus holding entity, with assets and operations globally, faced a critical situation when one of its’ shareholders (another Cyprus company) attempted to change its legal domicile, from Cyprus to Russia, in violation of Cyprus Companies Law CAP 113.
Our team, led by managing partner Angelos G. Paphitis, partner Maria Constantinou, and senior associate Myrianthi Papagianni, thoroughly examined the attempted redomiciliation process and found it to be fatally faulty, rendering it void and illegal under Cyprus law. Consequently, the ‘new’ entity established in Russia, purported to be a continuation of the Cyprus company, was deemed an entirely separate and independent entity. This distinction invalidated any claims of continuity between the two companies post-redomiciliation.
In light of our findings, AGPLAW filed an action in Cyprus for an order of the court declaring the redomiciliation to Russia illegal. Furthermore, on a without notice process, we successfully applied for and obtained an ex-parte injunction from the Limassol District Court preventing the Russian entity from being registered as a shareholder in the Cyprus company’s members’ register. Simultaneously, through the interim injunction granted, the Russian company is prohibited from presenting itself as a shareholder and stopping the Cyprus company from registering the entity as such.
This litigation success becomes particularly significant considering the dissolution of the Cyprus company by the Registrar of Companies following the attempted redomiciliation, raising complex legal questions about the future treatment of this case across different jurisdictions, including ongoing legal actions in Russia and Europe.
Key Legal Instruments:
- Redomiciliation of a Cyprus Company: This is the process by which a company transfers its domicile from one jurisdiction (Cyprus) to another, altering its legal residency. The procedure must adhere to the laws of both the original and new jurisdictions to ensure continuity of the entity’s legal identity. When properly executed, redomiciliation allows a company to maintain its corporate history and obligations seamlessly.
- Ex-parte Interim Injunction: An ex-parte interim injunction is a legal order issued without the presence or knowledge of the other party. It is used in urgent situations to prevent imminent harm or to preserve the status quo until a full hearing can be held. This preventive measure is critical in stopping unauthorized actions that could cause irreversible damage or infringe upon legal rights pending judicial review.
For all enquiries please contact our team of experts at agp@agplaw.com
The information provided by AGPLAW | A.G. Paphitis & Co. LLC is for general informational purposes only and should not be construed as professional or formal legal advice. You should not act or refrain from acting based on any information provided above without obtaining legal or other professional advice.
