Understanding the Business Facilitation Unit BFU and Its Benefits for Foreign Investors

The Business Facilitation Unit (BFU) in Cyprus serves as a vital resource for foreign investors looking to establish their operations in the country. As a specialized department of the Ministry of Energy, Commerce and Industry (MECI), the BFU aims to streamline the process of setting up businesses and obtaining necessary permits, making it an attractive option for international companies. This blog post will explore the BFU's functions, eligibility criteria, and the application process, providing valuable insights for potential investors.

What is the Business Facilitation Unit (BFU)?

The BFU acts as a one-stop service for companies of foreign interest, assisting them in various aspects of business establishment. Its primary goal is to attract and support foreign investment in Cyprus by simplifying procedures for international companies and their highly skilled employees. This includes helping businesses register, fast-tracking residence and employment permits for third-country nationals, and providing guidance throughout the process.

The BFU recognizes the importance of foreign investment in boosting the Cypriot economy and aims to create a favorable environment for international businesses. By offering tailored support, the BFU plays a crucial role in enhancing Cyprus's appeal as a destination for foreign investment.

Who Can Apply?

To qualify for BFU support, businesses must typically meet one of the following conditions:

1. Foreign Ownership: The majority of shares (over 50%) must belong to non-EU nationals.

   
   

2. Foreign Investment: The company should be controlled by non-EU shareholders who have invested at least €200,000 in Cyprus, which can be in the form of capital, fixed assets, or operational costs.

   
   

3. International Structure: Certain international companies with a demonstrated foreign profile and Cyprus-based operations may also qualify, even if local shareholders are involved.

   
   

In addition to these criteria, applicants must also fulfill other requirements, including:

• Having a registered office and physical presence in Cyprus (not just a virtual office).

• Submitting a business plan that outlines activities, investment, and employment projections.

  
  

• Demonstrating the intention to employ Cypriot or EU nationals gradually, with at least 30% of staff being local within five years.

  
  

How to Obtain BFU Status

Before applying, businesses need to gather the necessary documentation, which includes:

• Company incorporation documents from the Registrar of Companies.

  
  

• A list of shareholders and the Ultimate Beneficial Owner (UBO).

  
  

• Proof of investment, such as a bank statement, capital deposit, or audited financials.

  
  

• An office lease or title deed that proves physical presence in Cyprus.

  
  

• A comprehensive business plan detailing operational and staffing information.

  
  

• Contact information and a company profile.

Benefits of Engaging with the BFU

Engaging with the BFU offers numerous advantages for foreign investors. Here are some key benefits:

1. Simplified Processes: The BFU simplifies the bureaucratic procedures involved in establishing a business in Cyprus, making it easier for foreign investors to navigate the system.

   
   

2. Fast-Tracked Permits: The unit helps expedite residence and employment permits for non-EU nationals, allowing companies to onboard skilled employees more quickly.

   
   

3. Tailored Support: The BFU provides personalized assistance to businesses, ensuring that they receive the guidance needed to succeed in the Cypriot market.

   
   

4. Access to Resources: Investors can benefit from the BFU's extensive network and resources, which can help them make informed decisions about their business operations.

   
   

5. Economic Contribution: By attracting foreign investment, the BFU contributes to the overall growth of the Cypriot economy, creating job opportunities and fostering innovation.

   
   

Hiring of Non-EU Professionals

One of the key advantages of Cyprus’s Foreign Interest Company (FIC) framework is the ease of employing third-country nationals. The process is designed to minimize red tape while ensuring compliance with local regulations.

Here’s how the system functions in practice:

• Unlimited recruitment flexibility: Companies may employ as many qualified non-EU professionals as required for their operations. The only conditions are that employees meet the established minimum salary and educational or experience criteria.
  

• No local labor market test: For highly skilled positions (earning a gross salary of €2,500 or more per month), employers are not required to demonstrate that no Cypriot or EU candidates were available — a major time-saving benefit.
  

• Family reunification made simple: The main permit holder’s immediate family can accompany them to Cyprus. Spouses or civil partners may also take up employment locally through an uncomplicated single-permit process.
  

• Longer permit validity: Work and residence permits for third-country employees are typically issued for up to three years and can be renewed indefinitely, provided the company continues to meet BFU/FIC eligibility criteria.
  

• Commitment to local employment: Within five years of registering under the foreign interest company scheme, at least 30% of the workforce should consist of Cypriot or EU nationals. Authorities review this ratio after the five-year period to ensure compliance.