Cyprus Prohibits Cash Transactions Over €10,000

Cyprus Prohibits Cash Transactions Over €10,000

The Republic of Cyprus is taking a significant step towards enhancing financial transparency and combating money laundering by introducing a new law that prohibits cash transactions exceeding €10,000. This law will come into effect on January 1, 2025, and applies to all cash transactions that exceed the specified limit.

Key Provisions of the New Law

Under the new legislation, all cash transactions over €10,000 must be conducted using non-cash methods. This includes bank transfers, credit and debit card payments, and other electronic payment methods. Violations of this law will be classified as a criminal offense and may incur a fine of up to 10% of the transaction amount.The law applies not only to the purchase of goods and services but also to real estate transactions. In cases of non-compliance during property purchases, offenders may face fines as well as potential imprisonment for up to five years.

Reasons for Implementing the Law

The bill was initiated by DISY party member Dimitris Dimitriou, who emphasized that this law is part of a broader strategy to tighten control over financial flows in Cyprus. In recent years, authorities have encountered issues related to the introduction of large sums of cash from unknown sources.Parliament Speaker Annita Demetriou also highlighted the need for improved coordination between customs, police, and the Money Laundering Unit (MOKAS) to prevent further attempts to introduce “dirty” money into the country.

Impact on Business and the Economy

This new law will have a significant impact on the business environment in Cyprus. Local companies, particularly those involved in selling cars, jewelry, and artworks, will need to adapt to the new regulations. The shift away from cash transactions may lead to changes in consumer behavior and business practices.Additionally, this legislation aligns with broader trends in Europe and worldwide, where the digitalization of financial services is becoming increasingly relevant. It may also enhance investor confidence in the Cypriot economy.

With the adoption of this new law, Cyprus is making an important move towards improving financial transparency and combating criminal activities. It is expected that this decision will help create a safer financial environment for both local residents and foreign investors. In an era of globalization and digitalization, such measures are essential for ensuring the sustainable development of the country’s financial system.At Hadjivangeli & Partners, we are closely monitoring changes in Cypriot legislation and are ready to assist our clients in adapting to these new conditions. If you have any questions about how these changes may affect your business or need help with compliance strategies, please do not hesitate to reach out to us.