Cypriot firms struggle to detach from sanctioned providers

The business registrar in the Republic of Cyprus has been flooded with requests from companies scrambling to make changes to their structures, after hundreds of firms on the island saw their assets frozen due to new sanctions targeting agencies viewed by Washington and London as “Russian enablers.”

According to Philenews, some 400 companies that are registered in Cyprus have been affected by an asset freeze, following sanctions imposed last month after American and British authorities included Cypriot professionals and agencies on a list of new sanctions against Russian businessmen.

Philenews said the Department of Registrar of Companies and Intellectual Property was being flooded with requests from businesses that were linked to sanctioned service providers.

“Their aim is to make changes to the company structure so that they can be decoupled from individuals and legal entities that are currently under restrictions,” Philenews reported.

The news comes after media reports suggested Russian businesses in Cyprus were rumored to be moving shop to the northern part of the island to avoid sanctions in the south.

Last month Cypriot banks also shut down thousands of accounts belonging to Russian nationals after Nicosia voluntarily doubled down on the additional sanctions imposed by Washington and London.

Local attorneys and political pundits have urged caution about the sanctions, which have not been adopted by the UN Security Council or the European Union, while President Nikos Christodoulides declared that adhering to the US-UK list was necessary to stir keep the country’s name in the clear.

It was understood that no action was being taken with the requests from companies, with the Registrar reportedly seeking guidance from the Finance Ministry on how to handle such applications.

While sanctioned professionals in Cyprus were not necessarily suspected of any crimes, the sanctions were said to have been aimed at preventing Russian businessmen from providing finances for projects that favored Moscow.