On Thursday, Parliament overwhelmingly approved the introduction of a one-stop-shop framework for ship-owning companies and their shareholders to handle all issues currently dealt with by the Registrar of Companies, in addition to the issues of maritime law. This is according to the House transport committee’s report on the “Law on the Limited Liability Shipping Company (LLSC) Law of 2022,” which establishes a new type of corporate entity called a “Limited Liability Shipping Company.” This new entity will be established as a limited liability company solely for the purpose of owning and operating Cypriot ships.
The LLSC Law also establishes the Registrar of LLSCs as the competent authority for these concerns and will oversee everything related to LLSCs from their establishment until their liquidation. The ultimate goal of this new legislation is to create a one-stop-shop structure for ship-owning corporations and their shareholders within the deputy ministry of shipping, allowing this state ministry to handle all issues that presently fall under the purview of the Registrar of Companies and maritime law.
This new legislation is part of the long-term national policy for Cyprus shipping, “SEA Change 2030.” It puts into practice Action 14 of the plan, which was approved by the Council of Ministers in October 2021. This long-term strategic vision for Cypriot shipping was the result of a cooperative approach that included input from internal, local, and worldwide stakeholders. It contains 35 specific activities under the three primary headings of Sustainable, Extrovert, and Adaptable, all aimed at creating sustainable progress for shipping. The objectives include enhancing the competitiveness of the Cyprus flag in international shipping and streamlining the processes and operating policies for Cypriot shipping firms that possess Cypriot ships.
The “Shipping Business Limited (SLLC)” is a new type of limited liability company created by the SLLC Law, with the express purpose of owning and managing Cypriot ships. The process from creating and registering SLLCs to liquidating them is governed by the new law. Additionally, the SLLC’s Registrar, the Department of the SDM, is designated as the relevant authority. The SDM will be in charge of overseeing the Department, and the General Director of the SDM, who is also the Registrar of Cypriot Ships by law, will serve as the SLLC’s Registrar as needed.
The primary clauses of the Companies Law, Cap. 113, inspired the structure of the SLLC Law. However, the SLLC Law contains streamlined rules designed to make the creation of an SLLC more flexible and attractive to interested parties. This new legal framework enables shipping firms with Cypriot ships already listed in the Registry of the Registrar of Companies to request their ships to be registered in the new registry. The eventual goal of this new legal framework is to establish a one-stop structure for ship-owning corporations and their shareholders within the SDM, allowing the SDM to handle all issues that now fall under the purview of the Registrar of Companies and maritime law.