Cyprus Property News 1 November 2025 - by Nigel Howarth
Cyprus has taken a major step to tighten controls over foreign direct investments with the approval of a new law aimed at safeguarding national security and aligning the country with EU regulations.
Parliament passed the legislation on Thursday, establishing a national mechanism to monitor foreign direct investments in “sensitive strategic areas.”
The move brings Cyprus into full compliance with the EU’s FDI Screening Regulation, which came into effect in October 2020. The regulation sets out a framework for cooperation among EU member states and the European Commission to assess foreign direct investments that could affect security or public order.
Under the new Cypriot law, any foreign investments exceeding €2 million will be subject to screening by the national authority. The legislation also covers land and property acquisitions, but only where these are linked to “vital infrastructures.” The government will identify and map such critical areas across the island, with interim guidance provided by the Finance Ministry to assist potential investors.
Importantly, individuals with dual nationality will not be classified as foreign investors under the law. Designated foreign investors must notify the national FDI monitoring authority before proceeding with their investment, which may impose conditions or fines for non-compliance.
Although opposition party AKEL proposed amendments during the plenary session, these were ultimately rejected.
Developers welcome direct investments framework
The Cyprus Land and Property Developers Association welcomed the new direct investments framework, calling it a significant milestone for enhancing transparency, investor confidence, and Cyprus’ international reputation. The Association highlighted that the law strengthens the island’s standing as a credible, modern investment destination by balancing national security with economic openness.
By aligning with the EU’s joint investment supervision mechanism, Cyprus aims to promote both strategic protection and continued economic growth. Industry representatives believe that clear, transparent procedures will help maintain investor trust and ensure long-term stability in the property and investment sectors.
The Association reaffirmed its commitment to collaborate with authorities and contribute to constructive dialogue, ensuring that the new system remains balanced, sustainable, and beneficial to both the Cypriot economy and society.
