MPs push for tighter rules on foreign property purchases

MPs on Thursday called for tighter controls on property purchases by foreign nationals, warning that legislation restricting individual buyers could prove ineffective unless companies and other corporate structures were also covered. The House interior committee continued examining proposed amendments to legislation governing the acquisition of property by foreigners, with discussions expected to resume in a fortnight. The committee is awaiting the government’s next steps towards drafting a comprehensive legislative proposal regulating property acquisitions by foreign nationals. Committee chairman and Akel MP Aristos Damianou said efforts to introduce the legislation were gathering pace, expressing hope that the process could be concluded by the end of the year. He said consolidated drafts had been prepared in April, but the process was interrupted by the parliamentary elections in May. Damianou described the issue as “particularly serious”, saying it concerned national security, the economy and the country’s future. “We are a partially occupied state, part of whose territory is occupied by Turkey, whilst part of its territory is under the control of British bases,” he said, stressing the need to establish clear criteria and restrictions on property acquisitions. He also raised concerns about property transactions conducted through contracts that, he said, were often not made public, allowing foreign interests to acquire property through companies and other intermediary arrangements. Damianou warned that legislation focusing exclusively on individuals would be insufficient. “If issues concerning natural persons, companies, funds and all those who purchase property in Cyprus in a concealed manner are not also regulated, then regulating natural persons alone will be insufficient,” he said. Disy MP Nikoletta Konstantinou also called for a comprehensive approach, saying the proposed legislation concerned the Republic’s strategic interests and national security. She expressed concern that restrictions applying only to individuals could undermine the effectiveness of the legislation, arguing that both natural and legal persons should be covered. “There is little point in discussing whether a natural person will be unable to purchase a property, be it 1,000, 2,000 or 4,000 square metres, if the beneficial owner themselves will ultimately be able to acquire property through a corporate structure,” she said. Konstantinou argued that the government should have presented a comprehensive proposal taking into account European law, the property market and Cyprus’ investment policy. “Our aim must be a framework that genuinely protects national security and the Republic’s strategic interests, without creating unjustified or disproportionate restrictions that ultimately cause problems for the country’s economic and investment activity,” she said. Meanwhile, Diko MP Panikos Leonidou called for immediate action to regulate land purchases by third-country nationals. He said the situation had reached “uncontrolled proportions” and was causing concern among citizens. Leonidou urged Interior Minister Constantinos Ioannou and his ministry to take the initiative and introduce comprehensive legislation. “The ministry of the interior must immediately table a bill covering all aspects of this problem,” he said.