EU Directive 2019/1151 - Formation of Companies and registration of Branches to be completed fully online
The European Parliament and the Council of the European Union on 20 June 2019 decided to amend the existing Directive in regards to the rules and procedures on the formation of companies, registration of branches, and filing of documents and information by companies and branches (“Online Procedures”) by issuing the Directive 2019/1151 (the “Directive”).
The Directive imposes the obligation on Member States to set out procedures permitting the formation of companies, registration of branches, and filing of documents and information, to be done fully online.
Member States should, however, be able to decide to make some or all Online Procedures mandatory.
The physical presence to notaries or other similar officials will no longer be necessary and thus, company formation, branches registration, and filing of documents and information will be achieved online.
In this respect, the Directive prohibits Member States from imposing a requirement to obtain prior authorization or license for Online Procedures unless this is required for the company’s special activities by national law.
Nevertheless, notaries or lawyers may be used in the online process only in order to control the identity and legal capacity of persons seeking to form a company or register a branch or to file documents or information, to avoid fraud or company hijacking and to provide safeguards for the reliability and trustworthiness of documents and information contained within national registers. However, such involvement should not prevent the completion of the procedure in its entirety online.
In the case of Cyprus, lawyers and the Court Registrar are involved in the process of formation of companies. Currently, an affidavit must be signed by a lawyer in the presence of the Court Registrar and submitted along with the company documents to the Registrar of Companies to achieve company registration. It remains to be seen how the Directive will affect this process currently followed in Cyprus.
Although lawyers may still have a role to play as per the Directive, checking the legality of the process, the Court Registrar seems to become redundant.
In regards to the time frames set out by the Directive the following apply:
i. transposition of the provisions of the Directive to national law shall be completed by 1st of August 2021 with the possibility of one-year extension;
ii. the process of online registration shall be completed within ten (10) days from the date of payment of the registration fee or from the date of complying with online registration formalities.
Generally, the Directive purports to streamline the company law so as to achieve efficiency, cost and time transparency in an era where technology is constantly developing and digital world is rapidly evolving.
Corporate – Legal Department
We are a Law Firm with offices in Cyprus and Malta and a representative office in Shanghai China comprising of more than 80 lawyers, accountants and other professionals who advise, international and local clients.
The Firm has been offering legal and consulting services since 1983 evolving from a traditional law firm to an innovative cutting-edge multidisciplinary law firm combining exceptional expertise in law, tax, vat and accounting.
From its establishment the Firm’s focus has been heavily business oriented and always abreast with the latest global developments and innovations. Drawing from our pool of experienced professionals we provide our clients’ businesses full legal and accounting support on an everyday basis as well as customized solutions in today’s global financial and legal challenges.
We consider ourselves as ‘traditional pioneers’ and our motto is to foresee and anticipate any issues that may potentially impact our clients’ business and to offer effective advice and solutions proactively.
Lawyers’ Limited Company
12 Egypt Street, 1097, Nicosia
P.O. Box 22303, 1520 Nicosia, Cyprus
Tel: + 357 22 55 88 88 – Fax: + 357 22 66 25 00
Civil Partnership, Law Firm
Kinanis Fiduciaries Limited
Suite 20, The Penthouse, 4th Floor, Ewropa Business Centre,
Dun Karm Street, Birkirkara, BKR 9034, Malta
Tel: + 356 27 54 00 24, Fax: + 356 27 54 00 25
Kinanis (China) Limited
China Representative Office
Unit 661, 6/F CIROS PLAZA,
388 Nanjing West Road, Huangpu District,
Shanghai City, 200003, China
Tel: + 86 18 410 072 690
is the service mark through which Kinanis LLC of Cyprus, Kinanis Fiduciaries Limited of Malta, Kinanis, Civil Partnership, of Malta, Kinanis (China) Limited of Cyprus and their affiliated companies are conducting their business each of which is a separate legal entity.
Disclaimer: This publication has been prepared as a general guide and for information purposes only. It is not a substitution for professional advice. One must not rely on it without receiving independent advice based on the particular facts of his/her own case. No responsibility can be accepted by the authors or the publishers for any loss occasioned by acting or refraining from acting on the basis of this publication.
refers to the service mark through which Kinanis LLC of Cyprus, Kinanis Fiduciaries Limited of Malta and their affiliated
companies are conducting business, each of which is a separate legal entity.