Experiences from the Implementation of the Cross-Border Mergers Directive in Cyprus

Abstract

This chapter reviews the implementation of the Cross-border Mergers Directive (hereinafter, “CBMD”) in Cyprus law. It provides a critical overview of the most important provisions of the Cyprus Companies Law (Chapter 113) implementing the CBMD. The basic definitions, the scope, the company types, the applicable law and the procedure of cross-border mergers are discussed. After this overview, various intricacies of the regulation of cross-border mergers in Cyprus are discussed. The various rules implementing the CBMD in Cyprus, as well as the Cyprus case law are scrutinized. The multi-level regulatory model of the CBMD is explained. Subsequently, the multi-level regulatory model in the implementation of the CBMD in Cyprus is analyzed with a special emphasis on the decision-making process, the creditor protection and the protection of minority shareholders. In the context of this multi-level regulatory model, “Arrangements and Reconstructions” in Cyprus Companies Law (Chapter 113), creditor protection in cross-border mergers and its reference to schemes of arrangement, as well as the decision-making process are analyzed. Moreover, in the same multi-level regulatory context, the protection of minority shareholders deriving from schemes of arrangement and from other legal bases in Cyprus Companies Law (Chapter 113) is scrutinised. After the analysis of the multi-level regulatory model, cross-border mergers and Cyprus case law on schemes of arrangement are explored. This chapter also focuses on gold-plating of the transposition of the CBMD into Cyprus law. At the end of the chapter, a few concluding remarks are inferred.