COVID-19 - Special Temporary Business Measures in Cyprus


On 27 March 2020 the Cypriot parliament passed legislation (Law 27(I)/2020) in relation to temporary emergency measures aimed at assisting businesses and private sector employees to cope with the pandemic of the virus COVID-19.

On the basis of this legislation the Minister of Labour, Welfare and Social Insurance has the power to provide special benefits for individuals as well as schemes for the support of businesses independently of any provisions to the contrary in any other relevant legislation.

The aim of this article is to clarify the most basic requirements for a business to qualify for either of the Special Schemes already issued by the Minister, either for the Partial or for the Complete Suspension of the Operation of a Business.

Special Partial Suspension Scheme

The scheme for the Partial Suspension of the Operation of a Business, will be valid between 16 March 2020 and 12 April 2020 and any business may be covered by the plan so long as the following conditions are met.

Firstly, a 25% reduction is required in the turnover of the business during March 2020 together with an equivalent reduction projected for April 2020. The reduction is calculated by a comparison with the same months in 2019. In addition, the reduction must have been caused exclusively as a result of the impact of the Covid-19 pandemic. In case, the business was not operating in 2019, then the comparison is made with the months preceding March 2020.

Secondly, it is a precondition that no employee was dismissed from 1 March 2020 and furthermore, businesses participating in the scheme cannot dismiss employees during the period that the business will participate in the scheme as well as for a further period equal in length with that period plus an additional month. There is an exception for dismissals that may be justified without notice. However, employers will not be able to dismiss employees for financial reasons during the relevant period.

Special Complete Suspension Scheme

The scheme for the Complete Suspension of the Operation of a Business, will also be valid between 16 March 2020 and 12 April 2020 and any business may be covered by the scheme so long as the following conditions are met.

This scheme applies to businesses whose operations have been compulsorily suspended by the relevant Orders of the Minister of Health as well as the relevant resolutions of the Council of Ministers. The condition on prohibition of dismissals set out in the scheme for Partial Suspension applies in this scheme as well.

Obviously, apart from the possibility of supplementary clarifications being issued by the Minister there are various other coincidental requirements for taking part in either scheme as well as various detailed consequences involved in case a business is entitled to take part in such a scheme. Michael Kyprianou & Co LLC regularly advises businesses and individuals on dealing with issues arising as a result of the Covid-19 pandemic.

The content of this article is valid as at the date of its first publication. It is intended to provide a general guide to the subject matter and does not constitute legal advice. We recommend that you seek professional advice on your specific matter before acting on any information provided. For further information or advice, please contact us at info@kyprianou.com