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Cross border Relocation

Dec 13, 2017 By

Our client “Investor” decided to expand the business in Moldova by investing up to 10 mln Euro through Project Finance. In this regard, the client is looking on finding expansion capital.
As per request of the potential co-investors the client decided the transfer of business assets into the Cyprus corporation for 2 reasons:
1. Expanding Investment Vehicles
In order to allow joint investments without an additional level of taxation (e.g. German Investment Fund, REITs) our Client (parent company) buy the shares of the subsidiary company in compensation for the debts owed by BBD in  a Non-merger asset reorganization.
2. Relocation
Cross border relocation of place of management and/or statutory seat  which results in a liquidation of the german corporation.
In principle the relocation of a corporation is treated as a liquidation from a tax perspective (even if no liquidation from a civil law perspective)
Reason: state of residency loses right of taxation.

We cooperate with our german Partner Mr Silvano Pirritano who then provided us with a significant amount of information on the subject”.

—Igor Popa; Popa&Associates