The Republic of Cyprus is launching a significant legislative campaign to fortify its property sector against financial crime. According to a recent report from Property News Cyprus, the Ministry of Finance has unveiled a draft bill aimed at closing regulatory loopholes and aligning the nation with strict new European standards.
The proposed legislation, officially titled the Prevention and Suppression of Money Laundering and Terrorist Financing (Amendment) Law of 2026, marks a strategic shift in how real estate transactions are monitored. The government has opened the bill for public consultation, inviting stakeholders to submit feedback via the e-Consultation platform until February 14, 2026.
Strategic Oversight: The Tax Department Takes the Reins
The core of this reform is a change in command. Supervision of the real estate sector for Anti-Money Laundering (AML) and Counter-Terrorist Financing (CFT) purposes will move from the Estate Agents Registration Council to the Tax Department.
As detailed by Property News Cyprus, this move is designed to create a more robust “public authority” model of supervision. The Tax Department was selected for several strategic reasons:
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Existing Expertise: The department already operates a dedicated Property Unit and manages AML oversight for high-value art dealers.
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Cost Efficiency: By utilizing existing infrastructure, the government can implement stricter controls without the high costs of creating a new agency.
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European Alignment: This model mirrors successful frameworks currently used in the United Kingdom (HMRC), Greece, and the Netherlands.
Closing the Regulatory Gap
Under the new law, “obliged entities” will now include all professionals involved in buying, selling, or representing clients in property deals who are not already under the watch of another regulator (such as the Central Bank).
| Feature | Current Framework | Proposed 2026 Framework |
| Primary Supervisor | Estate Agents Registration Council | Tax Department |
| Scope of Professionals | Primarily registered agents | All real estate professionals |
| Legal Driver | National Law 188(I)/2007 | EU Regulation 2024/1624 |
| Implementation Date | Immediate | Transitioning to July 2027 full compliance |
Responding to Global Pressure
The initiative follows findings from the MONEYVAL Committee and the EU’s 2022 Risk Assessment, which identified real estate as a sector highly vulnerable to “dirty money” and tax evasion. By moving now, Cyprus is “future-proofing” its economy ahead of the July 2027 deadline for new EU-wide AML rules.
According to the Ministry of Finance, as cited by Property News Cyprus, this proactive stance is vital for maintaining the island’s reputation as a “credible and reliable international financial center.”
Sector Stability and Future Outlook
The Tax Department believes these changes will significantly lower the risk profile of a key economic sector. By strictly applying the standards set by the Financial Action Task Force (FATF), the government aims to ensure that the ongoing boom in the Cyprus property market is built on a foundation of transparency and legal integrity.
Source: Property News Cyprus