In terms of the Merchant Shipping (Registration of Ships, Safes & Mortgages) Laws of 1963 and as amended, a yacht shall be deemed to be a Cyprus yacht where more than fifty percent (50%) are owned either:

(a) by a Cypriot citizen; or

(b) by a Cyprus registered company irrespective of whether such company is owned totally by aliens; or

(c) with the special permission of the Council of Ministers, by a foreign registered company with a controlling interest held by Cypriots

A yacht-owning company, unlike all other offshore companies, may be owned either entirely by Cypriots, or exclusively by foreigners or jointly by Cypriots & foreigners. Thus, it is necessary for foreigners to set up a Cypriot "yacht owning company" and transfer the yacht to that company.