Who we are

Economou & Co LLC stands out in the Cypriot legal landscape as a boutique law firm with a specialized focus on dispute resolution and international arbitration. Through our unique expertise, we manage some of the most critical dispute resolution projects in Cyprus, including:

• Liquidation proceedings involving debts amounting to more than 1 billion Euros.
• Recognition proceedings for arbitral awards nearing half a billion Euros.
• Applying the precedent of the House of Lords judgment in R. v. Preddy [1996] W.L.R. 255 in a significant white-collar crime case for the first time in Cyprus.
• Obtaining an unprecedented prohibitory injunction against a state in a multi-million-euro arbitral award recognition case, dealing with aspects of state immunity for the first time in Cypriot courts.
• Successfully securing worldwide freezing orders and disclosure orders in high-profile fraud and conspiracy cases, involving financial stakes exceeding €500 million.

Obtaining Interim Relief in Cyprus

Cyprus is a premier jurisdiction for obtaining interim relief, with a robust legal framework that caters to both domestic and international disputes. This guide explores the extensive array of interim orders available in Cyprus, including their legal foundations, procedural requirements, and practical applications.

Whether you are a foreign lawyer or part of a multinational legal team, this detailed overview will help you understand the scope of interim measures in Cyprus, making it a go-to jurisdiction for enforcing rights, preserving assets, and ensuring justice in cross-border cases

Understanding Interim Orders in Cyprus

Interim orders are vital court-issued measures that protect parties' rights and interests while legal proceedings are pending. These orders ensure the status quo is maintained, prevent irreparable harm, and secure assets or evidence that may otherwise be lost. Cypriot courts derive their authority to issue such orders from Section 32 of the Courts of Justice Law (14/60), which allows them to act when it is "just and convenient."

Key Principles for Granting Interim Orders

To obtain an interim order, the applicant must convince the court of the following:

A Serious Issue to Be Tried.

Likelihood of Success: There is a probability (visible prospects of success) that the applicant is entitled to relief

Risk of Irreparable Harm: The applicant must prove that the harm they face cannot be adequately compensated by damages.

Balance of Convenience: Courts evaluate whether the harm caused to the respondent by granting the order is outweighed by the harm to the applicant if the order is denied.

Prohibitory Orders (Injunctions)

Prohibitory orders, or injunctions, are vital legal tools under Cypriot law used to prevent a party from taking actions that could harm the rights or interests of another during litigation. These orders are issued to maintain the status quo and ensure that the outcome of a case is not undermined by actions such as asset dissipation or breach of contractual obligations.

1. Main types of Prohibitory Orders

1. Freezing Orders (Mareva Injunctions):

• Designed to prevent the respondent from transferring, concealing, or dissipating assets. These orders ensure that the defendant’s assets remain available to satisfy a potential judgment.
• Assets subject to freezing orders include bank accounts, shares, real estate, and even cryptocurrencies.
• Freezing orders can be domestic or worldwide, allowing claimants to preserve assets located outside Cyprus.

2. Asset-Specific Injunctions:

• Target specific assets or properties, such as land or shares in a company, ensuring they remain intact while a dispute is resolved.

2. Procedure

Prohibitory orders are often sought through ex parte applications in urgent cases where prior notice to the respondent could defeat the purpose of the order. For ex parte orders, the applicant must provide full and frank disclosure of all material facts.

3. Practical Applications

• Cross-Border Asset Protection: Freezing orders can secure offshore or hidden assets in complex international disputes.
• Fraud Cases: Prevent defendants from dissipating stolen funds or misappropriated assets.
• Corporate Disputes: Ensure shareholders or directors do not undermine company interests during litigation.

Read more about Prohibitory Orders.

Disclosure Orders (Norwich Pharmacal Orders)

Disclosure orders, also known as Norwich Pharmacal orders, are powerful legal tools used under Cypriot law to compel third parties to disclose information crucial to the pursuit of justice. These orders are instrumental in identifying wrongdoers, tracing misappropriated assets, and gathering evidence necessary for legal proceedings.

1. Purpose of Disclosure Orders

Disclosure orders are primarily sought when a third party, often uninvolved in the wrongdoing, possesses information or documents critical to uncovering the truth in a dispute. These orders are most commonly used in cases involving fraud, conspiracy, or breaches of fiduciary duty, where tracing and identifying assets or beneficiaries is essential.

2. Legal Framework

The legal foundation for disclosure orders in Cyprus stems from the Norwich Pharmacal principle, established in English law and adopted by Cypriot courts, which allows courts to order disclosure even when the third party is innocently "mixed up" in wrongdoing and holds information vital to the applicant’s claim.

3. Additional Requirements for Granting a Disclosure Order

• Evidence of Wrongdoing: The applicant must provide credible evidence that wrongdoing has occurred.
• Third Party’s Involvement: The respondent must hold information or evidence, even if they were innocently involved in the wrongdoing. Common third parties include banks, financial intermediaries, or corporate agents.
• Necessity of Disclosure: The information sought must be essential to enable an action against the ultimate wrongdoer.

4. Practical Applications

• Fraud Cases: Disclosure orders help identify the flow of misappropriated funds by compelling banks or financial institutions to disclose transaction records.
• Tracing Hidden Assets: These orders are invaluable in locating assets that have been concealed through offshore accounts or corporate structures.
• Intellectual Property Disputes: They can identify distributors or manufacturers involved in infringement cases.
• Corporate Misconduct: Disclosure orders can reveal the identities of beneficial owners or individuals orchestrating corporate wrongdoing.

5. Examples of Information That Can Be Disclosed

• Bank account details and transaction records.
• 0Identities of beneficial owners or key stakeholders in companies.
• Communications, including emails or contract documentation, relevant to the dispute.

Read more about Disclosure Orders.

Receivership Orders

Receivership orders are powerful legal remedies under Cypriot law, enabling courts to appoint independent third parties (receivers) to manage, safeguard, or preserve disputed assets during litigation. These orders are particularly valuable in cases involving financial mismanagement, corporate disputes, and fraud, ensuring that assets are protected and professionally managed while legal proceedings are underway.

1. When Are They Granted?

Receivership orders are rightfully considered to be an intrusive, costly and not easily reversible remedy.

A court may be unwilling to appoint a receiver over the property of a defendant if a less drastic remedy (such as a prohibitory order) can adequately safeguard the applicant’s rights.

A receivership order may also be appropriate if the assets need to be managed so that their value is preserved, e.g., a portfolio of share or commodity options, or where the assets need to be exploited to realize their true worth, e.g., a patent.

2. Key Features

• Neutrality: The Receiver, albeit chosen by the applicant, is still an officer of the court. Thus, he/she should act for the benefit of all parties in the action. Following the implementation of the Insolvency Counsels Law (64(I)/2015), the appointed receiver must now also be a duly licenced Insolvency Counsel.
• Management Authority: They can be empowered to manage and maintain assets.

3. Practical Applications

• Corporate Disputes: Ensuring operational continuity of businesses embroiled in shareholder disputes or ownership challenges.
• Fraud Cases: Securing and managing assets linked to misappropriation or embezzlement.
• Insolvency Proceedings: Protecting creditors’ interests

Read more about Receivership Orders.

Chabra Order

Chabra orders are a specialized form of freezing injunction under Cypriot law that extend to assets held by third parties. These orders are particularly effective in complex multi-jurisdictional cases involving offshore trusts, nominee arrangements, or other indirect ownership structures.

Chabra orders derive their name from the landmark English case TSB Private Bank International SA v Chabra. These orders target third parties who, while not directly involved in wrongdoing, hold assets beneficially owned by the primary defendant. By extending freezing orders to such third parties, Chabra orders prevent the circumvention of justice in cases where assets are deliberately concealed or shielded behind complex ownership structures.

1. When are they granted?

• Ownership or Control: The third party against whom there is no cause of action is in possession of assets beneficially owned by the main defendant. The latter can be shown to control or have the power to dispose the assets.
• Relevance to Judgment: There is good reason to suppose that the assets would be amenable to some process, ultimately enforceable by the courts, by which the assets would be available to satisfy a judgment against the main defendant.
• Connection between the third party and the main defendant: The affairs of the third party against whom the injunction is sought are intermingled with the affairs of the main defendant.
• Risk of Dissipation: There must be a credible risk that the assets will be transferred, hidden, or dissipated.

2. Practical Applications

• Trust Structures: Where assets are held in offshore or domestic trusts, and the defendant is the ultimate beneficiary.
• Nominee Arrangements: Where third parties act as legal owners of assets that are in reality controlled by the defendant.
• Corporate Vehicles: In cases where the defendant uses shell companies or corporate structures to hide ownership of significant assets.

Read more about Chabra Orders.

Anton Piller Orders (Search Orders)

Anton Piller orders, commonly referred to as search orders, are a highly intrusive yet effective legal remedy available under Cypriot law. These orders allow an applicant to enter a respondent’s premises to search for, inspect, and secure evidence critical to a legal dispute. They are particularly valuable in cases involving intellectual property theft, fraud, or the concealment of vital documents. By preserving evidence that might otherwise be destroyed, Anton Piller orders play a pivotal role in ensuring justice.

1. When are they granted?

Due to their exceptional nature, applicants seeking an Anton Piller order must satisfy strict legal requirements, including:

• Very Strong Prima Facie Case: The applicant must present compelling evidence of wrongdoing by the respondent.
• Risk of Severe Damage: A credible risk must exist that the respondent will destroy or conceal evidence if the order is not granted.
• Proportionality: The benefit of preserving the evidence must outweigh the intrusion caused to the respondent.
• Full and Frank Disclosure: The applicant must provide the court with all relevant facts, including potential weaknesses in their case.

2. Key Features

• Strict Oversight: Courts impose stringent conditions to prevent abuse and protect the respondent’s rights.
• Costs: Due to their complexity, these orders can be costly to obtain and execute.
• Expedited Justice: Allows immediate access to evidence, reducing delays in litigation.

3. Practical Applications

• Intellectual Property Disputes: To prevent the destruction of infringing products or unauthorized reproductions, such as counterfeit goods or illegally copied software.
• Fraud Cases: To preserve documents, transaction records, or other evidence proving financial misconduct or conspiracy.
• Breach of Confidentiality: To secure proprietary information or trade secrets that are being misused or unlawfully disclosed.
• Corporate Mismanagement: To recover records or communications that demonstrate breaches of fiduciary duty.

Read more about Anton Piller Orders.

Expanded Jurisdiction of Interim Relief in Cyprus

Recent amendments to Cypriot interlocutory proceedings have radically expanded the jurisdiction of Cypriot courts, particularly in issuing interim relief.

Cypriot courts now have the authority to issue interim orders, such as freezing and disclosure orders, in aid of litigation taking place outside Cyprus.

These changes reinforce Cyprus as a strategic jurisdiction for resolving multi-jurisdictional disputes, particularly those involving offshore assets or international fraud.

Conclusion

At Economou & Co LLC, we specialize in securing high-stakes interim relief for clients involved in complex legal disputes. Our expertise encompasses freezing orders, disclosure orders, and sophisticated asset-tracing strategies, ensuring that our clients' rights and interests are safeguarded at every stage of litigation.

With Cyprus emerging as a pivotal jurisdiction for cross-border disputes, we are exceptionally positioned to address the full spectrum of interim remedies under Cypriot law.

For bespoke legal solutions and expert representation, contact Economou & Co LLC to discuss how we can protect your rights and achieve your objectives.