Cyprus, upon becoming a member of the European Union on 1 May 2004, has fully adopted the EC Directives amongst which those which aim to achieve a uniform taxation policy between the 25 Member States. The major EC Directives which have been consolidated in the Cypriot taxation Laws are the following:

• EC Parent/Subsidiary Directive – Aims to ensure no taxation in transactions between parent and subsidiary companies situated in different Member States
  
  
• EC Mergers Directive – Aims to ensure no taxation on company reorganization between different Member States
  
  
• EC Interest and Royalty Directive – Aims to reduce withholding taxes on payments of interest and royalties between Member States.
  
  
• EC Savings Directive – Aims to ensure taxation of interest income in one EU Member State.