General Terms of Engagement

CMC Certus Management Consultants Ltd

General Terms of Engagement – Valid since incorporation (HE320171)

§ 1 Scope of Application and Client

(1) These General Terms of Engagement (hereinafter the “GTE”) shall govern all present and future business relationships between CMC Certus Management Consultants Ltd (hereinafter “CMC”), registered with the Cyprus Registrar of Companies under number HE320171, having its registered office at 61 Archbishop Makarios III Avenue, Serghides House, Suite 102, 6017 Larnaca, Republic of Cyprus, and its clients (hereinafter the “Client”).

(2) Any natural or legal person may become a Client. The Client shall act in the course of its commercial or independent professional activity. CMC exclusively enters into agreements with business entities or professionals. Where the Client acts on behalf of a third party, the Client acknowledges these GTE on that third party’s behalf and accepts them in its name.

(3) CMC provides services in particular in the areas of company incorporation and administration under Cypriot law, tax advisory and tax residency, advisory within the scope of the Cypriot IP box regime, bookkeeping and payroll, VAT registrations, office rental, and assistance with corporate bank account opening. The specific scope of services shall be determined by the respective engagement letter and the signed engagement form.

(4) Any deviating, conflicting or supplementary general terms and conditions of the Client shall not form part of the agreement unless CMC expressly consents thereto in writing.

(5) Individual agreements made on a case-by-case basis shall always take precedence over these GTE. Individual agreements shall require written form to be effective.

(6) CMC shall perform services exclusively in the Republic of Cyprus on behalf of the Client, unless otherwise agreed in writing.

(7) The language of correspondence between CMC and the Client shall be German or English. Where correspondence is conducted in other languages in individual cases, CMC shall not be liable for translation errors unless attributable to wilful misconduct or gross negligence.

§ 2 Formation of Contract and Engagement

(1) Proposals issued by CMC are non-binding and subject to change unless expressly designated as binding. A contract shall only be formed upon the Client’s submission of an engagement instruction and its acceptance by CMC. Mere enquiries by e-mail, telephone or otherwise shall not give rise to an engagement relationship.

(2) The engagement shall be issued by signing the respective engagement form and submitting it by e-mail to auftrag@steuerberater-zypern.info or to another e-mail address designated by CMC. Transmission of a signed scan or photograph of the engagement form by e-mail shall be sufficient.

(3) CMC reserves the right to decline engagements without stating reasons.

(4) The Client warrants that all information provided in connection with the engagement is complete and accurate. Any changes shall be notified to CMC in writing without undue delay.

(5) The subject matter of the engagement is the agreed activity, not the achievement of any particular legal, tax or economic outcome. A guarantee of success or result shall only exist where expressly agreed in writing between the parties.

(6) The engagement does not constitute a power of attorney to represent the Client before authorities, courts or any other bodies. Powers of attorney must be granted separately and in writing.

§ 3 Performance of Services

(1) CMC shall perform the agreed services with the diligence of a prudent businessperson and in compliance with applicable Cypriot laws and regulations.

(2) CMC shall rely on the accuracy of the information provided by the Client, in particular numerical data. Where CMC identifies obvious inaccuracies, CMC shall draw the Client’s attention thereto. Any further verification of the accuracy, completeness and regularity of documents and data submitted by the Client shall only form part of the engagement where so agreed in writing.

(3) CMC regularly engages partner lawyers, tax advisors and auditors in the performance of its contractual obligations. CMC is further entitled to engage additional qualified third parties. CMC shall select such parties with due care and ensure they possess the requisite professional qualifications.

(4) Unless otherwise agreed in writing, the engagement shall not comprise legal advice within the meaning of the legal profession laws of the Client’s country of origin. CMC provides advisory services exclusively in the field of Cypriot corporate, tax and administrative law.

(5) CMC does not provide tax advice on cross-border matters with respect to the laws of other jurisdictions. The Client is obligated to independently obtain advice from locally resident tax advisors or lawyers in its country of origin and in all other jurisdictions concerned. This applies in particular to value-added tax matters in other states.

(6) If the legal position changes after the final completion of an individual engagement, CMC shall not be obligated to notify the Client of such change or its consequences.

(7) CMC is entitled to advise and serve other clients in comparable matters. The Client shall have no claim to exclusivity unless otherwise agreed in writing.

§ 4 Client’s Own Responsibility

(1) The Client is solely responsible for its tax affairs and decisions in all jurisdictions. CMC supports the Client in an advisory and operational capacity exclusively with respect to Cypriot law.

(2) By submitting the engagement, the Client expressly declares that it is receiving tax advice in its country of origin and is fully complying with its tax obligations there. CMC assumes no duty to verify or advise with respect to the Client’s tax obligations outside Cyprus.

(3) The advisory services rendered by CMC do not constitute a guarantee of any particular tax outcome. In particular, CMC does not warrant that tax authorities will accept the tax structure chosen by the Client.

§ 5 Client’s Duty to Cooperate

(1) The Client is obligated to provide CMC with all documents, information and data necessary for the performance of the engagement in a timely, complete and usable manner. The documents specified in the respective engagement letter shall be submitted as clear PDF scans in A4 format.

(2) The Client is obligated to inform CMC in writing without undue delay of all changes relevant to the engagement relationship, in particular changes of address, shareholding structure, beneficial owners, business activity or tax status.

(3) The Client is obligated to submit new or renewed identification and passport documents to CMC without undue delay upon issuance.

(4) Where the Client is aware of imminent deadlines or particular urgency, it is obligated to notify CMC thereof without undue delay and in explicit terms. CMC shall not be liable for missed deadlines attributable to the Client’s failure to inform CMC in due time.

(5) Delays attributable to the Client’s insufficient or late cooperation shall not be borne by CMC. Any additional costs arising therefrom shall be borne by the Client.

§ 6 Compliance, AML and KYC Obligations

(1) CMC is obligated to comply with Cypriot anti-money laundering and counter-terrorist financing regulations. The Client is obligated to cooperate in the performance of the statutory due diligence obligations (Know Your Customer / KYC).

(2) The Client is obligated to submit current KYC documents to CMC on its own initiative and without being requested to do so, once per year. This shall include valid passport copies of all directors, secretaries, shareholders and beneficial owners, current proof of address (not older than 3 months), and updated information on business activity and source of revenue, to the extent any changes have occurred.

(3) In addition, the Client is obligated to submit new or renewed identification and passport documents to CMC without undue delay, irrespective of the annual update cycle.

(4) If the Client fails to comply with its KYC obligations, CMC shall notify the Client in writing of the outstanding documents and grant a grace period of 14 calendar days. If the Client fails to fulfil its KYC obligations within the grace period, CMC shall be entitled to suspend all services until full compliance with the KYC requirements. CMC shall not be liable for any disadvantages incurred by the Client as a result of such suspension.

(5) CMC is entitled and, in certain cases, statutorily obligated to report suspicious transactions to the competent authority (MOKAS). In such cases, CMC is not permitted to inform the Client of the report (tipping-off prohibition).

(6) CMC reserves the right to terminate the engagement relationship without notice in writing following the unsuccessful expiry of the grace period referred to in paragraph (4). Termination without prior grant of a grace period shall only be permissible where there are substantiated doubts as to the legality of the Client’s business activities.

§ 7 Fees and Payment Terms

(1) Fees shall be determined by the respective engagement letter. All prices are quoted in euros (EUR) net, plus Cypriot value-added tax at the statutory rate, currently 19%.

(2) Invoices shall be due for payment within 14 calendar days of the invoice date, without deduction.

(3) In the event of late payment, CMC shall be entitled to charge default interest at a rate of 8 percentage points above the respective base rate of the European Central Bank. The right to claim further damages for default is reserved.

(4) If the Client is in default of payment of an invoice, CMC shall issue a written reminder and grant a grace period of 7 calendar days. If the Client fails to make payment within the grace period, CMC shall be entitled to suspend all services with immediate effect. CMC shall not be liable for any disadvantages, damages, late payment surcharges, fines or other adverse consequences incurred by the Client as a result of such suspension due to payment default. Services shall only be resumed upon full settlement of all outstanding amounts, including any accrued default interest.

(5) Monthly recurring services shall be invoiced annually in advance, unless otherwise agreed in writing.

(6) Additional disbursements (e.g. notarisations, stamp duties, government fees, translation costs) shall be invoiced separately.

(7) For services exceeding the scope agreed in the engagement letter, CMC reserves the right to charge a customary fee. Advisory services shall be billed at EUR 250 net per hour, unless a different hourly rate has been agreed in writing.

(8) CMC shall be entitled to adjust the fees for recurring services once per year. Fee adjustments shall be communicated to the Client in writing no later than 30 days prior to their effective date. In the event of a fee increase, the Client shall have a special right of termination: the Client may terminate the affected agreement in writing within 14 days of receipt of the notification. The termination shall take effect on the date the fee increase would have become effective. If the Client does not exercise this right, the new fees shall be deemed accepted.

(9) The Client shall not be entitled to set off claims against amounts owed to CMC unless the counterclaim is undisputed or has been established by final judgment. The Client’s right of retention shall only be permissible to the extent the counterclaim arises from the same contractual relationship.

(10) The assignment of the Client’s claims against CMC to third parties shall require the prior written consent of CMC.

§ 8 One-Off and Recurring Services

(1) One-off services (e.g. company incorporation, transfer of administration, application for tax residency) shall terminate upon complete performance of the services agreed in the engagement letter.

(2) Agreements for recurring services (e.g. bookkeeping, office rental, payroll) shall have a minimum term of twelve (12) months from commencement. Upon expiry of the minimum term, the agreement shall automatically renew for successive periods of twelve (12) months each, unless terminated by either party in writing with three (3) months’ notice prior to the end of the then-current term.

(3) The payment obligation for the virtual office shall commence on the date of registration of the registered address with the Registrar of Companies or on receipt of the first business correspondence at the address provided, whichever occurs first.

(4) The annual filing of beneficial ownership information (UBO) and the annual compliance fees are statutory requirements. CMC shall not be liable for fines resulting from the Client’s late provision of information.

§ 9 Company Dissolution and Transfer

(1) If the Client decides to dissolve (liquidate) its Cypriot company, CMC shall invoice the costs in a final account. The liquidation shall be initiated upon receipt of payment.

(2) In the event of a transfer of the company’s administration to another service provider, the handover of documents shall take place upon full settlement of all outstanding amounts.

(3) Following termination of the engagement relationship, CMC shall not be obligated to notify the Client of expiring deadlines or continuing obligations.

§ 10 Liability and Limitation of Liability

(1) CMC shall be liable for damages only in cases of wilful misconduct and gross negligence. In cases of slight negligence, CMC shall only be liable for breach of material contractual obligations (cardinal obligations), limited to the foreseeable damage typical of the contract.

(2) CMC shall only be liable for information and undertakings provided in writing. CMC accepts no liability for oral statements, telephone communications or messages transmitted via messaging services.

(3) In cases of slight negligence, CMC’s liability shall be limited to the fee agreed and paid for the specific engagement, subject to a maximum of EUR 10,000 per claim. In cases of gross negligence, liability shall be limited to EUR 10,000 per claim. These limitations shall not apply in cases of wilful misconduct.

(4) CMC shall in particular not be liable for:

damages caused by inaccurate, incomplete or late information or documents provided by the Client

decisions, delays or refusals by authorities, courts, banks or other third parties

tax disadvantages arising from changes in legislation, administrative practice or case law

force majeure events pursuant to § 18

acts or omissions of partner lawyers, tax advisors, auditors or other third parties, provided CMC exercised due care in their selection

disadvantages resulting from the suspension of services due to payment default (§ 7(4)) or failure to cooperate with KYC requirements (§ 6(4))

tax, economic or legal consequences of the Client’s own decisions (§ 4)

damages arising from the transmission of information by e-mail or messaging services, in particular interception, manipulation or loss by third parties

the correct application of foreign law; liability shall extend exclusively to Cypriot law

the content of CMC’s websites, which serve for general information purposes only

(5) Claims for damages shall become time-barred within 24 months of the Client becoming aware of the damage, and in any event no later than 3 years after the act giving rise to the damage.

(6) The foregoing limitations shall not apply to damages resulting from injury to life, body or health, or in cases of fraudulent concealment of defects.

(7) Claims against CMC shall as a matter of principle be asserted individually.

§ 11 Electronic Communication

(1) Communication between CMC and the Client shall generally be conducted by e-mail, WhatsApp/Signal, telephone or in person. CMC uses transport encryption for e-mail communication.

(2) The Client acknowledges that the electronic transmission of information involves risks. CMC shall not be liable for damages resulting from unauthorised access or manipulation by third parties.

(3) Written form within the meaning of these GTE requires a handwritten signature or a qualified electronic signature. Transmission of a signed document as a scan by e-mail shall satisfy the written form requirement. E-mails, messenger communications and other electronic communications without a signature shall not satisfy the written form requirement and shall not be legally binding, unless expressly provided otherwise in these GTE.

§ 12 Confidentiality

(1) Both parties undertake to treat all information obtained in the course of the engagement relationship as strictly confidential. This shall include in particular commercial, financial, tax and personal data, corporate structures, bank account details, accounting data, contracts, and CMC’s proposals and pricing.

(2) Confidential information may only be used for the purpose of performing the agreement.

(3) Both parties shall implement appropriate technical and organisational measures to protect confidential information. CMC stores client data on encrypted systems and restricts access to those employees who require the information for the performance of the engagement.

(4) Exempted are disclosures required by law or regulatory order; disclosures to partner lawyers, tax advisors, auditors or banks engaged by CMC (provided they are subject to a comparable duty of confidentiality); disclosures with the prior written consent of the other party; disclosures in defence of CMC’s legitimate interests (in particular for legal defence against liability claims by the Client); and information that was already publicly known or demonstrably known to the receiving party prior to disclosure.

(5) The duty of confidentiality shall survive the termination of the engagement relationship for an unlimited period.

(6) CMC employees with access to client data are bound by individual contractual confidentiality obligations.

(7) In the event of a breach, the defaulting party shall be liable for the damage demonstrably incurred. The right to extraordinary termination shall remain unaffected.

(8) Upon termination of the engagement, confidential information shall be returned or demonstrably deleted upon request, to the extent statutory retention obligations do not preclude this.

§ 13 Data Protection

(1) CMC processes personal data of the Client and persons acting on its behalf for the purpose of contract performance and in compliance with Regulation (EU) 2016/679 (GDPR) and the Cypriot Data Protection Law (Law 125(I)/2018).

(2) Controller: CMC Certus Management Consultants Ltd, 61 Archbishop Makarios III Avenue, Serghides House, Suite 102, 6017 Larnaca, Republic of Cyprus. Data protection enquiries: kontakt@steuerberater-zypern.info.

(3) Categories of data processed: master data (name, date of birth, nationality, address), identification data (passport number, passport copy), contact data (e-mail, telephone), tax data (TIN, VAT number, social insurance number, income details), banking data (IBAN, payment transactions), corporate data (structure, shareholdings, beneficial owners), accounting data (invoices, receipts, transactions, payroll records) and engagement-related communication data.

(4) Legal bases: Art. 6(1)(b) GDPR (performance of a contract), Art. 6(1)(c) GDPR (compliance with legal obligations, in particular anti-money laundering, tax law, beneficial ownership register) and Art. 6(1)(f) GDPR (legitimate interests, in particular receivables management and IT security).

(5) Recipients: Personal data shall only be disclosed to third parties to the extent necessary for the performance of the agreement or due to statutory obligations. Recipients may include: the Cypriot Tax Department, Social Insurance Services, the Registrar of Companies, the Civil Registry and Migration Department, partner lawyers, tax advisors, auditors, banks, MOKAS and the beneficial ownership register (Ariadni).

(6) Third-country transfers: To the extent personal data is transferred to recipients outside the European Economic Area, such transfer shall be based on an adequacy decision of the European Commission, appropriate safeguards pursuant to Art. 46 GDPR (in particular EU standard contractual clauses) or the data subject’s consent.

(7) Retention periods: Accounting records and annual financial statements – 7 years after the end of the financial year; tax records – 7 years after the end of the tax year; KYC and compliance records – 5 years after termination of the engagement pursuant to Cypriot AML regulations; corporate documents – 7 years after dissolution or transfer. Upon expiry, data shall be deleted or anonymised.

(8) Data subject rights: access (Art. 15 GDPR), rectification (Art. 16), erasure (Art. 17, subject to statutory retention obligations), restriction (Art. 18), data portability (Art. 20), objection (Art. 21) and the right to lodge a complaint with the competent supervisory authority (Commissioner for Personal Data Protection, Cyprus). Requests: in writing to kontakt@steuerberater-zypern.info. CMC shall respond within one month.

(9) Automated decision-making: CMC does not employ automated decision-making including profiling within the meaning of Art. 22 GDPR.

(10) Obligation to provide data: The provision of the personal data referred to in paragraph (3) is partly required by law (in particular under AML regulations and tax reporting obligations) and partly a contractual prerequisite for the establishment and performance of the engagement. Without the provision of the required data, CMC will not be in a position to accept the engagement or perform the agreed services.

(11) Data security: CMC implements appropriate technical and organisational measures, in particular encryption of data transmission (SSL/TLS), access control through password-protected systems and role-based authorisation, regular security updates and data backups, and confidentiality obligations for all employees with access to data.

(12) Data breach: In the event of a personal data breach, CMC shall notify the competent supervisory authority pursuant to Art. 33 GDPR without undue delay and, where feasible, within 72 hours of becoming aware thereof, provided the breach is likely to result in a risk to the rights and freedoms of natural persons. Where a high risk is likely, CMC shall inform the Client in writing without undue delay pursuant to Art. 34 GDPR, setting out the nature, consequences and remedial measures.

§ 14 Retention and Return of Documents

(1) CMC shall retain documents for the duration of the statutory retention periods.

(2) Upon termination of the engagement and full settlement of all outstanding amounts, the Client shall be entitled to the return of its original documents. CMC shall be entitled to retain copies.

(3) The Client is requested to collect its documents within six (6) months following termination or to designate a delivery method. CMC shall notify the Client in writing at its last known e-mail address or postal address at least 30 days prior to any intended destruction. Following expiry of the period, CMC shall be entitled to destroy the documents at the Client’s expense, provided no statutory retention obligations preclude this.

(4) Electronically stored data shall be made available in a commonly used file format upon request.

§ 15 Termination

(1) Terminations shall require written form to be effective. Termination by e-mail (scan of the signed termination letter) shall be sufficient. Oral terminations or terminations by messaging service shall be invalid.

(2) The right of either party to terminate without notice for cause shall remain unaffected. Cause for termination by CMC shall exist in particular where:

the Client is in default of payment for more than 30 days despite a written reminder

the Client has deliberately provided false information

the relationship of trust has been permanently destroyed

the Client violates statutory provisions or requests CMC to act in contravention of applicable law

compliance or KYC requirements cannot be met

a serious breach of the duty of confidentiality has occurred

Cause for termination by the Client shall exist in particular where:

CMC fails to perform a material contractual obligation despite a written reminder and the granting of a reasonable grace period

CMC commits a serious breach of the duty of confidentiality

CMC violates applicable law, thereby materially jeopardising the Client’s interests

(3) Termination without notice shall also require written form.

(4) In the event of early termination by the Client, there shall be no entitlement to a refund of payments already made. If CMC terminates the agreement, fees paid in advance for service periods not yet rendered shall be refunded on a pro rata basis. This shall not apply where the termination by CMC is based on a breach of contract by the Client.

(5) The return of documents shall be governed by § 14.

§ 16 Right of Withdrawal

As CMC exclusively enters into agreements with business entities or professionals, no statutory right of withdrawal exists.

§ 17 Intellectual Property

All documents, articles of association, contracts, templates and analysis results prepared by CMC are protected by copyright. Any disclosure to third parties or use for purposes other than those agreed shall require the prior written consent of CMC. The same shall apply to proposals, presentations and video content of the client video portal.

§ 18 Force Majeure

(1) Neither party shall be liable for the non-performance or delayed performance of contractual obligations to the extent attributable to force majeure events. Force majeure events shall include in particular natural disasters, epidemics, pandemics, war, terrorism, strikes, governmental orders, cyber-attacks and other events beyond the reasonable control of the affected party.

(2) The affected party shall notify the other party in writing without undue delay. The affected obligations shall be suspended for the duration of the event. Both parties shall endeavour to mitigate the effects.

(3) If the event persists for more than 90 days, either party shall be entitled to terminate the agreement in writing without notice. Services already rendered shall be remunerated on a pro rata basis.

§ 19 Dispute Resolution

The parties undertake to seek an amicable resolution of any dispute in the first instance. If such resolution fails within 30 days of written notification of the subject matter of the dispute, either party shall be free to pursue legal proceedings.

§ 20 Final Provisions

(1) The law of the Republic of Cyprus shall apply, excluding the United Nations Convention on Contracts for the International Sale of Goods (CISG) and the conflict-of-laws rules of private international law.

(2) The exclusive place of jurisdiction shall be Larnaca, Republic of Cyprus.

(3) Should any provision be or become invalid, this shall not affect the validity of the remaining provisions. The invalid provision shall be replaced by a valid provision that most closely reflects the economic purpose intended (severability clause).

(4) Amendments and supplements to these GTE shall require written form. This shall also apply to any waiver of this written form requirement.

(5) CMC reserves the right to amend these GTE with effect for the future. Amendments shall be communicated to the Client in writing no later than 30 days prior to their effective date. If the Client does not object in writing within 30 days of receipt of the notification, the amended GTE shall apply from the date communicated. CMC shall expressly draw the Client’s attention to the objection period and the legal consequence of silence. In the event of an objection, the existing GTE shall continue to apply until the end of the current contract term.

CMC Certus Management Consultants Ltd, Larnaca