Cyprus to Introduce Construction Police as Oversight Tightens in 2026

Photo: Politis

Cyprus President Nikos Christodoulides has announced the creation of a special unit within the Department of Urban Planning and Housing. The new structure is expected to enforce compliance in project execution, reduce risks, and strengthen investor confidence, reports Politis.

Christodoulides noted that recent reforms to the permitting system have already shortened approval times for major and strategic projects. The maximum processing period is now capped at 12 months, a measure the president says has proven effective. He also highlighted the role of the country’s Business Facilitation Centre, which will become an integral part of the next modernization stage. The upcoming milestone is digitalization, expected to reduce bureaucracy and accelerate services for the business community—changes that should attract further investment.

System Reform

The initiative to overhaul market regulations was originally proposed by the Association of Large Construction Companies. Its head, Andreas Dimitriadis, explained that the sector urgently needs a clear and functional supervision mechanism capable of identifying issues early and preventing delays in project delivery. Fragmented procedures and lengthy approvals remain key barriers to large-scale investment.

According to Dimitriadis, the industry requires not minor adjustments but a full reform that could include establishing a dedicated Ministry of Development and Competitiveness. Such a ministry would coordinate essential processes—digitalization, reduction of bureaucracy, and the handling of strategic investments through a unified one-stop-shop service. This structure, he argues, would accelerate major projects and create transparent rules for all market participants.

The Association unites 16 leading companies responsible for the country’s largest developments. Their portfolio includes marinas, casinos, medical centers, universities, technology parks and major tourism complexes worth more than €8 billion. This scale, Dimitriadis notes, allows the organization to identify structural weaknesses and propose reforms that could significantly impact economic growth.

He believes Cyprus possesses strong potential for more sustainable development. Among the core sectors, he names advanced medical services, higher education, technology and IT, tourism, shipping, green energy and public infrastructure. However, realizing this potential requires a well-structured governance system and consistent state policies. An additional boost could come from Cyprus joining the Schengen Area.

Developer Licensing

Earlier, the Cyprus Land and Building Developers Association prepared a draft law introducing official developer licensing. The proposal would create the status of a “land and real estate development entrepreneur,” requiring anyone wishing to legally build and sell property to register in a dedicated public registry. The Association notes that currently any individual or company may operate as a developer without requirements for qualifications, experience or supervision—oversight mechanisms are weak and responsibility is poorly defined.

The bill proposes setting up a registration board responsible for verifying developers’ compliance with professional standards. Criteria include having an equipped office, partnering with a registered technical/design firm, employing a qualified civil engineer, architect or appraiser, and engaging a licensed auditor and an experienced real estate agent. Temporary registration for newcomers would be allowed for up to three years, but without it further construction or property sales would become illegal.

The Association argues that licensing will increase market confidence and stability. Buyers would be protected by dealing only with vetted, reliable developers, while the state would gain a tool to detect and prevent fraud. This should raise trust, eliminate unscrupulous operators and create a foundation for long-term sectoral growth.

The draft law has already been reviewed by the Ministry of the Interior, whose minister expressed positive feedback and instructed the creation of a working group to refine the legislative text together with industry representatives. The final document will then be forwarded to parliament—its adoption could become a historic step toward formalizing the island’s real estate market.

Outlook

Analysts at International Investment note that although the regulatory changes may indeed affect the behavior of foreign buyers, the construction market remains opaque and systemic issues persist. Meanwhile, parliament is already reviewing three separate bills aimed at strengthening oversight of transactions and introducing restrictions on companies with foreign ownership.

Against the backdrop of existing and upcoming regulations, along with declining profitability, the creation of a dedicated construction-monitoring unit is unlikely to radically shift investor sentiment. Regulatory initiatives change too frequently, and conditions for foreign buyers continue to tighten. In such an environment, investors tend to adopt a wait-and-see strategy and prefer markets where regulatory frameworks evolve more gradually and operate under a single, stable set of rules.