Country Report on Terrorism 2015 - Chapter 2 - Cyprus

Overview: The Republic of Cyprus collaborated closely with the United States, the EU, and other countries – bilaterally and multilaterally – in international counterterrorism efforts in 2015. Cyprus' counterterrorism partnership with the United States included participation in the Department of State’s Regional Strategic Initiative programs and Department of Justice’s Regional Overseas Prosecutorial Development, Assistance, and Training program, which strengthened the government's capacity to counter terrorism.

Since 1974, Cyprus has been divided de facto into the Republic of Cyprus government-controlled area, composed of the southern two-thirds of the island, and a northern third, administered by the Turkish Cypriots. In 1983, the Turkish Cypriots declared the northern part to be the independent “Turkish Republic of Northern Cyprus (TRNC).” The United States does not recognize the “TRNC,” nor does any country other than Turkey. The Republic of Cyprus government does not exercise effective control over the area administered by the Turkish Cypriots. The UN Peacekeeping Force in Cyprus patrols the buffer zone separating the two sides, which is largely open to civilian traffic and remains a significant route for the illicit transit of people, narcotics, and other illicit goods.

The division of the island between the Republic of Cyprus government-controlled area and the northern area administered by the Turkish Cypriots has impeded counterterrorism cooperation between the two communities and between the Republic of Cyprus and Turkey, which do not have diplomatic relations. Turkish Cypriots lack the legal and institutional framework necessary to counter the financing of terrorism effectively. Despite these limitations, Turkish Cypriots cooperated in pursuing specific counterterrorism objectives.

In 2015, the United States and the Republic of Cyprus finalized arrangements to exchange biographic and biometric information of suspected terrorists with the goal of improving traveler screening and deterring terrorist travel.

Cyprus is a partner in the Global Coalition to Counter the Islamic State of Iraq and the Levant (ISIL).

Legislation, Law Enforcement, and Border Security: The Republic of Cyprus enacted a National Law on Combating Terrorism in 2010 that incorporates EU Council Framework Decisions. Cypriot authorities continued to develop capabilities under the supervision of the National Counterterrorism Coordinator and a specialized counterterrorist squad in the Cypriot National Police's (CNP) Emergency Response Unit.

In May, the CNP arrested Hussein Bassam Abdallah, a dual Lebanese-Canadian national, after Cypriot authorities found 8.2 tons of liquid ammonium nitrate in the basement of his residence in Larnaca. Abdallah admitted to Cypriot authorities he was a member of Hizballah. The Republic of Cyprus charged Abdallah with five offenses, including participation in a terrorist organization and providing support to a terrorist organization. After pleading guilty to all charges, he was sentenced to six years in prison on June 29. The Abdallah case marked the first time the 2010 counterterrorism law was used to prosecute a terrorism case. A prior Hizballah-related arrest in 2012 was tried under standard criminal laws.

In response to multiple terrorist attacks in Europe, Cyprus enhanced its security cooperation and law enforcement measures. These activities included increased patrols around critical infrastructure and soft targets, strengthened passport control at airports and seaports, and increased security measures and surveillance at border crossing points and along the “Green Line” and Cypriot coast.

Cyprus continued to participate in regional and international workshops on Hizballah, aimed at improving the use of law enforcement tools to counter terrorist threats.

Countering the Financing of Terrorism: The Republic of Cyprus is a member of the Council of Europe’s Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism (MONEYVAL), a Financial Action Task Force (FATF)-style regional body. Cyprus’ financial intelligence unit, the Unit for Combating Money Laundering (MOKAS), is a member of the Egmont Group.

In 2015, Cypriot authorities were currently conducting a national risk assessment on money laundering and terrorism financing, covering the entire anti-money laundering/countering the financing of terrorism (AML/CFT) system, including charities. This document will build on a set of AML/CFT reforms, focussing on financial sector transparency that Cyprus implemented in 2013-2015 in accordance with its IMF assistance program. In calendar year 2015, Cyprus did not identify or freeze any assets pursuant to relevant UN Security Council Resolutions (UNSCRs), including 1373 (2001) or the 1267/1989/2253 ISIL and al-Qa’ida sanctions.

Cyprus has implemented the UN 1267/1989/2253 ISIL (Da’esh) and al-Qa’ida sanctions regime and informally tracked individuals and entities listed under U.S. Executive Orders, including E.O. 13224. The Combating of Terrorism Law of 2010 provides a comprehensive legal framework on terrorism including adequate provisions regarding terrorism financing. In particular, Section 8 of the 2010 law criminalizes support and financing to any terrorist group, associated parties, and entities designated by EU and UN authorities. Additionally, the Ministry of Foreign Affairs circulates updates of UN and EU lists to competent authorities, including MOKAS, Central Bank of Cyprus, Chief of Police, various ministries, Central Intelligence Service, Cyprus Ports Authority, Cyprus Securities and Exchange Commission, the Cyprus Bar Association, and the Institute of Certified Public Accountants of Cyprus. However, the December 2015 FATF Terrorist Finance Fact Finding Initiative identified Cyprus for not having legal powers in place to apply targeted financial sanctions pursuant to UNSCR 1373 to EU internals.

The Central Bank of Cyprus is the supervisory authority for the banking sector including cooperative societies, electronic money institutions and payment institutions. Cyprus does not have a significant unregulated informal banking and money transfer system.

For further information on money laundering and financial crimes, see the 2016 International Narcotics Control Strategy Report (INCSR), Volume II, Money Laundering and Financial Crimes:

Countering Violent Extremism: Cyprus attended the September Leader’s Summit on Countering ISIL and Violent Extremism hosted by President Obama in New York and continued its participation in the European Commission’s Radicalization Awareness Network. The government exchanged best practices with partners on addressing terrorists’ internet recruitment efforts. Police and prison officers also received training on countering radicalization to violence by the CNP’s Counterterrorism Office.

International and Regional Cooperation: Members of the CNP’s Counterterrorism Office participate in the Working Group on Terrorism (CWP) at the Council of the EU. Cyprus regularly participates on the Police Working Group on Terrorism, the “Dumas” Working Group, and the European Expert Network on Terrorism, as well as meetings convened under Europol and INTERPOL. Cyprus has contributed to the Council of Europe’s efforts to establish and adopt the Additional Protocol to the Council of Europe Convention on Combating Terrorism, which addresses foreign terrorist fighters within the framework of UNSCR 2178 (2014). Cyprus also participated in regional and international conferences on foreign terrorist fighters and countering Hizballah.